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Klarna just announced its first quarter 2025 financial results, and they show that a larger chunk of customers are buying now and not paying later. This morning, the Swedish buy now, pay later (BNPL) fintech company gave consumers a look at its performance for the first three months of 2025. The news came in the form of a press release and an accompanying AI-generated video of CEO Sebastian Siemiatkowski (likely as a play to emphasize Klarnas all-in approach to AI.) In the video, Siemiatkowskis look-alike shared that Klarna has started the year strong, hitting 100 active users in the first quarter and $701 million in revenue, a 15% year-over-year increase. But theres a caveat: Although Klarna has grown this year, its also doubled its net losses from $47 million in Q1 2024 to $99 million in Q1 2025. One factor driving the spike in losses appears to be the fact that more of Klarnas consumer base, which relies on the companys fast-credit loans to pay for goods in bite-size installments, is failing to pay off their purchases. The results come as, amid a global trade war and increasing economic uncertainty, U.S. consumers are turning to BNPL services to pay for everything from electronics to groceries. Buy now, don’t pay later? A University of Michigan survey, released last week, found that U.S. consumer sentiment dropped to its second-lowest reading on record this month amid fears that the Trump administrations tariffs will lead to a spike in inflation. Between tariff concerns and the current elevated cost of living, its been a difficult few months for American consumers. Now, it seems, Klarnas customers are beginning to show the strain. According to a press release detailing its Q1 results, Klarnas consumer credit losses have jumped 17%from $117 million last year to $136 million this yearas more users fail to make their payments on time. That data is on track with an April survey from LendingTree that found that 41% of BNPL users in the U.S. paid late over the last 12 months, up from 34% a year ago. Still, for BNPL providers like Klarna, its not a bad time to be in the business. A report from Grand View Research found the U.S. BNPL market is expected to see a 26.1% annual compound growth rate between 2023 and 2030. And, based on the aforementioned LendingTree data, that market prediction is already beginning to play out: Consumers are increasingly relying on BNPL services for quotidian purchases like groceries and food delivery. (As of that survey, 25% of users had purchased groceries with a BNPL loan, up 14% from 2024.) Klarna, specifically, has recently announced major deals with DoorDash, Walmart, and eBay to cash in on the growing demand for BNPL services. Experts warn that this reliance on BNPL is a worrisome sign. Last month, Matt Schulz, LendingTrees chief consumer finance analyst, told CNBC that high interest rates, inflation, and tariff uncertainty were leading consumers to look for ways to extend their budget however they can. Still, in the fintech world, Klarna is becoming a more prominent player. Investors are waiting with bated breath for the company to move ahead with an IPO, a process that Klarna moved to begin in March but ultimately put on hold in order to await a clearer tariff outlook.
Category:
E-Commerce
The U.S. Supreme Court let Donald Trump’s administration on Monday strip temporary protected status from Venezuelans living in the United States that had been granted under his predecessor Joe Biden, as the Republican president moves to ramp up deportations as part of his hard-line approach to immigration. The court granted the Justice Department’s request to lift San Francisco-based U.S. District Judge Edward Chen’s order that had halted Homeland Security Secretary Kristi Noem’s decision to terminate the deportation protection conferred to Venezuelans under the temporary protected status, or TPS, program. The court’s brief order was unsigned, as is typical when the justices act on an emergency request. The court, however, left open the door to any challenges by migrants if the administration seeks to invalidate work permits or other TPS-related documents that were issued to expire in October 2026, which is the end of the TPS period extended by Biden. The Department of Homeland Security has said about 348,202 Venezuelans were registered under Biden’s 2023 TPS designation. Liberal Justice Ketanji Brown Jackson was the sole member of the court to publicly dissent from the decision. The action came in a legal challenge by plaintiffs including some of the TPS recipients and the National TPS Alliance advocacy group, who said Venezuela remains an unsafe country. Trump, who returned to the presidency in January, has pledged to deport record numbers of migrants in the United States illegally and has taken actions to strip certain migrants of temporary legal protections, expanding the pool of possible deportees. The TPS program is a humanitarian designation under U.S. law for countries stricken by war, natural disaster, or other catastrophe, giving recipients living in the United States deportation protection and access to work permits. The designation can be renewed by the U.S. homeland security secretary. The U.S. government under Biden, a Democrat, twice designated Venezuela for TPS, in 2021 and 2023. In January, days before Trump returned to office, the Biden administration announced an extension of the programs to October 2026. Noem, a Trump appointee, rescinded the extension and moved to end the TPS designation for a subset of Venezuelans who benefited from the 2023 designation. Chen ruled that Noem violated a federal law that governs the actions of agencies. The judge also said the revocation of the TPS status appeared to have been predicated on “negative stereotypes” by insinuating the Venezuelan migrants were criminals. “Generalization of criminality to the Venezuelan TPS population as a whole is baseless and smacks of racism predicated on generalized false stereotypes,” Chen wrote, adding that Venezuelan TPS holders were more likely to hold bachelor’s degrees than American citizens and less likely to commit crimes than the general U.S. population. The San Francisco-based 9th U.S. Circuit Court of Appeals on April 18 declined the administration’s request to pause the judge’s order. Justice Department lawyers in their Supreme Court filing said Chen had “wrested control of the nation’s immigration policy” away from the government’s executive branch, headed by Trump. “The court’s order contravenes fundamental Executive Branch prerogatives and indefinitely delays sensitive policy