Klarna vs Microsoft: Revenue, Profit and Business Model
Klarna reported $3.5B of revenue in FY2025 and a net loss of $273M. Microsoft reported $331.8B of revenue in FY2026 and $133.7B of net income.
Latest financial snapshot
Financial summary
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.
Microsoft
Microsoft's FY2026 revenue rose 17.8% to $331.8 billion, operating income rose 21% to $155.2 billion, and GAAP net income rose 31% to $133.7 billion. Fourth-quarter revenue was $90.0 billion (up 18%) with net income of $35.8 billion, helped by a $3.2 billion gain on its Anthropic investment. Microsoft Cloud revenue reached $59.3 billion in Q4, up 27%. The main pressure point is capital intensity: AI data center spending has pushed free cash flow growth well below earnings growth.
Revenue and profit by year
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 |
Microsoft
| Year | Revenue | Net income | Margin | Growth | Source |
|---|---|---|---|---|---|
| FY2026 | $331.8B | $133.7B | 40.3% | +17.8% | Source |
| FY2025 | $281.7B | $101.8B | 36.1% | +14.9% | Source |
| FY2024 | $245.1B | $88.1B | 36.0% | +15.7% | Source |
| FY2023 | $211.9B | $72.4B | 34.1% | +6.9% | Source |
| FY2022 | $198.3B | $72.7B | 36.7% | +18.0% | Source |
| FY2021 | $168.1B | $61.3B | 36.5% | +17.5% | Source |
| FY2020 | $143B | $44.3B | 31.0% | +13.6% | Source |
| FY2019 | $125.8B | $39.2B | 31.2% | +14.0% | Source |
| FY2018 | $110.4B | $16.6B | 15.0% | +14.3% | Source |
| FY2017 | $96.6B | $25.5B | 26.4% | — | Source |
Where the revenue comes from
Klarna
- Merchant fees
Not formally reported
Fees charged to merchants on Klarna transactions; the largest source of revenue.
- Consumer interest and fees
Not formally reported
Interest on Fair Financing and other credit products, plus late fees where permitted.
- Card and memberships
Not formally reported
Interchange from the Klarna Card and subscription revenue from Memberships, which grew more than 600% in Q2 2026.
- Advertising and other
Not formally reported
Sponsored placements and affiliate revenue in the Klarna app.
Microsoft
- Productivity And Business ProcessesMajor
Office, Microsoft 365, LinkedIn, Dynamics, and related cloud services.
- Intelligent CloudMajor
Azure, server products, enterprise services, and cloud infrastructure.
- More Personal ComputingMajor
Windows, devices, gaming, search, and advertising.
- AI Services And CopilotsGrowth
AI features and model-powered services embedded across Azure, Microsoft 365, GitHub, security, and developer tools.
Business model and strategy
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.
Microsoft
How it makes money
Microsoft reports three segments. Intelligent Cloud covers Azure, SQL Server, Windows Server, GitHub, Nuance, and enterprise services; server products and cloud services alone brought in $129.4 billion in FY2026, and Azure passed $100 billion in annual revenue for the first time.
Growth strategy
Microsoft's growth plan centers on AI capacity and AI subscriptions. It is spending heavily on data centers and chips to meet Azure demand that management says remains capacity constrained, and it is selling Microsoft 365 Copilot as a paid add-on, which passed 30 million paid seats by the end of FY2026.
Competitive advantage
Microsoft's main advantage is distribution inside enterprises. Identity (Entra), email and documents (Microsoft 365), collaboration (Teams), developer tools (GitHub, Visual Studio), and cloud infrastructure (Azure) are often bought together, which raises switching costs and lets Microsoft attach new products such as Copilot to existing contracts.
Questions about Klarna vs Microsoft
Which company has higher revenue — Klarna Group plc or Microsoft Corporation?
Klarna Group plc reported $3.5B (FY2025), while Microsoft Corporation reported $331.8B (FY2026). By last reported revenue, Microsoft Corporation 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 Klarna Group plc vs Microsoft Corporation?
Klarna Group plc's market capitalisation stands at $5.2B, while Microsoft Corporation's is $3.83T. Microsoft Corporation carries the higher market valuation, reflecting investors' expectations of its future earnings power relative to Klarna Group plc.
Which is more financially efficient — Klarna Group plc or Microsoft Corporation?
Klarna Group plc generates $1.24M / employee in revenue per employee, while Microsoft Corporation generates $1.49M / employee. Microsoft Corporation 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 Klarna Group plc and Microsoft Corporation make money?
Klarna Group plc and Microsoft Corporation generate revenue in fundamentally different ways. Klarna Group plc: Klarna earns money on both sides of a purchase. Microsoft Corporation: Microsoft reports three segments.
Which company is valued higher relative to revenue — Klarna Group plc or Microsoft Corporation?
On a price-to-sales (P/S) basis, Klarna Group plc trades at 1.5x P/S and Microsoft Corporation at 11.5x P/S. Microsoft Corporation 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 Klarna Group plc bigger than Microsoft Corporation?
By last reported revenue, Microsoft Corporation ($331.8B (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 Klarna vs Microsoft overview