- Klarna said it used an AI avatar of its CEO to report quarterly earnings in a YouTube video.
- Klarna brands itself as an AI company and has "streamlined" its workforce by 40% since 2022.
- Klarna's Q1 results show revenue growth but see a spike in net and credit losses.
Buy now, pay later services company Klarna said it used an AI doppelganger of CEO Sebastian Siemiatkowski to report its quarterly earnings on Monday.
The AI avatar appeared in a video on Klarna's official YouTube channel to deliver earnings highlights. It wore a brown jacket reminiscent of one in Siemiatkowski's corporate headshots, and aside from a lack of blinking and suspect lip syncing, there were no significant giveaways.
"Our AI-first strategy is driving exceptional returns, we're outpacing competitors, our merchant network is scaling rapidly, and our next-gen products are reshaping money management for millions," a presumably human Siemiatkowski said in a press release.
The move comes as Klarna, which last month put its IPO on ice due to economic uncertainty, tries to brand itself as an AI company. In the earnings press release, Klarna said it has "streamlined" its workforce by around 40% since 2022.
In 2022, 800 employees were fired, while some were quietly offered an exit package last year after being placed into a "talent pool." In February 2024, Klarna announced that its OpenAI-powered AI customer service agents could do the equivalent work of 700 full-time human employees.
Klarna has recently ramped up partnerships with platforms like Walmart, eBay, and DoorDash, but consumer watchdogs have long been concerned about the potential for overspending under BNPL services. Under the Biden administration, the Consumer Financial Protection Bureau treated BNPL providers as credit card lenders, which required stricter protections around disclosures and disputes. On May 6, the CFPB said in an announcement it would no longer enforce the rule and would consider rescinding it.
The Federal Reserve found in 2024 that users of BNPL services are more likely to rely on high-interest financing tools and are more financially fragile. LendingTree, an online lending marketplace, also found in an April survey that 41% of BNPL users in the US paid late over the last 12 months, up from 34% a year ago.
Klarna's latest Q1 results also show that an increasing number of people may not have been paying their loans. While revenue grew 13% year over year and it reached 100 million active users, Klarna also doubled its net losses from $47 million in Q1 2024 to $99 million in Q1 2025 — a 110% increase.
During the May 19 earnings call, Klarna attributed the spike in losses to several one-off costs related to depreciation, share-based payments, and restructuring.
Klarna's consumer credit losses have also jumped, which its Q1 financial report said is "driven by the accelerated expansion of Pay Later and Fair Financing products." Klarna's first quarter saw a 17% year-on-year increase in credit losses from $117 million to $136 million.
Klarna did not immediately respond to requests for comment.
