The Resurgence of U.S. IPOs: Analyzing the High-Profile Listings of Klarna and Gemini

The U.S. IPO market is heating up in 2025, driven by a confluence of favorable macroeconomic conditions, regulatory clarity, and investor appetite for high-growth fintech and crypto firms. Two of the most anticipated listings—Swedish buy-now-pay-later (BNPL) giant Klarna and crypto exchange Gemini—highlight the sector’s resurgence. However, their post-IPO trajectories will hinge on navigating significant risks while capitalizing on structural opportunities in a warming market.

Klarna: A BNPL Giant’s Reentry Amid a Cautious Market

Klarna’s long-awaited IPO, set for September 10, 2025, aims to raise $1.27 billion by offering 34.3 million shares at $35–$37, valuing the company at $14 billion [1]. This represents a sharp recovery from its 2022 valuation of $6.7 billion but remains 69% below its 2021 peak of $45.6 billion [2]. The company’s decision to proceed with its IPO follows a pause in April 2025 due to market volatility linked to U.S. trade tariffs, underscoring the sensitivity of high-growth tech firms to macroeconomic shifts [3].

Klarna’s financials tell a mixed story. While it reported $1.52 billion in revenue for H1 2025, it also posted a net loss of $153 million during the same period [4]. The company’s strategy to diversify beyond BNPL—launching a mobile plan and debit card—signals a pivot toward digital banking, a move that could unlock new revenue streams but also intensify competition with established players like Affirm and PayPal [5].

Risks:
- Profitability Concerns: Klarna’s adjusted operating profit of $29 million in Q2 2025 contrasts with a $53 million net loss for the same period, highlighting operational inefficiencies [6].
- Valuation Volatility: At $14 billion, Klarna’s valuation is ambitious given its recent losses and the BNPL sector’s regulatory scrutiny in the U.S. [7].

Opportunities:
- Market Expansion: Klarna’s U.S. expansion, though costly, positions it to capture a growing market for interest-free installment purchases [8].
- Strategic Diversification: Its foray into digital banking could reduce reliance on BNPL and attract a broader customer base [9].

Gemini: Crypto’s Next Public Test Case

Gemini, the Winklevoss twins’ crypto exchange, is set to list on Nasdaq under the ticker GEMI, targeting a $2.22 billion valuation by raising $317 million through 16.67 million shares priced at $17–$19 [10]. This would make it the third publicly traded crypto exchange in the U.S., following Coinbase and Bullish. However, Gemini’s financials are a cause for concern: it reported a net loss of $282.5 million in H1 2025, a 580% increase from $41.4 million in the prior year [11].

Gemini’s IPO comes amid a crypto bull run and regulatory clarity under the Trump administration, which has signaled support for innovation in digital assets [12]. The company’s product suite—self-custodial wallets, gas-free DeFi transactions, and institutional-grade services—positions it to benefit from growing institutional adoption. Yet, its financial health remains a red flag.

Risks:
- Sustainability of Losses: With revenue declining 8% year-over-year to $68.6 million in H1 2025, Gemini’s ability to achieve profitability is uncertain [13].
- Regulatory Uncertainty: While the Trump administration has eased crypto regulations, the sector remains vulnerable to sudden policy shifts or enforcement actions [14].

Opportunities:
- Institutional Momentum: Gemini’s expansion into institutional markets and partnerships with Trump allies could attract capital from a sector traditionally wary of crypto [15].
- Market Timing: The IPO coincides with a broader crypto rally, with Bitcoin and Ethereum surging, which may buoy investor sentiment [16].

Broader Market Implications

The Klarna and Gemini IPOs are part of a larger trend: fintech and crypto firms are re-entering public markets after years of caution. This revival is fueled by a dovish Federal Reserve, which has reduced discounting pressures on high-growth stocks, and a surge in investor appetite for innovation-driven sectors [17]. For example, Circle’s IPO in 2025 saw a 11% pre-market gain, signaling optimism for crypto-related listings [18].

However, the success of these IPOs will depend on broader economic signals. Klarna’s oversubscribed offering suggests strong retail and institutional interest in BNPL, but its stock will face pressure if interest rates rise or regulatory scrutiny intensifies. Similarly, Gemini’s performance will be closely tied to crypto market volatility and the sector’s ability to prove its utility beyond speculative trading.

