Klarna CEO Sebastian Siemiatkowski is so bullish on artificial intelligence that the Swedish buy now, pay later (BNPL) platform plans to cut 50% of its workforce over the next few years.
Towards financial timesSiemiatkowski said Klarna hopes to reduce its headcount from 3,800 to 2,000 employees. Klarna’s current headcount has been reduced from 5,000 following major redundancies last year. Siemiatkowski plans to shift nearly half of the company’s customer service and marketing responsibilities to artificial intelligence. “Not only can we do more with less, we can do more with less,” he said financial times.
How does “Buy Now, Pay Later” work?
None of this comes out of nowhere. Siemiatkowski has been outspoken about the cost-saving benefits of artificial intelligence. Klarna implemented a hiring freeze last December with the ultimate goal of “downsizing” the company and replacing certain tasks with artificial intelligence. In a now-deleted archived post on There was a backlash.
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In the short term, Klarna’s approach appears to be paying off. BNPL’s net loss narrowed sharply from $84 million to $980,000 after converting Swedish krona into U.S. dollars, according to reports on Tuesday’s second-quarter earnings call. But betting big on AI automation is a gamble that may not pan out. Economic experts in the Goldman Sachs report argue that “artificial intelligence will have limited benefits for the U.S. economy,” and if history tells us anything, the automation of certain services, such as self-checkout kiosks and customer service, could backfire and create new problems.
Klarna isn’t the only tech company cutting jobs to invest in artificial intelligence. In January, Duolingo laid off 10% of its contractors, blaming artificial intelligence for the layoffs. As Meta and Google increase their investment in artificial intelligence, they also cut jobs.
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