Buy now, pay later (BNPL) firm Klarna will let go of 10% of its workforce globally as the company suffers amid a worsening economic outlook, according to a statement issued by the company.
Klarna's LinkedIn page says the company currently employs 7,000 people globally meaning that roughly 700 employees will be affected.
"When we set our business plans for 2022 in the autumn of last year, it was a very different world than the one we are in today," said CEO Sebastian Siemiatkowski in a statement. "Since then, we have seen a tragic and unnecessary war in Ukraine unfold, a shift in consumer sentiment, a steep increase in inflation, a highly volatile stock market and a likely recession."
According to the Swedish press, the message was relayed to employees in a pre-recorded speech by Siemiatkowski at 4pm CET today.
While he notes that the majority of Klarna's employees will not be affected, he says that those are will be invited individually to a meeting where information will be provided regarding their next steps.
Those in Europe will be offered to leave with compensation, while the process for those in other territories will differ depending on the region.
The news follows a Bloomberg report that Klarna saw its borrowing costs climb to record levels as rising interest rates hit the company's debt and equity valuations.