| Factor | Score | Distribution | Value | Avg | Rank |
|---|---|---|---|---|---|
Valuation | 18 | — | 17.8x | Bottom tier | |
Growth | 74 | 47.3% | 7.1% | Top tier | |
Quality | 20 | — | — | Bottom tier | |
Safety | 22 | — | — | Bottom tier | |
Capital Return | 20 | — | 2.12% | Bottom tier | |
Momentum | 29 | — | 2.9% | Bottom tier | |
Sentiment | 85 | 11 | 3 | Top tier |
Estimates — analyst targets and a simplified DCF, not investment advice.
Ten ratios that matter, each compared against its sector median and average — so you can see whether a number is rich or cheap relative to peers in the same sector.
Klarna Group plc, listed on the NYSE under the ticker KLAR, provides a consumer payments and credit ecosystem covering three spending patterns. Pay in Full includes recurring purchases under $75 and generates revenue from payment fees, subscriptions, and deposit interest, while Pay Later offers short-term, interest-free installments for purchases between $75 and $500, and Fair Financing provides fixed-term installments for purchases between $500 and $10,000. The company also generates revenue from transaction and service fees, interest income, and gains on the sale of receivables, while using loan sale arrangements to reduce capital consumption.
In Q2 FY2026, revenue rose 27% to $1.042 billion, compared with an 18% increase in gross merchandise volume to $36.6 billion. Transaction margin dollars reached $446 million, up 42%, and accounted for 42.8% of revenue after improving by approximately 450 basis points, while adjusted operating income was $91 million and net income was $9 million, or $0.01 per share, compared with a loss of $0.14 per share in the comparable period. Non-transaction operating expenses grew 16% to $419 million, a rate below the growth in revenue and transaction margin.
Transaction and service revenue was $707 million, interest income was $266 million, and gains on sales were $69 million in Q2 FY2026. Geographically, the United States generated $376 million in revenue, up 37%, and $7.9 billion in gross merchandise volume, up 27%, while markets outside the United States recorded $666 million in revenue and $28.8 billion in volume. At the product level, Fair Financing reached $4.7 billion in volume, up 82%, and accounted for 13% of total volume, while Pay Later grew 13% and Pay in Full contributed $3.6 billion in volume.
Automated analysis for informational purposes only — not investment advice.
The average analyst price target is $19.14, with a wide range between $15 and $27 and a neutral consensus, and the average stands at only approximately 40% of the 52-week range high of $47.48. No reliable positive price-to-earnings multiple is available following the FY2025 loss of $294 million, so the valuation rests on the ability of Q2 FY2026 earnings and the adjusted operating income outlook of $280–300 million to translate into sustainable annual profitability despite the lowered volume and revenue outlook.
Figures in the text are as of 2026-08-30; the live price is shown at the top of the page.
Klarna generates revenue from transaction and service fees, interest income, and gains on the sale of receivables, in addition to subscriptions and deposit interest associated with its ecosystem. In Q2 FY2026, transaction and service revenue was $707 million, interest income was $266 million, and gains on sales were $69 million. Its products are divided among Pay in Full for purchases under $75, Pay Later for purchases between $75 and $500, and Fair Financing for purchases between $500 and $10,000.
The company lowered its gross merchandise volume outlook to $149–151 billion from more than $155 billion and its revenue outlook to $4.08–4.16 billion from more than $4.34 billion. Management attributed approximately $600 million of the reduction in its volume outlook to currency movements and linked the remainder to a slowdown in Europe, particularly Germany, the company's largest market by volume. In contrast, it raised its transaction margin dollar outlook to $1.62–1.65 billion due to better economics per dollar of volume.
Fair Financing is a fixed-term installment product for purchases between $500 and $10,000 and was Klarna's fastest-growing product in Q2 FY2026. Product volume rose 82% to $4.7 billion, it became available at 256 thousand merchants, and it accounted for 13% of the company's total volume. Management believes its higher-return mix was a primary reason transaction margin dollars grew 42% and the U.S. margin increased from 14% to 23% of revenue.
Klarna recorded Q2 FY2026 net income of $9 million and earnings per share of $0.01, compared with a loss of $0.14 per share a year earlier. Adjusted operating income was $91 million, and transaction margin dollars increased to $446 million, reaching 42.8% of revenue. Provisions also declined to 0.52% of volume, while delinquencies of more than 30 days improved by approximately 20 basis points quarter over quarter in Fair Financing and approximately 30 basis points in Pay Later in the United States.
The JPMorgan Payments integration went live on August 6, 2026, allowing merchants on its platform to offer Pay in Full, Pay Later, and fixed-term installments through their existing setup. JPMorgan Payments processes $2.6 trillion in payments annually, giving Klarna a major distribution channel without requiring each merchant to complete a new integration. Apple Upgrade creates a direct relationship with new U.S. consumers, and Klarna treats its receivables as financing receivables and expects it to contribute positively to adjusted operating income during FY2026.
Klarna announced that Chief Financial Officer Niclas Neglen and Chief Marketing Officer David Sandstrom will begin planned transitions in early 2027. Neglen remains Chief Financial Officer and a board member and continues to lead finance and investor relations during the transition period, and the company has begun searching for a New York-based Chief Financial Officer. Management also explained that Sandstrom will hand over marketing responsibilities during 2027 as planned and did not link these transitions to any change in its approach to funding, capital allocation, or U.S. expansion.