decisions in an area of immigration policy that Congress recognized must be flexible, fast-paced, and discretionary,” they wrote. The plaintiffs told the Supreme Court that granting the administration’s request “would strip work authorization from nearly 350,000 people living in the U.S., expose them to deportation to an unsafe country, and cost billions in economic losses nationwide.” The State Department currently warns against travel to Venezuela “due to the high risk of wrongful detentions, terrorism, kidnapping, the arbitrary enforcement of local laws, crime, civil unrest, and poor health infrastructure.” The Trump administration in April also terminated TPS for thousands of Afghans and Cameroonians in the United States. Those actions are not part of the current case. In a separate case on Friday, the Supreme Court kept in place its block on Trump’s deportations of Venezuelan migrants under a 1798 law historically used only in wartime, faulting his administration for seeking to remove them without adequate legal process. Andrew Chung, Reuters
Category:
E-Commerce
Libraries across the United States are cutting back on e-books, audiobooks, and loan programs after the Trump administration suspended millions of dollars in federal grants as it tries to dissolve the Institute of Museum and Library Services. Federal judges have issued temporary orders to block the Trump administration from taking any further steps toward gutting the agency. But the unexpected slashing of grants has delivered a significant blow to many libraries, which are reshuffling budgets and looking at different ways to raise money. Maine has laid off a fifth of its staff and temporarily closed its state library after not receiving the remainder of its annual funding. Libraries in Mississippi have indefinitely stopped offering a popular e-book service, and the South Dakota state library has suspended its interlibrary loan program. E-book and audiobook programs are especially vulnerable to budget cuts, even though those offerings have exploded in popularity since the COVID-19 pandemic. I think everyone should know the cost of providing digital sources is too expensive for most libraries,” said Cindy Hohl, president of the American Library Association. Its a continuous and growing need. Library officials caught off guard by Trump’s cuts President Donald Trump issued an executive order March 14 to dismantle the IMLS before firing nearly all of its employees. One month later, the Maine State Library announced it was issuing layoff notices for workers funded through an IMLS grant program. It came as quite a surprise to all of us, said Spencer Davis, a library generalist at the Maine State Library who is one of eight employees who were laid off May 8 because of the suspended funding. In April, California, Washington, and Connecticut were the only three states to receive letters stating the remainder of their funding for the year was canceled, Hohl said. For others, the money hasnt been distributed yet. The three states all filed formal objections with the IMLS. Rebecca Wendt, California state library director, said she was never told why California’s funding was terminated while the other remaining states did not receive the same notice. We are mystified, Wendt said. The agency did not respond to an email seeking comment. Popular digital offerings on the chopping block Most libraries are funded by city and county governments, but receive a smaller portion of their budget from their state libraries, which receive federal dollars every year to help pay for summer reading programs, interlibrary loan services, and digital books. Libraries in rural areas rely on federal grants more than those in cities. Many states use the funding to pay for e-books and audiobooks, which are increasingly popular, and costly, offerings. In 2023, more than 660 million people globally borrowed e-books, audiobooks, and digital magazines, up from 19% in 2022, according to OverDrive, the main distributor of digital content for libraries and schools. In Mississippi, the state library helped fund its statewide e-book program. For a few days, Erin Busbea was the bearer of bad news for readers at her Mississippi library: Hoopla, a popular app to check out e-books and audiobooks had been suspended indefinitely in Lowndes and DeSoto counties due to the funding freeze. People have been calling and asking, Why cant I access my books on Hoopla? said Busbea, library director of the Columbus-Lowndes Public Library System in Columbus, a majority-Black city northeast of Jackson. The library system also had to pause parts of its interlibrary loan system allowing readers to borrow books from other states when they aren’t available locally. For most libraries that were using federal dollars, they had to curtail those activities,” said Hulen Bivins, the Mississippi Library Commission executive director. States are fighting the funding freeze The funding freeze came after the agency’s roughly 70 staff members were placed on administrative leave in March. Attorneys general in 21 states and the American Library Association have filed lawsuits against the Trump administration for seeking to dismantle the agency. The institute’s annual budget is below $300 million and distributes less than half of that to state libraries across the country. In California, the state library was notified that about 20%, or $3 million, of its $15 million grant had been terminated. The small library systems are not able to pay for the e-books themselves, said Wendt, the California state librarian. In South Dakota, the state’s interlibrary loan program is on hold, according to Nancy Van Der Weide, a spokesperson for the South Dakota Department of Education. The institute, founded in 1996 by a Republican-controlled Congress, also supports a national library training program named after former first lady Laura Bush that seeks to recruit and train librarians from diverse or underrepresented backgrounds. A spokesperson for Bush did not return a request seeking comment. Library funding is never robust. It’s always a point of discussion. It’s always something you need to advocate for, said Liz Doucett, library director at Curtis Memorial Library in Brunswick, Maine. It’s adding to just general anxiety.” Nadia Lathan, Associated Press/Report for America Lathan is a corps member for the Associated Press/Report for America Statehouse News Initiative. Report for America is a nonprofit national service program that places journalists in local newsrooms to report on undercovered issues.
Category:
E-Commerce
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