Klarna Faces IPO Lawsuit Over Credit-Risk Disclosures After Loss Provisions Surge

Overview

• Investors filed a securities class action styled Nayak v. Klarna Group plc, No. 1:25-cv-07033, in the Eastern District of New York alleging Securities Act violations tied to the September 2025 IPO.
• The complaint targets Klarna, certain executives and directors, authorized representatives, and the IPO underwriters over alleged misstatements or omissions about credit risk and loss reserves.
• Klarna’s November 18, 2025 Q3 results showed a net loss of about $95 million and provisions for loan losses of roughly $235 million, including a reported 102% year-over-year jump in credit-loss provisions.
• Plaintiffs say risks linked to BNPL and the Fair Financing offering, as well as claims about credit modeling performance, were understated in the registration statement and prospectus.
• The stock fell to the low $31 range from the $40 IPO price, and multiple firms are recruiting class members, with a February 20, 2026 deadline to seek lead-plaintiff appointment.