Conclusion

Klarna and Gemini represent two sides of the same coin: high-growth potential paired with significant risks. For Klarna, the key will be demonstrating a path to profitability while expanding its digital banking footprint. For Gemini, the challenge is to turn around its financials and convince investors that crypto is more than a speculative asset. Both companies are testing the resilience of the IPO market in a warming economy, and their post-listing performance will offer critical insights for investors navigating the next phase of fintech and crypto innovation.

Source:
[1] Klarna to raise as much as $1.27B in revived IPO [https://www.bankingdive.com/news/klarna-revives-ipo-new-york-stock-exchange-bnpl/759087/]
[2] Klarna's IPO Revival Hits Now? With a $1.27 billion raise [https://medium.com/@finomicsedge/klarnas-ipo-revival-hits-now-12d6bb6aa68d]
[3] Klarna Stock Price Prediction: How High Will It Go Post IPO? [https://www.btcc.com/en-CA/academy/financial-investment/klarna-stock-price-prediction-how-high-will-it-go-post-ipo]
[4] Klarna IPO reportedly well oversubscribed [https://www.investing.com/news/stock-market-news/klarna-ipo-reportedly-well-oversubscribed-432SI-4224767]
[5] Klarna Secures $26 Billion for US BNPL Expansion [https://www.pitchbook.com/news/articles/klarna-seeks-to-raise-1-27b-in-long-awaited-us-ipo]
[6] Klarna IPO Plans Revived, Company Targets $14 Billion [https://stocktwits.com/news-articles/markets/equity/klarna-ipo-1-27-billion-at-14-billion-valuation-after-trump-tariff-delay/chv6D6TRdF7]
[7] The IPO Market Is Heating Up. Here's What Investors ... [https://www.morningstar.com/markets/ipo-market-is-heating-up-heres-what-investors-should-be-watching]
[8] 2025 Hottest US IPO Week: Klarna, Gemini, Figure Set for “Triple Launch” [https://www.newsbreak.com/tradingkey-331884976/4211654752442-2025-hottest-us-ipo-week-klarna-gemini-figure-set-for-triple-launch]
[9] Klarna Group (KLAR) Stock Price & Overview [https://stockanalysis.com/stocks/klar/]
[10] Gemini, Led by Winklevoss Twins, Files to Go Public on Nasdaq [https://www.alphaspread.com/market-news/ipo/gemini-led-by-winklevoss-twins-files-to-go-public-on-nasdaq]
[11] Crypto Exchange Gemini's Losses Explode 580% Before Going Public [https://www.financemagnates.com/cryptocurrency/exchange/crypto-exchange-geminis-losses-explode-580-before-going-public/]
[12] Gemini Targets $2.1 Billion Valuation in IPO [https://www.pymnts.com/news/ipo/2025/gemini-targets-2-billion-dollar-valuation-ipo/]
[13] Inside Gemini Space Station's IPO: What Investors Need to ... [https://www.tradingcalendar.com/post/gemini-gemi-ipo]
[14] Gemini and Figure IPO could they end up like Circle? [https://www.reddit.com/r/investing/comments/1n7yzgr/gemini_and_figure_ipo_could_they_end_up_like/]
[15] Winklevoss Backed Gemini Seeks $2.22 Billion Valuation ... [https://coincentral.com/winklevoss-backed-gemini-seeks-2-22-billion-valuation-as-ipo-plans-heat-up/]
[16] Traders Market Weekly: Dovish Fed Framework, [https://traderscommunity.com/traders-market-weekly-dovish-fed-framework/]
[17] The IPO Market Is Heating Up. Here's What Investors ... [https://www.morningstar.com/markets/ipo-market-is-heating-up-heres-what-investors-should-be-watching]
[18] 2025 Hottest US IPO Week: Klarna, Gemini, Figure Set for “Triple Launch” [https://www.newsbreak.com/tradingkey-331884976/4211654752442-2025-hottest-us-ipo-week-klarna-gemini-figure-set-for-triple-launch]