Klarna crashed 21% after slashing FY26 revenue guidance to a range of $4.08B to $4.16B, despite posting a Q2 beat with $1.04B in revenue, up 27%. Affirm and PayPal held flat to higher Tuesday, signaling markets view Klarna's German volume slump as company-specific, not a BNPL sector problem. Act now: the analyst who called NVIDIA in 2010 just named his top 10 AI stocks — and PayPal didn't make the cut.
Grab the names FREE today. Klarna Group (NYSE:KLAR) stock is down 19% to $15.84 Tuesday morning after the buy now, pay later company cut its full-year revenue and volume outlook, overshadowing a Q2 2026 beat and raised profit guidance. Klarna stock is on track for its biggest single-day drop in nearly six months.
The reaction stands apart from peers. Affirm (NASDAQ:AFRM) stock is up 0.5% to $74.9, while Sezzle (NASDAQ:SEZL) stock is down 0.6% to $121.5 and PayPal (NASDAQ:PYPL) stock is up 2% to $61.41. Through Monday's close, Klarna stock was down 33% year to date (YTD), Affirm stock sat up 0.1% YTD, Sezzle stock was up 92% YTD, and PayPal stock was up 4% YTD.
Tuesday's split confirms single-name positioning around Klarna rather than sector-wide pressure. Klarna's Q2 2026 report beat on every headline. The company's revenue came in at $1.04 billion, up 27% year over year (YoY), topping the $996 million consensus, and adjusted earnings of $0.01 per share beat a consensus loss of $0.06.
The company's gross merchandise volume reached $36.6 billion, up 18% YoY. Klarna's transaction margin dollars landed at $446 million, up 42% YoY and equal to 42.8% of revenue. The company's U.S. revenue rose 37% to $376 million, and merchants on the platform grew 54% YoY to more than 1.2 million.
The catalyst is the full-year cut. Klarna now guides FY26 GMV to $149 billion to $151 billion, from a prior view above $155 billion and revenue to $4.08 billion to $4.16 billion, from a prior view above $4.34 billion. The company attributes $600 million of the reduction to currency.
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