By Manya Saini and Arasu Kannagi Basil
(Reuters) -Swedish fintech company Klarna on Friday reported a 24% surge in 2024 revenue, as the buy now, pay later pioneer made public its paperwork for a long-awaited stock market debut in the U.S.
Fintech listings soared in 2021 but lost momentum due to rising interest rates and steep valuations. But with risk appetite in equity markets slowly picking up, several companies that had shelved their listing plan are eyeing a comeback.
Klarna, which reshaped online shopping by pioneering the short-term financing model, did not disclose the size of its proposed offering.
Media reports suggest it could aim to raise more than $1 billion at a valuation exceeding $15 billion.
The BNPL market is projected to surpass $160 billion by 2032, with retailers such as Walmart, Target and Amazon joining fintech firms such as Klarna, Affirm and Block to attract younger, credit-averse shoppers.
Klarna's revenue grew to $2.81 billion in the year ended Dec. 31 compared with $2.28 billion a year ago. It earned $21 million, compared with a loss of $244 million, a year ago.
The company's latest step comes as stock market volatility, driven by renewed recession fears and uncertainty over President Donald Trump's tariffs, threatens to stall a recovery in the IPO market.
"The latest spike in volatility has dimmed the IPO prospects for a number of companies, but that has not completely shut down the market for new listings," said Matt Kennedy, senior strategist at Renaissance Capital, a provider of IPO-focused research and ETFs.
Klarna had 93 million active customers on its platform and operations in 26 countries as of 2024 end, according to the IPO filing. It's rival Affirm currently commands a valuation of roughly $15 billion.
U.S. fintech rivals Stripe and Chime were last valued at $91.5 billion and $25 billion, respectively, in a tender offer and private funding round. Both companies are reportedly preparing for IPOs.
Klarna said in its IPO filing it was working to fix a material weakness in its systems that are used to prepare their financial statements. It also said the Swedish Consumer Agency is investigating the company's compliance with marketing laws.
END TO IPO WAIT
For years, Klarna's likely stock market debut has been the subject of intense speculation, with previous plans fizzling out amid volatile market conditions and shifting investor sentiment.
Its decision to go public now comes as a key test for fintech IPO appetite, following a period of weak listings and tighter funding for private firms.