Leveraging AI, Klarna is steadily building the Google of Shopping šļø; Robinhood keeps delivering one good news after the other š¤
FinTech is Eating the World, 1 September
Hey Everyone,
TGIF! This week was just insaneā¦ š³ And itās not even over as today weāre looking at Klarna thatās steadily building the Google of Shopping (BNPL giant crushed its latest numbers & why you should care), and Robinhood which keeps delivering one good news after the other (why Iām becoming more bullish + a closer look at one of the cheapest FinTechs out there). Letās jump straight into the intriguing stuff š¶
Leveraging AI, Klarna is steadily building the Google of Shopping šļø
The numbers š On Monday, I already talked about Klarna. But we must end up the week with it as well since the BNPL pioneer just reported a profitable month for the first time in 3 years š³
More importantly, by leveraging AI, the FinTech giant is building the Google of Shopping.
Letās take a look.
More on this š Following a super difficult period that led to massive losses, valuation collapse, and letting go of thousands of employees, the Buy Now, Pay Later heavyweight literally smashed the first half of 2023.
Here are the key takeaways from Klarna's H1 2023:
Klarna returned to profitability in Q2 2023, recording its first month of net profit in June. This was ahead of schedule and highlights Klarna's ability to deliver on its strategic focus of both growth and profitability. Big congrats š
Revenue increased 17% year-over-year to SEK 5.5 billion in Q2 2023. Total net operating income was up 21% to SEK 4.8 billion. This reflects prudent financial management and delivering substantial value to customers.
Adjusted total operating expenses before credit losses improved 26% compared to Q2 2022, showing Klarna's focus on optimizing costs while maintaining customer service.
Credit losses decreased 41% compared to Q2 2022 and remained low at 0.39% of gross merchandise volume (GMV) in the first half of 2023. This illustrates Klarna's responsible lending approach. Big one!
GMV increased 14% year-over-year in Q2 2023, driven by the US and UK markets. New partnerships like Airbnb further accelerated GMV growth.
The US market continues to be a key driver of sustainable and profitable growth. The US achieved its third consecutive quarter of gross profit.
Klarna continues to invest in AI to enhance customer offerings and optimize efficiency. Initiatives like personalized shopping feeds in the app demonstrate the benefits AI brings.
S&P assigned a credit rating of BBB-/A-3 to Klarna Bank with a stable outlook, reflecting Klarna's robust position in e-commerce and progress toward profitability
Also, Klarna is the only bank among ChatGPT Enterprise launch customers š
Affirm AFRM 0.00%ā are you watching?
But that's not even the most exciting part.
What's impressive is how steadily yet strategically Klarna has been building its Super App:
When it comes toĀ finance, Klarna is already a bank in several countries offering checking and savings accounts, among IBANs and other things.
Recently it launched theĀ Pay NowĀ option globally so customers can pay in full wherever Klarna is accepted.
It even has theĀ Klarna CardĀ which lets users pay in installments in-store & online. The Klarna Card integrates into the Klarna app and is connected with its loyalty program,Ā Vibe.
Klarna also has aĀ commerce searchĀ thatĀ compares thousands of websites to help consumers find the best price for products.
Thereās alsoĀ a shoppable videoĀ where retailers share existing social content and campaigns that tell their story and create shoppable content exclusively for Klarna.
Finally,Ā Klarna's Creator PlatformĀ provides a one-stop shop for retailers and creators to work together to automate initial outreach, partnerships, and tracking sales and commissions.
āļø THE TAKEAWAY
Zoom out š That said, itās clear that Klarna is building the ultimate shopping destination of the future. It's striving to become theĀ Google of Shopping. And if it goes the way it seems to be going right now, Klarna might soon become the most impressive turnaround story in the history of FinTech. Bullish.
ICYMI: Klarna is turning the world pink šš [+ some deeper dives into Klarna]
P.S. Klarnaās marketing team deserves a raise:
