Klarna Faces Class Action Lawsuits Over Misleading IPO Statements
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jan 05 2026
0mins
Should l Buy KLAR?
Source: PRnewswire
Klarna Group PLC's stock has fallen 7.07% and hit a 52-week low amid ongoing legal challenges.
The company is facing multiple class action lawsuits alleging misleading statements in its IPO documents from September 2025. These lawsuits claim that Klarna failed to disclose significant risks related to its credit loss provisions, which surged by 102% year-over-year shortly after the IPO. This lack of transparency has led to a significant decline in investor confidence and a stock price that now trades well below the initial $40 IPO price.
The implications of these lawsuits could be severe for Klarna, as they not only threaten to undermine investor trust but also pose long-term risks to the company's market reputation and financial stability.
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Analyst Views on KLAR
Wall Street analysts forecast KLAR stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for KLAR is 44.36 USD with a low forecast of 36.00 USD and a high forecast of 55.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
11 Analyst Rating
9 Buy
2 Hold
0 Sell
Strong Buy
Current: 20.350
Low
36.00
Averages
44.36
High
55.00
Current: 20.350
Low
36.00
Averages
44.36
High
55.00
About KLAR
Klarna Group Plc is a United Kingdom-based technology company focused on developing commerce networks. The Company is an artificial intelligence (AI)-powered global payments network and shopping assistant. It provides consumers and merchants with a range of solutions, including payment, advertising and digital retail banking, through several channels. Its online payments solution is designed to bridge uncertainty in the transactions between consumers and merchants by providing short-term credit to consumers interest-free. Its range of payment options allows consumers to purchase what they choose, both online and offline. Its payment solutions include Pay in Full, Pay Later and Fair Financing. Its Pay in Full instantly settles purchases at the time of the transaction. Its Pay Later enables consumers to purchase goods or services at the time of the transaction and pay the full amount at a later date. Its Fair Financing allows consumers to pay for their purchase over a longer duration.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Reminder of Klarna Group Securities Class Action
- Class Action Notice: Rosen Law Firm reminds purchasers of Klarna Group securities that the lead plaintiff deadline for the class action related to the September 2025 IPO is set for February 20, 2026, urging investors to act promptly to participate in the litigation.
- Potential Compensation Opportunity: Investors who purchased Klarna securities may be entitled to compensation without any upfront costs through a contingency fee arrangement, providing a risk-free legal support mechanism that encourages more affected individuals to join the lawsuit.
- Overview of the Lawsuit: The lawsuit alleges that the Registration Statement contained false and misleading statements, failing to disclose the significant risk of Klarna's loss reserves increasing shortly after the IPO, resulting in investor losses once the true information became public.
- Law Firm Background: Rosen Law Firm specializes in securities class actions, having recovered over $438 million for investors in 2019 alone, and was ranked No. 1 by ISS Securities Class Action Services in 2017, demonstrating its strong capabilities and successful track record in this field.
See More
Klarna Group Faces Securities Class Action Lawsuit
- Lawsuit Deadline: ClaimsFiler reminds investors of Klarna Group that they must file lead plaintiff applications by February 20, 2026, to participate in a securities class action lawsuit stemming from the company's September 2025 IPO.
- Legal Allegations: Klarna and certain executives are accused of failing to disclose material information during the class period, violating federal securities laws, particularly underestimating the risk of significant increases in loss reserves shortly after the IPO.
- Investor Losses: The lawsuit claims that due to materially false and misleading public statements by Klarna, investors suffered damages when the true details emerged, highlighting serious deficiencies in the company's risk management practices.
- Legal Support Channels: Investors can visit ClaimsFiler for information, register to submit claims timely, and contact Kahn Swick & Foti, LLC for legal consultations, demonstrating a commitment to protecting investor rights.
See More
Class Action Lawsuit Filed Against Klarna Following IPO Losses
- Class Action Initiated: Bragar Eagel & Squire has filed a class action lawsuit against Klarna in the U.S. District Court for the Eastern District of New York on behalf of investors who purchased shares during the September 10, 2025 IPO, raising serious concerns about the company's financial transparency.
- Allegations of Misrepresentation: The lawsuit alleges that Klarna's Registration Statement contained false and misleading statements, failing to disclose the significant risk of increased loss reserves shortly after the IPO, which led to investor losses once the true information was revealed.
