Klarna Looks to Cut Jobs, Slow Growth

Months after laying off 10% of its employees and an 85% drop in its Buy Now Pay Later (BNPL) rating, the Klarna company is considering further job cuts.

A manager of the Swedish company’s internal engineering unit said this week that the company would focus less on growth and employ fewer people by the end of the year, Bloomberg reported on Friday (September 23), citing unnamed sources.

See also: Klarna’s 85% haircut makes BNPL investors shoot first and ask questions later

Earlier this week, Chief Operating Officer Camilla Giesecke had informed employees that staff performing internal support functions would be reduced to accommodate a reduced workforce, the report said.

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“With a leaner organization to support, I have concluded that we need to restructure the COO areas to reflect the more focused nature of Klarna today,” Giesecke said in a memo, according to the report.

A Klarna spokesman told PYMNTS that the restructuring will affect fewer than 100 employees in a small division of the company.

“Over the summer we appointed a new COO and it’s natural for a new manager to make changes, which is happening now,” the spokesman said.

While the company routinely moves employees between teams and makes adjustments, these are “often small in scale compared to the large changes we made this spring, prompted by the turbulent environment,” the spokesperson added.

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Continue reading: Klarna cuts around 700 jobs due to inflation and war

At least 70% of the people who left Klarna at the start of the summer are already in new jobs, the spokesman said.

In late August, Klarna released a first-half report showing that spending related to its US operations and international market expansion, coupled with the integration of new acquisitions and rising credit losses, contributed to a chaotic half-year.

See more: Klarna faces growing pains as losses mount

“When we formulated our business plans for 2022 last fall, it was a completely different world than the one we are in today,” said CEO Sebastian Siemiatkowski at the time.

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