Headlines
Sweden's Klarna shifts AI focus from cost cuts to growth
Published by Global Banking & Finance Review®
Posted on September 10, 2025
3 min readLast updated: January 22, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on September 10, 2025
3 min readLast updated: January 22, 2026
Klarna shifts its AI strategy from cost-cutting to enhancing growth and services following its New York IPO, aiming to improve consumer and merchant offerings.
By Supantha Mukherjee and Echo Wang
STOCKHOLM/NEW YORK (Reuters) - The CEO of Sweden's Klarna, one of the early adopters in Europe of artificial intelligence, says the company may have gone too far in using the technology to cut costs and is now focusing on improving its services and products.
Sebastian Siemiatkowski made the remarks in an interview with Reuters on Tuesday which was cleared for publication on Wednesday when the buy-now, pay-later lender made its market debut in New York. Its shares jumped 30% at the open to $52 apiece, well above its IPO price of $40, giving the fintech a valuation of $19.7 billion.
Global companies are racing to harness AI to help them improve efficiency, lower operational costs and enhance decision-making, but the transition is proving rocky.
Klarna has cut thousands of jobs, dropped vendors such as Salesforce Inc and turned to AI to create marketing campaigns, saving millions but now realizing it went too fast, too soon.
"We probably over indexed a little bit on that, and then in the last six months we have been trying to course correct," Siemiatkowski told Reuters from New York.
He added that a major focus was boosting productivity and improving products for customers and merchants.
Klarna raised $1.37 billion on Tuesday in its U.S. initial public offering, valuing the company at $15 billion and setting the stage for a market debut that could set the trend for high-growth fintech listings.
Siemiatkowski said last year it had reduced staff to 3,800 from 5,000, with more reductions expected as it leans on AI to handle customer queries. Its chatbot was already doing the work of 700 staff, cutting average resolution times to two minutes from 11 minutes, the company said.
In May, Klarna used an AI avatar of Siemiatkowski to present its quarterly earnings. It even started a hotline for customers to talk directly with an interactive AI avatar trained on Siemiatkowski’s real voice, insights and experiences.
The company is now back to hiring people. It has over two dozen open positions on its jobs portal.
PRODUCTIVITY AND GROWTH
Siemiatkowski said although Klarna saved about $2 million by dropping Salesforce software in favor of its AI-built data tools, the savings were insignificant for investors.
"My investors are not going to be cheering, they're going to look for growth, and they're going to look to what we offer our customers and how that's doing," he said.
Klarna, which transformed online shopping with its short-term financing model, is listing in the U.S. as it is the company's largest market, where it competes with the likes of Affirm.
The company still thinks AI can deliver.
"That's definitely not just a cost play... it's going to be a lot more than that, and it's going to be able to help us provide better services to consumers and merchants over time.” Klarna Chief Financial Officer Niclas Neglen told Reuters.
Siemiatkowski, who owns about 7% of Klarna, did not sell his shares in the IPO - the biggest for a Swedish company since Spotify. "The IPO matters a lot for employees, for our shareholders. It's a little bit like a wedding, it's a big party and then life goes on, and you get kids and other things happen," he said.
(Reporting by Supantha Mukherjee in Stockholm and Echo Wang in New York; Editing by Kenneth Li, Adam Jourdan and Emelia Sithole-Matarise)
Sebastian Siemiatkowski mentioned that Klarna may have over-indexed on using AI for cost cuts and is now trying to course correct by focusing on productivity and improving products.
Klarna raised $1.37 billion in its U.S. initial public offering, valuing the company at $15 billion.
Klarna reduced its staff from 5,000 to 3,800 and plans further reductions as it relies on AI to handle customer queries, with its chatbot already performing the work of 700 staff.
Klarna is now back to hiring, with over two dozen open positions listed on its jobs portal.
Investors are primarily looking for growth and how Klarna's offerings are performing for customers, rather than just cost savings.
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