- Stock Price Impact: Klarna launched its IPO selling 34,311,274 shares at $40 each, but following disappointing Q3 2025 results on November 18, 2025, which revealed a substantial increase in credit loss provisions, its stock price fell by 9.3%, from $34.88 to $31.63, indicating market concerns over its financial health.
- Investor Rights Protection: Investors must apply by February 20, 2026, to be appointed as lead plaintiffs in the lawsuit, with Bragar Eagel & Squire offering free consultations to assist affected investors in protecting their legal rights.
See More
Klarna Investors Reminded of Class Action Deadline Post-IPO
- Class Action Reminder: Glancy Prongay Wolke & Rotter LLP reminds investors that February 20, 2026, is the deadline to file a lead plaintiff motion in the class action concerning losses incurred after Klarna Group plc's IPO in September 2025.
- IPO Performance Review: Klarna went public on September 10, 2025, selling 34.3 million shares at $40 each, but since then, the stock has significantly declined, currently closing at $31.63, representing a 21% drop from the IPO price.
- Financial Loss Disclosure: On November 18, 2025, Klarna reported a 39% spike in credit loss provisions due to changes in market and product mix, causing the stock to drop 9.3% on the same day, exacerbating investor losses.
- Lawsuit Allegations: The complaint alleges that Klarna executives failed to disclose the risks associated with rising loss reserves, misleading investors about the company's business outlook and potentially exposing them to greater financial risks.
See More
Klarna Group Faces Class Action Lawsuit
- Class Action Initiated: Bronstein, Gewirtz & Grossman, LLC has announced a class action lawsuit against Klarna Group plc, aiming to recover damages for investors who purchased securities during the September 10, 2025 IPO, highlighting significant investor dissatisfaction with the company's financial transparency.
- Allegations of False Statements: The complaint alleges that Klarna's registration statement contained false and misleading statements, failing to disclose the risk of a substantial increase in loss reserves shortly after the IPO, indicating serious deficiencies in the company's risk management practices.
- Investor Rights Protection: Investors are encouraged to apply to be lead plaintiffs by February 20, 2026, to share in any potential recovery from the lawsuit, demonstrating the legal community's commitment to safeguarding investor rights.
- No-Cost Legal Services: The law firm offers legal representation on a contingency fee basis, meaning they will only charge fees if the claim is successful, thereby reducing the financial burden on investors participating in the lawsuit.
See More
Faruqi & Faruqi Encourages Klarna Investors to Reach Out
- Legal Investigation Initiated: Faruq & Faruqi LLP is investigating potential claims against Klarna Group plc, particularly concerning its September 2025 IPO registration statement, aiming to provide legal support for affected investors.
- Investor Rights Reminder: The firm reminds investors who purchased or acquired Klarna securities during the IPO to contact them by February 20, 2026, to seek the role of lead plaintiff, ensuring their legal rights are protected.
- Securities Class Action: A federal securities class action has been filed against Klarna by Faruqi & Faruqi, indicating that investors may have suffered losses, and the outcome of this lawsuit could significantly impact potential recoveries for investors.
- Direct Contact Channels: Investors can reach out directly to attorney Josh Wilson at 877-247-4292 or 212-983-9330 (Ext. 1310) for more information and to discuss their legal options, ensuring timely action to protect their rights.
See More
Reminder of Klarna Group Securities Class Action
- Class Action Notice: Rosen Law Firm reminds purchasers of Klarna Group securities that the lead plaintiff deadline for the class action related to the September 2025 IPO is set for February 20, 2026, urging investors to act promptly to participate in the litigation.
- Potential Compensation Opportunity: Investors who purchased Klarna securities may be entitled to compensation without any upfront costs through a contingency fee arrangement, providing a risk-free legal support mechanism that encourages more affected individuals to join the lawsuit.
- Overview of the Lawsuit: The lawsuit alleges that the Registration Statement contained false and misleading statements, failing to disclose the significant risk of Klarna's loss reserves increasing shortly after the IPO, resulting in investor losses once the true information became public.
- Law Firm Background: Rosen Law Firm specializes in securities class actions, having recovered over $438 million for investors in 2019 alone, and was ranked No. 1 by ISS Securities Class Action Services in 2017, demonstrating its strong capabilities and successful track record in this field.
See More
Klarna Group Faces Securities Class Action Lawsuit
- Lawsuit Deadline: ClaimsFiler reminds investors of Klarna Group that they must file lead plaintiff applications by February 20, 2026, to participate in a securities class action lawsuit stemming from the company's September 2025 IPO.
