Connect with us

Published

on

The Swedish “buy now, pay later” pioneer said Tuesday that its new design would help users find the items they want by using more advanced AI recommendation algorithms, while merchants will be able to target customers more effectively.

Rafael Henrique | SOPA Images | LightRocket via Getty Images

Swedish technology startup Klarna is looking to take on big U.S. tech giants with its own artificial intelligence-powered image recognition tool to help people find products they want to buy.

The feature, which Klarna rolled out Wednesday, will enable users to point their phone at an item of clothing or an electronics product and find results for similar items directly within the Klarna app.

It’s similar to how Google Lens directs users to suggestions based on items captured by their camera.

The tool is trained on data from PriceRunner, a price comparison service Klarna acquired for close to $1 billion.

PriceRunner competes with the likes of Amazon, Google’s shopping comparison service Google Shopping, and French-founded firm Kelkoo.

We see AI as a huge opportunity for Klarna and the way we are approaching it is to provide everyone at Klarna with the tools and support to use AI in their day-to-day jobs,” David Sandstrom, Klarna’s chief marketing officer, told CNBC.

“Our unique operating model gives us the agility to take advantage of emerging opportunities that deliver superior consumer benefits, such as AI, faster than sprawling traditional banks and credit card companies.”

Klarna users will be able to point their phone at an item of clothing or gadget and find recommendations on similar products directly within the Klarna app.

Klarna

Sandstrom said the appeal of Klarna’s image recognition tech over Google is that Klarna is focusing more specifically on a shopping experience rather than pointing users toward more general search results on the web.

AI push

Klarna, which was founded in Stockholm in 2005, exploded in popularity over the Covid-19 pandemic as more and more people turned to online shopping to fill up their wardrobes.

The company’s zero-interest credit model proved particularly popular for younger, less affluent consumers lacking the credit history to successfully apply for a credit card.

The company’s market value ballooned to $46 billion at the peak of the low interest rate-fueled tech stock frenzy.

Since then, Klarna has had a tougher time in the market, with its valuation sinking 85% to $6.7 billion. The company also laid off 10% of its global workforce last year.

This year, Klarna has been looking to AI to help it become a leaner business as it, like plenty of other fintech firms, pushes aggressively toward profitability.

In August, Klarna reported a single month of profit in the first half of 2023, marking a return to profitability for the firm for the first time since it slipped into the red in 2020.

Klarna says that more than 2,500 of its total 5,000 employees have access to the OpenAI API, which allows them to integrate the Microsoft-backed company’s technology directly into their own tools and services.

Still, regulators, not least the European Union, have become wary about the rapid advancement of generative AI technology, which generates new material in response to human inputs.

Sandstrom urged Europe not to risk falling behind in the global race toward AI.

“I still have my hopes up when it comes to Europe,” he told CNBC. “I think we take a lot of inspiration on what is coming out of China. They have their benefits when it comes to progress there.”

“A lot is obviously happening in Silicon Valley as well, but there is no rational reason why Europe should be behind.”

“I also think the world in general needs to lean into AI and start working with it and see where it can go right and where it can go wrong before passing judgment,” Sandstrom added. “Currently, I think it’s way too premature.”

Focus on shopping

Klarna has for years offered users the ability to pay for items over installments using a model known as “buy now, pay later.” But it has been increasingly trying to build out its offering to include more features specific to shopping.

The company overhauled its app in April this year with new features for personalizing users’ feeds to help them find the items they want with more advanced AI recommendation algorithms, inspired in no small part by TikTok’s addictive discovery algorithm.

Klarna is also rolling out a few other updates Wednesday. One big one is the expansion of shoppable videos in Europe. It’s a feature Klarna first brought out in the U.S.

With it, shoppers in Europe will now be able to view unboxing videos, tutorials, reviews and other clips from Klarna merchants and the firm’s own network of content creators.

Klarna is seeking to tap into the growing creator economy, tapping social media influencers with sway over consumer purchasing decisions to make its mark in the e-commerce world.

Klarna also launched its own cashback rewards program, Klarna Cash. Starting with the U.K., but rolling out to other markets in the future, Klarna Cash will allow shoppers to earn up to 10% of their purchase amount back when they pick pay now, pay in three, or pay later at the checkout of retailers with active offers.

Participating retailers will include Farfetch, River Island, The North Face and Hotels.com.

Continue Reading

Technology

Google agrees to pay Texas $1.4 billion data privacy settlement

Published

on

By

Google agrees to pay Texas .4 billion data privacy settlement

A Google corporate logo hangs above the entrance to the company’s office at St. John’s Terminal in New York City on March 11, 2025.

Gary Hershorn | Corbis News | Getty Images

Google agreed to pay nearly $1.4 billion to the state of Texas to settle allegations of violating the data privacy rights of state residents, Texas Attorney General Ken Paxton said Friday.

Paxton sued Google in 2022 for allegedly unlawfully tracking and collecting the private data of users.

The attorney general said the settlement, which covers allegations in two separate lawsuits against the search engine and app giant, dwarfed all past settlements by other states with Google for similar data privacy violations.

Google’s settlement comes nearly 10 months after Paxton obtained a $1.4 billion settlement for Texas from Meta, the parent company of Facebook and Instagram, to resolve claims of unauthorized use of biometric data by users of those popular social media platforms.

“In Texas, Big Tech is not above the law,” Paxton said in a statement on Friday.

