News
Europe’s AI Poster Child Klarna Hits the Brakes on Chatbots
After becoming one of Europe’s early adopters of artificial intelligence, Klarna (KLAR.N) CEO Sebastian Siemiatkowski now admits that the fintech giant may have gone too far in cutting costs by leveraging technology at the expense of service and product quality.
Companies around the world are racing to use AI to improve efficiency, reduce operational costs, and enhance decision-making—but the transition has proven to be challenging.
The Swedish “buy now, pay later” lender Klarna slashed thousands of jobs, moved away from vendors like Salesforce Inc (CRM.N), launched new initiatives, and deployed AI to create marketing campaigns—saving millions in the process. However, it now recognizes that these changes happened too quickly and aggressively.
Speaking to Reuters from New York on Tuesday, Siemiatkowski said, “We probably over-focused on this, and over the past six months, we’ve been trying to correct it.”
He added that the company is now shifting its attention to boosting productivity and improving products for both customers and merchants. These comments were cleared for publication on Wednesday ahead of Klarna’s listing on the New York Stock Exchange.
In its U.S. initial public offering (IPO) on Tuesday, Klarna raised $1.37 billion, valuing the company at $15 billion and setting the stage for a high-growth fintech debut.
Siemiatkowski revealed that last year the company cut its workforce from 5,000 to 3,800 employees and expects further reductions due to AI-driven customer support. Klarna said its chatbot has already replaced the work of 700 employees, reducing average resolution times from 11 minutes to just two.
In May, Klarna used an AI-generated avatar of Siemiatkowski to present its quarterly earnings and launched a hotline that allows customers to interact with a version of him trained on his voice, insights, and experiences.
The company is now hiring again, with more than two dozen job openings listed on its career portal.
Productivity and Growth
Though Klarna saved nearly $2 million by replacing Salesforce with its AI-driven tools, Siemiatkowski acknowledged that investors are more focused on growth than cost-cutting.
He stated, “My investors won’t be happy. They’re looking for growth. They care about what we offer our customers and how it performs.”
Klarna, which revolutionized online shopping with its short-term financing model, is listing in the U.S.—its largest market—where it competes with companies like Affirm (AFRM.O).
Despite scaling back on AI’s role, the company still believes in its potential.
“This is definitely not just a cost-cutting game… it’s far more than that. Over time, it will help us provide better services to consumers and merchants,” CFO Niklas Neglen told Reuters.
Siemiatkowski, who holds about a 7% stake in Klarna, chose not to sell any shares during the IPO—the largest by a Swedish company since Spotify (SPOT.N). Reflecting on the significance of the listing, he remarked, “The IPO means a lot for our employees and shareholders. It’s a bit like a wedding—there’s a big celebration, and then life goes on with families and other things.”
Continuing the achievement of the journey of effectiveness and credibility of more than 10 years in the career of journalism, as a woman journalist, I am Serving as the founder, promoter and editor of DiaryTimes with the trust and support of all. My credible coverage may not have given a big shape to the numbers, but my journey presents articles that make you aware of the exact and meaningful situations of Himachal’s politics, ground issues related to the public, business, tourism and the difficult geographical conditions of the state and financial awareness. DiaryTimes, full of the experience of my precise editorial expertise, is awakening the flame of credible journalism among all of you, so that the eternal flame of meaningful change can be lit in the life of the people of the state and the atrocities being committed against the people can be brought to the fore, I am motivated for that. If even a small change comes with the power of my journalism and the whole world becomes a witness to that issues, then I will consider myself fortunate.
