Klarna Profits, Plans IPO Amid Workforce Cuts

Klarna is significantly reducing its workforce, aiming to cut nearly half its employees by leveraging AI for increased efficiency and cost savings. The company has already reduced its headcount from 5,000 to 3,800 and plans to further reduce it to 2,000. Despite the job cuts, Klarna has posted an adjusted operating profit of 673 million SEK for the first half of 2024, up from a loss in the same period last year, with revenue growing 27% year-on-year to 13.3 billion SEK. The AI implementation has not only improved operational efficiency but also boosted profits and customer satisfaction. Klarna is preparing for an IPO next year, targeting a valuation of around $20 billion. CEO Sebastian Siemiatkowski emphasizes the need for policymakers to address the societal impacts of AI-driven job displacement.