AFRM Vs KLAR: Which BNPL Stock Is The Better Buy Right Now?

Klarna posted Q2 earnings results last week, beating Wall Street expectations on both topline and bottom line figures, while Affirm is expected to report Q4 results later this week.

• Klarna reported Q2 revenue of $1.04 billion, up 27% year over year, and earnings per share of $0.01.
• Wall Street expects Affirm to report revenue of $1.11 billion for the quarter, up about 27% year over year, and earnings per share of $0.82. 
• AFRM stock has a 12-month average price target of $91.64, implying an upside of more than 19% from its last close, while KLAR stock has a 12-month average price target of $20.16, implying an upside of nearly 43%. 

Affirm Holdings Inc. (AFRM) and Klarna Group plc (KLAR) stocks are in focus amid a busy earnings season, with investors closely watching credit risks and the expanding integrations of the buy now, pay later firms amid a volatile economic environment. 

Klarna posted second-quarter (Q2) earnings results last week, beating Wall Street expectations on both topline and bottom line figures. Meanwhile, Affirm is expected to report its fourth quarter (Q4) results later this week. 

Klarna Q2 Results Snapshot 

The Stockholm, Sweden-based company reported Q2 revenue of $1.04 billion last week, up 27% year over year and ahead of Wall Street estimates of $996.78 million, according to data from Fiscal.ai. Klarna also beat expectations on earnings per share, which came in at $0.01 versus expectations of a loss of $0.06 per share. 

The company posted transaction margin dollars of $88 million, up 126% year-over-year, “more than three times the pace of revenue growth,” CFO Niklas Näglén said during a call with investors. 

However, the company cut its full-year 2026 revenue guidance to between $4.08 billion and $4.16 billion, below consensus estimates, citing $600 million in foreign exchange headwinds and weaker-than-expected German volumes. Klarna also took a cautious view of European volumes for the second half of the year, particularly in Germany, where weaker discretionary spending is expected to persist through year-end.

CEO Sebastian Siemiatkowski said the U.S. was the company’s fastest-growing large region in Q2, delivering gross merchandise volume of $7.9 billion in the region, up 27% year-on-year.

What Is Wall Street Expecting From Affirm?

Affirm will report its Q4 results on Thursday after the bell. Investors will be closely watching the company’s gross merchandise volume (GMV), credit delinquency data, and forward guidance in its upcoming release.

Wall Street expects the company to report revenue of $1.11 billion for the quarter, up about 27% from the $876.42 million revenue posted in the comparable quarter of the previous year, according to data from Fiscal.ai.

Earnings per share is expected to come in at $0.82, compared to $0.53 in Q4 of 2025, implying an expectation of a rise of nearly 57%. 

Meanwhile, as per The Fly, Oppenheimer thinks the company is unlikely to guide fiscal 2027 meaningfully above its recently introduced medium-term outlook of 25%-plus GMV growth, but added that the firm sees potential for actual GMV growth to come in stronger.

Oppenheimer also said that it expects results to meet or exceed the top end of guidance across revenue less transaction costs and adjusted operating income. 

AFRM Vs Klar: Wall Street View

Oppenheimer analyst Rayna Kumar raised the price target on AFRM stock to $100 from $87 and kept an ‘Outperform’ rating. The revised outlook implies about 30% upside from its last close.

The firm said that it believes Affirm is positioned to deliver strong Q4 results, supported by positive Buy Now, Pay Later industry momentum and a consistent track record of outperformance. 

According to Koyfin data, 34 analysts covering the stock have a 12-month average price target of $91.64, implying upside of more than 19% from its last close. 

Meanwhile, KLAR stock has recently received a series of price target cuts following its lowered guidance. 

Last week, UBS analyst Timothy Chiodo downgraded Klarna to ‘Neutral' from ‘Buy’ with a price target of $16, down from $23, as per The Fly. The revised target still implies an upside of more than 13% on the company’s shares compared to its last close. 

The analyst said that while it continues to see numerous positives for Klarna, the downward revision of its GMV for the second half of 2026 suggests a meaningful downtick in international growth expectations, particularly in Germany. The firm also noted management transition as a concern, citing the departure of its long-time chief financial officer and chief marketing officer. 

Keefe Bruyette also lowered the firm's price target on Klarna to $21 from $26 and maintained an ‘Outperform’ rating on the shares.

As per Koyfin data, 22 analysts covering the stock have a 12-month average price target of $20.16, implying an upside of nearly 43%. 

How Have The Stocks Performed Recently?

In 2026, AFRM stock has outperformed KLAR stock, posting gains of more than 3% year to date. Meanwhile, KLAR stock is down more than 51% in the same period. 

AFRM Vs KLAR: Retail Stance

On Stocktwits, retail sentiment around AFRM stock was ‘bullish’ at the time of writing amid ‘normal’ message volumes. 

Meanwhile, retail sentiment for KLAR stock is ‘extremely bullish’ amid ‘extremely high’ message volume. 

One user said, “$KLAR the market is down.  This still holds up well.”

Another user said, “$AFRM earnings will be out on 26th. Afrm never returns (to) double digits after. To triple digits.” 

A third user said, “IMO, $KLAR and $AFRM are on the same level. $AFRM has more presence in the US but $KLAR has more presence globally. But current market doesn't treat it this way. $SEZL is another competitor that is smaller with faster growth but not at the same level as $KLAR and $AFRM.”

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