- Legal Allegations: Klarna and certain executives are accused of failing to disclose material information during the class period, violating federal securities laws, particularly underestimating the risk of significant increases in loss reserves shortly after the IPO.
- Investor Losses: The lawsuit claims that due to materially false and misleading public statements by Klarna, investors suffered damages when the true details emerged, highlighting serious deficiencies in the company's risk management practices.
- Legal Support Channels: Investors can visit ClaimsFiler for information, register to submit claims timely, and contact Kahn Swick & Foti, LLC for legal consultations, demonstrating a commitment to protecting investor rights.
See More
Class Action Lawsuit Filed Against Klarna Following IPO Losses
- Class Action Initiated: Bragar Eagel & Squire has filed a class action lawsuit against Klarna in the U.S. District Court for the Eastern District of New York on behalf of investors who purchased shares during the September 10, 2025 IPO, raising serious concerns about the company's financial transparency.
- Allegations of Misrepresentation: The lawsuit alleges that Klarna's Registration Statement contained false and misleading statements, failing to disclose the significant risk of increased loss reserves shortly after the IPO, which led to investor losses once the true information was revealed.
- Stock Price Impact: Klarna launched its IPO selling 34,311,274 shares at $40 each, but following disappointing Q3 2025 results on November 18, 2025, which revealed a substantial increase in credit loss provisions, its stock price fell by 9.3%, from $34.88 to $31.63, indicating market concerns over its financial health.
- Investor Rights Protection: Investors must apply by February 20, 2026, to be appointed as lead plaintiffs in the lawsuit, with Bragar Eagel & Squire offering free consultations to assist affected investors in protecting their legal rights.
See More
Klarna Investors Reminded of Class Action Deadline Post-IPO
- Class Action Reminder: Glancy Prongay Wolke & Rotter LLP reminds investors that February 20, 2026, is the deadline to file a lead plaintiff motion in the class action concerning losses incurred after Klarna Group plc's IPO in September 2025.
- IPO Performance Review: Klarna went public on September 10, 2025, selling 34.3 million shares at $40 each, but since then, the stock has significantly declined, currently closing at $31.63, representing a 21% drop from the IPO price.
- Financial Loss Disclosure: On November 18, 2025, Klarna reported a 39% spike in credit loss provisions due to changes in market and product mix, causing the stock to drop 9.3% on the same day, exacerbating investor losses.
- Lawsuit Allegations: The complaint alleges that Klarna executives failed to disclose the risks associated with rising loss reserves, misleading investors about the company's business outlook and potentially exposing them to greater financial risks.
See More
Klarna Group Faces Class Action Lawsuit
- Class Action Initiated: Bronstein, Gewirtz & Grossman, LLC has announced a class action lawsuit against Klarna Group plc, aiming to recover damages for investors who purchased securities during the September 10, 2025 IPO, highlighting significant investor dissatisfaction with the company's financial transparency.
- Allegations of False Statements: The complaint alleges that Klarna's registration statement contained false and misleading statements, failing to disclose the risk of a substantial increase in loss reserves shortly after the IPO, indicating serious deficiencies in the company's risk management practices.
- Investor Rights Protection: Investors are encouraged to apply to be lead plaintiffs by February 20, 2026, to share in any potential recovery from the lawsuit, demonstrating the legal community's commitment to safeguarding investor rights.
- No-Cost Legal Services: The law firm offers legal representation on a contingency fee basis, meaning they will only charge fees if the claim is successful, thereby reducing the financial burden on investors participating in the lawsuit.
See More
Faruqi & Faruqi Encourages Klarna Investors to Reach Out
- Legal Investigation Initiated: Faruq & Faruqi LLP is investigating potential claims against Klarna Group plc, particularly concerning its September 2025 IPO registration statement, aiming to provide legal support for affected investors.
- Investor Rights Reminder: The firm reminds investors who purchased or acquired Klarna securities during the IPO to contact them by February 20, 2026, to seek the role of lead plaintiff, ensuring their legal rights are protected.
- Securities Class Action: A federal securities class action has been filed against Klarna by Faruqi & Faruqi, indicating that investors may have suffered losses, and the outcome of this lawsuit could significantly impact potential recoveries for investors.
- Direct Contact Channels: Investors can reach out directly to attorney Josh Wilson at 877-247-4292 or 212-983-9330 (Ext. 1310) for more information and to discuss their legal options, ensuring timely action to protect their rights.
See More
