Affirm vs Klarna: Revenue, Profit and Business Model
Affirm reported $4.3B of revenue in FY2026 and $1.9B of net income. Klarna reported $3.5B of revenue in FY2025 and a net loss of $273M.
Latest financial snapshot
Financial summary
Affirm
Affirm's results depend on transaction volume, credit performance, funding costs, and loan-sale markets. FY2026 revenue was $4.261 billion on $50.2 billion of GMV. Net income was $1.930 billion, but included a $1.45 billion income-tax benefit from releasing a valuation allowance on domestic deferred tax assets.
Klarna
Klarna's revenue grew from $2.28 billion in 2023 to $2.81 billion in 2024 and $3.51 billion in 2025, according to its 2025 Form 20-F. Net income swung from a $244 million loss in 2023 to a $21 million profit in 2024, then back to a $273 million loss in 2025, even as adjusted operating profit reached $65 million. Q4 2025 was its first billion-dollar quarter at $1.082 billion of revenue on $38.7 billion of GMV. In Q2 2026, revenue rose 27% to $1.042 billion, transaction margin dollars rose 42% to $446 million and net income was $9 million, against a $53 million loss a year earlier. The market cap was about $5.2 billion in late September 2026, well below the roughly $15 billion valuation at its September 2025 IPO.
Revenue and profit by year
Affirm
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $4.3B | $1.9B | 45.3% | +32.2% | Source |
| FY2025 | $3.2B | $52.2M | 1.6% | +38.8% | Source |
| FY2024 | $2.3B | -$517.8M | -22.3% | +46.3% | Source |
| FY2023 | $1.6B | -$985.3M | -62.1% | +17.7% | Source |
| FY2022 | $1.3B | -$707.4M | -52.4% | +55.0% | Source |
| FY2021 | $870.5M | -$441M | -50.7% | +70.8% | Source |
| FY2020 | $509.5M | -$112.6M | -22.1% | +92.7% | Source |
| FY2019 | $264.4M | -$120.5M | -45.6% | — | Source |
Klarna
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2025 | $3.5B | -$273M | -7.8% | +24.8% | Source |
| FY2024 | $2.8B | $21M | 0.7% | +23.5% | Source |
| FY2023 | $2.3B | -$244M | -10.7% | — | Source |
Where the revenue comes from
Affirm
- Merchant network revenue
Not separately reported as a percentage
Fees earned when merchants use Affirm's payment network to facilitate transactions.
- Card network revenue
Not separately reported as a percentage
Network revenue associated with virtual cards and Affirm Card transactions.
- Interest income
Not separately reported as a percentage
Interest earned on loans held for investment.
- Gain on sales of loans
Not separately reported as a percentage
Gains recognized when Affirm sells loans to third-party investors.
- Servicing income
Not separately reported as a percentage
Fees earned for servicing loans owned by third parties.
Klarna
- Merchant fees
Fees charged to merchants on Klarna transactions; the largest source of revenue.
- Consumer interest and fees
Interest on Fair Financing and other credit products, plus late fees where permitted.
- Card and memberships
Interchange from the Klarna Card and subscription revenue from Memberships, which grew more than 600% in Q2 2026.
- Advertising and other
Sponsored placements and affiliate revenue in the Klarna app.
Business model and strategy
Affirm
How it makes money
Affirm earns merchant-network revenue when consumers use its payment options, interest income on interest-bearing loans, card-network revenue, gains when it sells loans to third parties, and servicing income. Some plans carry 0% APR, while interest-bearing loans disclose a fixed repayment schedule. Affirm says it does not charge late or hidden fees.
Growth strategy
Affirm's disclosed growth priorities include increasing transaction frequency, expanding Affirm Card, adding merchants and platform integrations, entering additional markets, and maintaining diverse funding sources for originated loans.
Competitive advantage
Affirm underwrites each transaction individually in real time and offers fixed payment schedules without late fees. Its distribution includes integrations with major commerce platforms and merchants, while its funding model uses warehouse facilities, securitizations, and loan-sale partnerships.
Klarna
How it makes money
Klarna earns money on both sides of a purchase. Merchants pay Klarna a fee on each transaction because offering installments tends to lift conversion and basket size; Klarna pays the merchant upfront and carries the repayment risk (its published US standard rate for Pay in 4 has been 3.29% plus $0.30).
Growth strategy
Klarna calls itself an 'everyday finance network'. The strategy has three parts: distribution through large acquirers and platforms (J.P. Morgan Payments went live in August 2026), higher-frequency products such as the Klarna Card and paid Memberships (2 million subscribers in Q2 2026, eight times a year earlier), and higher-yield lending such as Fair Financing, which 256,000 merchants offered by Q2 2026.
Competitive advantage
Klarna's edge is scale and funding. It reaches more than 120 million active consumers and over 1.2 million merchants in 26 markets, and distribution deals with payment platforms such as J.P. Morgan Payments, Stripe and Adyen switch Klarna on for merchants without a new integration.
Questions about Affirm vs Klarna
Which company has higher revenue — Affirm Holdings, Inc. or Klarna Group plc?
Affirm Holdings, Inc. reported $4.3B (FY2026), while Klarna Group plc reported $3.5B (FY2025). By last reported revenue, Affirm Holdings, Inc. is the larger business, with Klarna Group plc reporting a smaller revenue base. Note: these are from different fiscal years and are not a direct like-for-like comparison.
What is the market cap of Affirm Holdings, Inc. vs Klarna Group plc?
Affirm Holdings, Inc.'s market capitalisation stands at $24.0B, while Klarna Group plc's is $5.2B. Affirm Holdings, Inc. carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to Klarna Group plc.
Which is more financially efficient — Affirm Holdings, Inc. or Klarna Group plc?
Affirm Holdings, Inc. generates $1.81M / employee in revenue per employee, while Klarna Group plc generates $1.24M / employee. Affirm Holdings, Inc. shows higher revenue efficiency per headcount, though this reflects business model differences — capital-light software companies routinely outperform labour-intensive manufacturers on this metric.
How do Affirm Holdings, Inc. and Klarna Group plc make money?
Affirm Holdings, Inc. and Klarna Group plc generate revenue in fundamentally different ways. Affirm Holdings, Inc.: Affirm earns merchant-network revenue when consumers use its payment options, interest income on interest-bearing loans, card-network revenue, gains when it sells loans to third parties, and servicing income. Klarna Group plc: Klarna earns money on both sides of a purchase.
Which company is valued higher relative to revenue — Affirm Holdings, Inc. or Klarna Group plc?
On a price-to-sales (P/S) basis, Affirm Holdings, Inc. trades at 5.6x P/S and Klarna Group plc at 1.5x P/S. Affirm Holdings, Inc. commands a higher revenue multiple, typically indicating that investors expect faster growth or higher future margins compared to Klarna Group plc. A higher multiple is not inherently better — it may also signal that the stock is priced for perfection.
Is Affirm Holdings, Inc. bigger than Klarna Group plc?
By last reported revenue, Affirm Holdings, Inc. ($4.3B (FY2026)) is the larger company compared to Klarna Group plc ($3.5B (FY2025)). Revenue scale is one dimension of size — market capitalisation, employee count, and geographic reach are also relevant depending on the context.
Figures come from each company's filings and the sources linked beside them. Amounts reported in another currency are shown in US dollars at an approximate rate and marked with ~. Back to the Affirm vs Klarna overview