COLUMBUS, Ohio—In what may be an indicator of a growing problem within the buy now, pay later space, BNPL giant Klarna has experienced large losses this year.
The company has seen its losses more than triple in the first half of the year, a challenging period during which its valuation plummeted by 85%, Sifted reported.
Klarna reported operating losses before tax that climbed to $580 million in the first six months of 2022, more than tripling from $168 million in the same period last year, Sifted noted.
Sifted added the news comes after the company laid off 10% of its global workforce, around 700 people, in May.
“Confirmation of Klarna’s worsening burn rate comes a month after the startup suffered a massive valuation drop from $46 billion to $6.7 billion, as it tapped investors for $800 million in fresh funding,” Sifted said.
Other Developments
The news comes even as Klarna has announced there is a waitlist for its new credit card.
In addition, as CUToday.info reported here, many of the companies offering BNPL solutions have begun to see an increase in delinquencies.
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