Every single trading day ends the same way for a certain corner of the investing world: phones start ringing off the hook the moment Jim Cramer fires up the Lightning Round on Mad Money. And on December 1st, one answer stopped a lot of us in our tracks.
When a caller asked about Klarna, the Swedish buy-now-pay-later giant that everyone was buzzing about after its red-hot IPO, Cramer’s response was brutally direct. No hedging, no “it’s complicated,” just four words that cut through the noise: “Sell it and buy Affirm.”
Why One Word From Cramer Still Moves Markets
Let’s be honest—plenty of people love to hate on Jim Cramer. They call him entertainment, not analysis. But love him or not, when that lightning round bell rings, traders listen. And the fact that Affirm jumped more than 4% in after-hours trading the moment those words aired? That’s not coincidence.
I’ve been watching these segments for years, and there’s something different about the calls that actually stick. The best ones aren’t complicated theses—they’re gut-level convictions delivered at machine-gun speed. And this Klarna-versus-Affirm call felt exactly like that.
The Core of Cramer’s Bull Case on Affirm
So what makes Affirm the chosen one in Cramer’s eyes?
First, there’s the partnership moat. Affirm isn’t just another payment app fighting for attention—it’s deeply embedded with giants like Amazon, Walmart, and Shopify. When you check out on half the internet and see that little “Pay over time with Affirm” button, that’s not an accident. Those are exclusive, long-term contracts that Klarna simply doesn’t have at the same scale in the U.S. market.
Second, and this part gets overlooked constantly, Affirm actually makes money the old-fashioned way. They underwrite every single loan themselves. That sounds boring until you realize Klarna largely operates as a middleman connecting banks with consumers—taking a cut but carrying almost none of the credit risk. When defaults eventually rise (and they always do in consumer lending), guess which model holds up better?
Affirm’s willingness to keep credit risk on its own balance sheet is either brave or crazy—depending on who you ask. But history shows that owning your risk forces better underwriting decisions.
Klarna’s Flashy Numbers Hide Real Problems
Look, nobody’s saying Klarna is going bankrupt tomorrow. The company has grown like wildfire in Europe and the brand is legitimately cool. But cool doesn’t pay the bills when interest rates stay “higher for longer.”
Their business model depends heavily on forwarding credit risk to partner banks. Those same banks are now tightening standards faster than I’ve seen in years. Translation: Klarna’s growth engine just hit a speed bump that might last longer than the market expects.
- Gross merchandise volume growth is slowing (already visible in recent quarters)
- Take rates are under pressure as banks demand better terms
- U.S. expansion remains expensive and partnership-light compared to Affirm
- Still burning cash despite profitability claims in certain quarters
Put simply, Klarna feels like the classic “growth at any cost” story that worked beautifully in a zero-interest-rate world. We’re not in that world anymore.
The Math That Actually Matters Right Now
Let’s talk numbers, because this is where things get interesting.
Affirm trades at roughly 8 times next year’s projected revenue. Klarna? Closer to 12 times, despite growing slower and with worse unit economics. That gap has widened dramatically since both companies became public, and Cramer clearly thinks it’s about to widen further.
More importantly, Affirm’s delinquency trends have actually improved sequentially even as the consumer feels pinched. That’s the mark of disciplined underwriting. When I saw their latest 30+ day delinquency rate tick down while overall volume exploded, I had the same reaction Cramer apparently did—this management team knows what they’re doing.
| Metric | Affirm | Klarna |
| Key U.S. Partnerships | Amazon, Walmart, Shopify | Limited major exclusives |
| Credit Risk Ownership | 100% on balance sheet | Mostly passed to banks |
| Revenue Multiple | ~8x forward | ~12x forward |
| Recent Delinquency Trend | Improving | Stable to rising |
What This Says About the Broader Fintech Trade
Cramer’s call isn’t happening in a vacuum. The entire “buy now, pay later” sector got crushed in 2022 and 2023 when rates spiked, then staged a furious comeback this year on hopes of Fed cuts. Now the Fed is cutting, but slowly, and the consumer is showing real cracks—credit card delinquencies at banks just hit levels not seen since 2011.
In that environment, you want the company that controls its own destiny. You want the one with sticky, exclusive partnerships and the balance sheet to weather a storm. That’s Affirm, full stop.
Perhaps the most telling part? Cramer also gave a quick thumbs-up to Newmont in the same lightning round, saying it’s “real, real good.” Gold doing well while he picks the more conservative fintech player? That’s someone positioning for a world where consumers are tapped out and safety matters more than hype.
The Bottom Line for Investors Right Now
I’m not saying run out and buy Affirm tomorrow morning without doing your homework. But when one of the most watched voices in retail investing draws a line in the sand this clearly, you pay attention.
The buy-now-pay-later space was always going to consolidate into a few winners. Cramer just told us who he thinks wins the U.S. battle. And honestly? The evidence is starting to line up behind him.
Sometimes the simplest advice is the best. In this case, four words might have just handed patient investors the trade of 2026.
Sell the story. Buy the business.
