Klarna Faces Class Action Lawsuit Post-IPO with 9.3% Share Price Drop
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 24 2025
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Source: Businesswire
- Class Action Initiation: A class action lawsuit has been filed against Klarna for failing to disclose risks related to its loss reserves during its IPO period from September 7 to December 22, 2025, resulting in significant investor losses.
- IPO Details Revealed: Klarna sold 34,311,274 shares at $40 each during its September 2025 IPO, but subsequent financial results indicated a substantial increase in credit loss provisions, undermining investor confidence.
- Stock Price Volatility: Following the disappointing Q3 2025 results announced on November 18, 2025, Klarna's share price plummeted from $34.88 to $31.63, a decline of approximately 9.3%, reflecting market concerns over its financial health.
- Investor Rights Protection: Investors have until February 20, 2026, to apply for lead plaintiff status, with courts typically appointing those with the largest financial losses to ensure the effectiveness and fairness of the class action lawsuit.
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 47.53 USD with a low forecast of 39.00 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.
16 Analyst Rating
13 Buy
3 Hold
0 Sell
Strong Buy
Current: 28.910
Low
39.00
Averages
47.53
High
55.00
Current: 28.910
Low
39.00
Averages
47.53
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.
