Tech valuations in general have suffered since 2022, when the Federal Reserve hiked interest rates aggressively to combat rising inflation. Many frothy business models that depended on easy credit—BNPL foremost among them—suffered as capital became costlier. Broader macroeconomic volatility has weighed on many firms similar to Klarna, as geopolitical unrest and trade policy uncertainty have combined to put a cap on investment.
The American consumer is the engine of the American economy, responsible for two-thirds of GDP most years. And yet something funny has happened in 2025, as the massive surge in data-center construction associated with the AI revolution has contributed more to GDP growth than consumers getting out and shopping. This isn’t to say that data-center construction is two-thirds of GDP, but that it’s growing faster than the average consumer, who is showing signs of fatigue amid a stagnant labor market and a rising inflation backdrop.
Over the past two years, the company has rebuilt with a focus on cutting losses, expanding into adjacent businesses like advertising, and working toward profitability. The IPO is expected to test investor appetite for fintechs that once commanded dizzying valuations but now face more traditional public-market scrutiny on margins and earnings.
The listing, expected in New York later this year, will still mark one of the most significant European tech IPOs of the decade. Investors will be watching closely to see whether Klarna’s new chapter proves it can outgrow its BNPL roots — or whether once-hot fintechs will struggle to recapture their private-market shine.
For this story, Fortune used generative AI to help with an initial draft. An editor verified the accuracy of the information before publishing.
