Freedom24 Analysis: Klarna and Revolut Put Europe Back in the Game

By: Trademagazin Date: 2025. 10. 09. 11:23

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A few years ago, the European tech sector was considered by many to be a second-tier sector. The failed IPO wave of 2022-2023 and the closed capital market window predicted the region’s decline. However, 2025 has reversed the trend. Capital is flowing back into Europe, with fintech businesses leading the way, proving that the region is once again capable of attracting the interest of large private and institutional investors. Freedom24, which connects Hungarian investors with global markets, offers practical ideas on how to profit from the resurgence of the European fintech sector.

Klarna: Redefining the Balance Between Growth and Profit

A global digital bank and flexible payments provider, Klarna launched its IPO in September 2025, raising $1.37 billion. Following the IPO, shares rose 30% to $52, valuing the company at around $15 billion. In the first half of 2025, Klarna generated revenue of $1.52 billion (up from $1.33 billion a year earlier), showing strong growth. Although the loss increased to $152 million, the company’s ecosystem of 150 million users, 500,000 partners and 2 million daily transactions offers significant monetization potential in the long term.

The company’s US IPO was also a conscious valuation decision: Klarna entered the market at a 4-5x sales-to-revenue ratio, while its US competitors – such as Affirm and PayPal – trade at a valuation of 9-12x. This valuation differential offers an attractive entry point for investors, provided Klarna can turn its scale into profit.

Revolut and the secondary market: liquidity returns

Also a strong sign is Revolut’s secondary market activity: the company’s valuation has stabilized at around $75 billion after employees sold some of their shares. Revolut has long since moved beyond its neobank role – it now offers a full ecosystem of payments, investment, crypto and lending services, with 60 million users. The fact that its valuation rivals that of large European banks signals a shift in perspective: fintech is no longer just about user growth, but also about competing with traditional financial institutions.