Klarna Group (NYSE:KLAR) shares jumped more than 13% in premarket trading Thursday after the company reported first-quarter results that exceeded Wall Street expectations, supported by strong transaction growth and improving profitability.
Revenue and GMV Growth Outpace Expectations
Klarna posted an adjusted loss of -$0.01 per share for the quarter, significantly better than analyst forecasts for a loss of -$0.20 per share.
Revenue climbed 44% year-on-year to $1 billion, beating the consensus estimate of $944.43 million.
Gross merchandise volume (GMV) increased 33% to $33.7 billion during the quarter.
The company said U.S. GMV grew 39%, while international markets recorded growth of 31%.
Company Returns to Operating Profitability
Klarna reported adjusted operating profit of $68 million, compared with $3 million in the same quarter last year.
Operating income turned positive at $17 million after the company posted an operating loss of -$90 million in the first quarter of 2025.
Net income also improved sharply, reaching $1 million versus a net loss of -$99 million a year earlier.
CEO Highlights Broad-Based Business Momentum
Chief executive and co-founder Sebastian Siemiatkowski said the company delivered strong performance across its operations during the quarter.
“In Q1 we executed well across all the business, driving every line of our P&L and compounding growth across our global network,” Siemiatkowski said.
Consumer and Merchant Networks Continue to Expand
Klarna’s active consumer base grew 21% year-on-year to 119 million users.
Its merchant network expanded 49% to more than one million merchants globally.
Transaction margin dollars increased 44% to $389 million.
The company also said the Klarna Card reached five million active users across 16 countries.
Meanwhile, Fair Financing GMV surged 138% year-on-year as more customers opted for installment-payment options on larger purchases.
Second-Quarter Guidance Comes in Below Consensus
For the second quarter, Klarna projected revenue between $960 million and $1 billion.
The midpoint of the guidance range, at $980 million, came in below analyst expectations of $1.06 billion.
The company also forecast GMV between $35.5 billion and $36.5 billion, alongside adjusted operating income of $30 million to $50 million.
Full-Year Outlook Reaffirmed
Klarna maintained its full-year 2026 guidance.
The company added that revenue generated per employee reached nearly $1.4 million, approximately four times the level recorded in 2022.