Klarna Group (KLAR) Q4 2025 earnings summary

Executive summary

• Achieved first billion-dollar revenue quarter in Q4 2025, with revenue up 38% year-over-year to $1.082 billion, surpassing guidance.

• GMV reached $38.7 billion, up 32% year-over-year and above the top end of guidance, with annual volume surpassing $127 billion across 26 markets.

• Active consumers reached 118 million (+28% YoY), merchants grew 42% to 966,000, and banking consumers surged 101% to 15.8 million.

• Rapid adoption of banking products, including Klarna Card and Fair Financing, drove compounding growth and product ubiquity.

• U.S. market led growth, with revenue up 58% year-over-year and 29 million U.S. consumers served.

Financial highlights

• Revenue reached $1.082 billion in Q4 2025, up 38% year-over-year and 10% sequentially, beating guidance.

• GMV totaled $38.7 billion, up 32% year-over-year and 17% sequentially, exceeding expectations.

• Transaction margin dollars before provisions grew 31% to $622 million; after provisions, up 17% year-over-year to $372 million.

• Provisions for credit losses declined to 0.65% of GMV in Q4 from 0.72% in Q3.

• Adjusted operating income was $47 million, a notable turnaround from prior periods.

Outlook and guidance

• 2026 guidance expects GMV and revenue growth in line with 2025, with transaction margin growth accelerating in the second half as fair financing cohorts mature.

• Adjusted operating income margin expected to exceed 6.9% in 2026.

• Transaction margin dollars as a percentage of GMV to remain broadly consistent with Q4 2025 in the near term.

• Loan sales and forward flow programs to continue supporting capital efficiency and profitability.

• Forward-looking statements highlight growth objectives and market opportunities, with caution regarding risks and uncertainties.