Klarna's stock price rises 4% due to expanded $2 billion partnership with Elliott

Investing.com – Klarna’s stock price rose 4% after the digital payments provider announced it would double its financing limit with Elliott Investment Management to $2 billion and extend the partnership to support up to $17 billion in U.S. loans.

The expanded agreement extends the term by one year to three years and builds on the partnership first announced in November 2025. Under this arrangement, Klarna will roll over the newly issued U.S. receivables into funds managed by Elliott, providing off-balance-sheet financing while maintaining underwriting and servicing control.

The increase in the financing limit comes after strong performance in Klarna’s U.S. financing business, which saw significant growth in gross merchandise volume in Q4 2025. The company stated that the increased limit will help meet the growing demand from consumers for its financing products.

Klarna’s Chief Financial Officer Niclas Neglen commented, “Klarna’s U.S. financing business is growing rapidly because it offers Americans something the credit card industry has never provided: real choice, transparent terms, and zero surprises. This partnership lays the foundation for us to meet the increasing needs of U.S. consumers.”

This forward-flow and full-loan sale structure allows Klarna to expand its U.S. lending business without increasing assets on its balance sheet. As the underlying loans amortize over the three-year period, new loans will continue to flow into the financing limit, enabling the company to issue up to $17 billion in U.S. financing loans during the remaining term of the program.

As Klarna continues to expand its presence in the U.S. market, this partnership expansion provides additional financial flexibility as its installment products compete with traditional credit cards.

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