Shares of Klarna Group PLC (NASDAQ:KLAR) are volatile Thursday after the flexible payments firm announced a significant AI partnership with Google.
What To Know: The partnership will give the Swedish company, which is best known for its buy now, pay later product, access to Google Cloud’s complete AI stack, including models and infrastructure. Early pilots of the program have already driven 50% order growth and a 15% increase on time spent on the Klarna app.
Klarna’s stock initially jumped close to 6% on the news before coming back down and turning negative for the session, according to Benzinga Pro.
The AI-focused partnership will allow Klarna, which has more than 114 million consumers, to develop products and creative campaigns faster. The company will use Google’s latest generative media models, Veo 2 and Gemini 2.5 Flash Image, to create digital lookbooks and personalized product campaigns. The company has said in the past that 96% of Klarna’s employees use AI daily.
“By combining Google Cloud’s leading AI models with Klarna’s unique consumer insights, we can craft experiences that feel smarter and more personal,” said Klarna chief marketing officer David Sandström.
Klarna will also use Google Cloud’s AI to bolster security by developing graph neural networks to combat fraud and money laundering. The AI capabilities analyze complex relationships between users, transactions and devices to detect suspicious behavior or patterns.
“To lead in this new AI era, businesses require more than tools—they need strategic capabilities. Our partnership with Klarna is about providing just that,” said Marianne Janik, vice president, EMEA North at Google Cloud.
“Our integrated, AI-optimized platform and cutting-edge models are enabling Klarna to unlock significant creative velocity and drive innovation. We’re proud to help Klarna not just adopt AI, but also use it to fundamentally redefine the customer experience.”
Klarna, which was founded in 2005, went public in September with an opening price of $52. In August, it achieved its fifth consecutive quarter of operational profitability, bringing in $823 million in revenue. The company credited recently reaching its goal of $1 million in revenue per employee to AI.
Klarna is extremely bullish on the new technology. CEO Sebastian Siemiatkowski said he wants to reduce his workforce, which was last reported around 3,500 at the end of last year, to 2,000 through the implementation of AI. Klarna’s headcount was more than 5,500 in 2022.
KLAR Price Action: Shares of Klarna were down 1.32% at $41.54 at the time of publication on Thursday, according to Benzinga Pro. The stock hit a high of $44.75 on Thursday before dipping as low as $41.40.
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