Internet losses at Swedish funds supplier Klarna quadrupled in a bruising first half throughout which the valuation of Europe’s one-time most useful non-public tech plummeted.

The funds firm on Wednesday reported a internet lack of SKr6.2bn ($581mn) for the primary half of 2022, in contrast with SKr1.4bn a yr earlier.

It attributed the deepening losses to increased workers prices, investments in integrating newly acquired Swedish value comparability service PriceRunner and rising credit score losses. It blamed the upper credit score losses on the challenges of underwriting new clients with restricted credit score histories.

Revenues elevated 24 per cent yr on yr to SKr9.1bn, pushed by development in markets together with the US, the place Klarna has constructed up 30mn customers — a fifth of its international complete. It has additionally expanded into new nations together with the Czech Republic, Canada and Greece.

“Klarna has been working in a really totally different surroundings within the first half of 2022,” stated Sebastian Siemiatkowski, chief government and co-founder. “Once we set our enterprise plans for 2022 within the autumn of final yr, it was a really totally different world than the one we’re in right now.”

Klarna’s struggles mirror challenges dealing with the broader purchase now, pay later sector, as decrease shopper spending and better regulatory scrutiny hit the favored credit score merchandise, which permit shoppers to defer or divide funds into instalments.

After a number of makes an attempt to boost money at increased valuations failed, the worth of Klarna’s shares slumped in July to $7bn after it raised $800mn from traders together with Sequoia and Mubadala, the Abu Dhabi sovereign wealth fund.

Klarna secured a valuation of $46bn as not too long ago as June final yr, following a $639mn funding spherical led by Japan’s SoftBank, the funding group behind a disastrous guess in office-sharing group WeWork.

The corporate slashed its workforce by 10 per cent in Could as Siemiatkowski stated it will give attention to “short-term profitability”. Klarna has not been worthwhile since 2019.