Klarna faces a second round of layoffs – FF News

Swedish BNPL company Klarna Bank AB announced it would cut jobs again after losing $39 billion in value.

Camilla Giesecke, Chief Operating Officer of Klarna, announced the news and announced the layoffs in a video call to employees.

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Speaking to 500 employees, she said the BNPL giant would need to make further cuts, particularly in IT and HR departments, “to reflect the more focused nature of today's Klarna.”

The company has confirmed the job cuts and said that fewer than 100 employees worldwide will be affected.

“We appointed a new COO in the summer and it is natural that a new manager makes changes and that is the case now,” said a Klarna spokesperson.

New COO Gisecke said the move would reflect a reduction in the workforce. Klarna had previously announced layoffs earlier this year, with the company announcing plans to cut 10% of its approximately 7,000 employees.

“As we need to support a leaner organization, I have come to the conclusion that we need to restructure the COO areas to reflect the more focused nature of today's Klarna,” Giesecke said, according to a memo seen by Bloomberg.

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The news comes after Klarna's losses more than tripled to £500 million in the first half of 2022 due to the economic slowdown and rising costs and increasing loan defaults.

News of the latest layoffs comes two months after Klarna's valuation fell sharply after the company raised $800 million in a new funding round at a $6.7 billion valuation.

The new valuation is nearly $39 billion lower than last year's value, when the company was valued at $45.6 billion following a $639 million funding round led by Japanese firm SoftBank.