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Artificial Intelligence is stealing jobs…
And allowing companies to dramatically increase their profits.
The latest example is Klarna (private).
The fintech is one of the biggest “Buy Now, Pay Later” companies. It competes with Affirm (NASDAQ: AFRM).
Klarna serves 150 million customers.
The company wants to go public in an Initial Public Offering this year valuing the company at $20 billion.
Right now, investors aren’t interested in money-losing stocks.
That’s forcing Klarna to be profitable.
So, the company started slashing costs.
They partnered with OpenAI (private) to use ChatGPT for customer service.
The AI chatbot is now handling nearly 70% of customer requests.
Klarna says that AI is now doing the work of 700 customer service agents.
Customer requests are answered in just 2-minutes using AI. That compares with 11-minutes with a real support person.
The AI chatbot is expected to increase profits by $40 million this year.
OpenAI COO Brad Lightcap comments on the partnership…
“Klarna is at the very forefront among our partners in AI adoption and practical application. Together we are unlocking the vast potential for AI to boost productivity and improve our day-to-day lives.
It’s no coincidence that the company cut its headcount by 25% last year.
Klarna says the layoffs were unrelated to Artificial Intelligence.
It’s hard to imagine that’s true…
The Klarna press release says that AI is doing the work of 700 people. And the company fires +1,000 employees at the same time.
IMO there seems to be a connection.
Additionally, Klarna’s CEO implemented a hiring freeze. And he thinks AI can replace many human tasks.
It’s still unpopular for a CEO to say…
“We’re firing the workers. And replacing them with Artificial Intelligence.”
Yet leading tech stocks like Tesla (NASDAQ: TSLA) are investing billions in breakthrough AI.
Ian