Klarna reported Q1 2026 revenue of 1.012 billion dollars, a 44 percent increase year over year, with positive net income marking the BNPL lender’s first profitable quarter since its September 2025 IPO on the New York Stock Exchange. The result arrives after the company’s stock declined from its 40-dollar IPO price to approximately 17 dollars, reflecting investor skepticism about BNPL profitability timelines.
The profitability improvement stems from an operational restructuring powered by AI. Klarna’s revenue has doubled since Q4 2022 while operating expenses declined 8 percent over the same period, a divergence the company attributes to AI-enabled automation across customer service, underwriting, and internal operations. The cost structure transformation has generated the operating leverage that the stock market had been waiting to see in reported earnings.
US performance continued to outpace other markets, with revenue growing 58 percent and GMV increasing 43 percent year over year. Klarna now serves 29 million US consumers, representing approximately 11 percent of the US population reached in the prior 12 months. Full-year 2025 results showed total GMV of 127.9 billion dollars and revenue of 3.5 billion dollars.
Management reiterated 2026 guidance, with earnings forecast to grow 82 percent over the next 12 months. The quarter provides evidence that Klarna’s AI-driven cost compression can deliver sustained margins, though the stock’s significant decline from IPO price suggests investors require multiple quarters of profitability before repricing the equity.
