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Klarna to lay off 10% of its workforce


Klarna’s buy now-pay later product became hugely popular after the Covid pandemic.

Noam Galai | Getty Images

Klarna will lay off approximately 10% of its global workforce. This makes the Buy Now, Pay Later firm the most recent major tech company that announces job losses.

Klarna CEO Sebastian Siemiatkowski made the announcement Monday to employees via a recorded video message. Klarna’s CEO and co-founder Sebastian Siemiatkowski said the measure won’t have any impact on the majority of employees. However, some workers will be told that they cannot offer them a position in the new organisation.

Klarna said that if you work in Europe, Klarna will offer you to leave Klarna and an associated payment. The process for employees who are impacted outside of Europe will be different depending on your work location.

Siemiatkowski indicated that Klarna will provide more details to employees regarding the changes “very shortly”. More than 6500 people work for the Swedish payments company.

Buy now, pay later products like Klarna’s — which allow shoppers to spread the cost of purchases over a series of interest-free installments — became wildly popular as Covid accelerated adoption of online shopping. However, investors have begun to worry about whether the sector will continue its growth in the face of rising inflation and higher borrowing costs. AffirmSince 2022, BNPL provider X has suffered a nearly 35% loss in stock market value.

After that, the move follows mediaLast week, reports claimed that Klarna would lose one-third of its market capital in a new funding round. This privately-held company is last valued at $46 billionAn investment lead by SoftBank. Klarna spokeswoman said that the company does not comment on speculation in the market.

Siemiatkowski stated that Klarna’s decision not to cut staffing was difficult, but essential for the company to remain “laser-focused” on what will be their success moving forward.

Siemiatkowski explained that it is crucial to be calm and collected in the face of stormy weather. However, Siemiatkowski also said that you must not ignore reality. The world we live in now cannot be viewed as temporary, so we must take action.

Many companies in tech that have thrived since the Covid pandemic now want to lower their costs and make it more attractive for investors. sour on the sectorDue to rising interest rates and decreasing market liquidity. Facebook parent company MetaAnd UberIncluded in the list of companies that are slowing down hiring NetflixAnd RobinhoodThey have also announced job losses.