“For years, Google secretly tracked people’s movements, private searches, and even their voiceprints and facial geometry through their products and services. I fought back and won,” said Paxton.

“This $1.375 billion settlement is a major win for Texans’ privacy and tells companies that they will pay for abusing our trust.”

Google spokesman Jose Castaneda said the company did not admit any wrongdoing or liability in the settlement, which involves allegations related to the Chrome browser’s incognito setting, disclosures related to location history on the Google Maps app, and biometric claims related to Google Photo.

Castaneda said Google does not have to make any changes to products in connection with the settlement and that all of the policy changes that the company made in connection with the allegations were previously announced or implemented.

“This settles a raft of old claims, many of which have already been resolved elsewhere, concerning product policies we have long since changed,” Castaneda said.

“We are pleased to put them behind us, and we will continue to build robust privacy controls into our services.”

Continue Reading

Technology

Virtual chronic care company Omada Health files for IPO

Published

on

By

Virtual chronic care company Omada Health files for IPO

Omada Health smart devices in use.

Courtesy: Omada Health

Virtual care company Omada Health filed for an IPO on Friday, the latest digital health company that’s signaled its intent to hit the public markets despite a turbulent economy.

Founded in 2012, Omada offers virtual care programs to support patients with chronic conditions like prediabetes, diabetes and hypertension. The company describes its approach as a “between-visit care model” that is complementary to the broader health-care ecosystem, according to its prospectus.

Revenue increased 57% in the first quarter to $55 million, up from $35.1 million during the same period last year, the filing said. The San Francisco-based company generated $169.8 million in revenue during 2024, up 38% from $122.8 million the previous year.

Omada’s net loss narrowed to $9.4 million during its first quarter from $19 million during the same period last year. It reported a net loss of $47.1 million in 2024, compared to a $67.5 million net loss during 2023.

The IPO market has been largely dormant across the tech sector for the past three years, and within digital health, it’s been almost completely dead. After President Donald Trump announced a sweeping tariff policy that plunged U.S. markets into turmoil last month, taking a company public is an even riskier endeavor. Online lender Klarna delayed its long-anticipated IPO, as did ticket marketplace StubHub.

But Omada Health isn’t the first digital health company to file for its public market debut this year. Virtual physical therapy startup Hinge Health filed its prospectus in March, and provided an update with its first-quarter earnings on Monday, a signal to investors that it’s looking to forge ahead.

Omada contracts with employers, and the company said it works with more than 2,000 customers and supports 679,000 members as of March 31. More than 156 million Americans suffer from at least one chronic condition, so there is a significant market opportunity, according to the company’s filing.

In 2022, Omada announced a $192 million funding round that pushed its valuation above $1 billion. U.S. Venture Partners, Andreessen Horowitz and Fidelity’s FMR LLC are the largest outside shareholders in the company, each owning between 9% and 10% of the stock.

“To our prospective shareholders, thank you for learning more about Omada. I invite you join our journey,” Omada co-founder and CEO Sean Duffy said in the filing. “In front of us is a unique chance to build a promising and successful business while truly changing lives.”

WATCH: The IPO market is likely to pick up near Labor Day, says FirstMark’s Rick Heitzmann

The IPO market is likely to pick up near Labor Day, says FirstMark's Rick Heitzmann

Continue Reading

Technology

Google would need to shift up to 2,000 employees for antitrust remedies, search head says

Published

on

By

Google would need to shift up to 2,000 employees for antitrust remedies, search head says

Liz Reid, vice president, search, Google speaks during an event in New Delhi on December 19, 2022.

Sajjad Hussain | AFP | Getty Images

Testimony in Google‘s antitrust search remedies trial that wrapped hearings Friday shows how the company is calculating possible changes proposed by the Department of Justice.

Google head of search Liz Reid testified in court Tuesday that the company would need to divert between 1,000 and 2,000 employees, roughly 20% of Google’s search organization, to carry out some of the proposed remedies, a source with knowledge of the proceedings confirmed.

The testimony comes during the final days of the remedies trial, which will determine what penalties should be taken against Google after a judge last year ruled the company has held an illegal monopoly in its core market of internet search.

The DOJ, which filed the original antitrust suit and proposed remedies, asked the judge to force Google to share its data used for generating search results, such as click data. It also asked for the company to remove the use of “compelled syndication,” which refers to the practice of making certain deals with companies to ensure its search engine remains the default choice in browsers and smartphones. 

Read more CNBC tech news

Google pays Apple billions of dollars per year to be the default search engine on iPhones. It’s lucrative for Apple and a valuable way for Google to get more search volume and users.

Apple’s SVP of Services Eddy Cue testified Wednesday that Apple chooses to feature Google because it’s “the best search engine.”

The DOJ also proposed the company divest its Chrome browser but that was not included in Reid’s initial calculation, the source confirmed.

Reid on Tuesday said Google’s proprietary “Knowledge Graph” database, which it uses to surface search results, contains more than 500 billion facts, according to the source, and that Google has invested more than $20 billion in engineering costs and content acquisition over more than a decade.

“People ask Google questions they wouldn’t ask anyone else,” she said, according to the source.

Reid echoed Google’s argument that sharing its data would create privacy risks, the source confirmed.

Closing arguments for the search remedies trial will take place May 29th and 30th, followed by the judge’s decision expected in August.

The company faces a separate remedies trial for its advertising tech business, which is scheduled to begin Sept. 22.

Continue Reading

Trending