Klarna ditch Salesforce and Workday with AI and turns profitable
GenAI has enabled Klarna to turn profitable, increase revenue per employee and improve efficiency along with reducing costs.
Today’s article isn’t about a tool but a news event that has shaken up the entire SAAS industry.
Klarna, one of the world's largest Buy Now Pay Later company, has decided to end its long-standing partnerships with Salesforce (CRM) and Workday (HRMS software). Additionally, they plan to lay off 50% of their workforce over the next few years.
What’s driving this change is Klarna’s ability to harness Generative AI to build these tools internally at a faster pace. Their strategy is to streamline technology infrastructure by leveraging AI to standardize and simplify processes. Klarna has entered into a strategic partnership with OpenAI at an enterprise level, embedding AI into everything they build and do.
The company’s workforce has already been reduced by 24%, from around 5,000 to 3,800, with plans to further decrease to about 2,000 in the coming years.
So, what impact has this had on Klarna?
As the company prepares for a widely anticipated $20 billion IPO, Klarna reported first-half adjusted profits of $66 million, compared to an adjusted loss of $45 million during the same period in 2023.
These cost-cutting measures have allowed the company to break even after several years of mounting losses, having once been a profitable enterprise. Klarna’s intense focus on AI adoption is arguably unmatched within the payments industry as it readies itself for the public market.
source: Klarna Financial Report
In his letter to shareholders, CEO Siemiatkowski hailed the impact of AI, revealing:
"Our AI assistant now performs the work of 700 employees, reducing the average resolution time from 11 minutes to just 2, while maintaining the same customer satisfaction scores as human agents." - CEO Siemiatkowski
Check out the facts by yourself taken right from Klarna’s share holder report.
source: Klarna Financial Report
Every founders dream is to see their company make profits. We have so many companies that are making billions of dollars in revenue but unable to make profit. Generative AI is one such innovation that when leveraged properly can help the company becoming profitable.
The people who will drive these changes will be smart product managers, forward-thinking entrepreneurs, and operations professionals who understand how to apply generative AI to streamline workflows, build internal tools, and drive business results.
I still see many engineers and companies that are not ready to embrace Generative AI. They see it as a "nice to have" rather than a "must-have." But I strongly believe it’s essential—not just for your product, but for your entire business.
As a no-coder, I’ve been able to build working products and automate tasks that would have otherwise taken days to complete, even for a rough draft.
With tools like Replit Agent, Cursor, and V0.dev, anyone can build their own product. One such product I’ve developed is an AI-powered SOP generator.
Check it out yourself:
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You can create similar tools for your own organization.
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