Scotiabank has adjusted its price target for Klaviyo (KVYO, Financial) from $45 to $31, while maintaining a Sector Perform rating on the company's shares. This revision is part of a broader update on price targets across the U.S. software sector, prompted by a recent downturn in the industry.
The firm has highlighted that potential tariff impacts could play a significant role, although these are anticipated to become more evident in the second quarter and the second half of the year.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 22 analysts, the average target price for Klaviyo Inc (KVYO, Financial) is $45.90 with a high estimate of $60.00 and a low estimate of $31.00. The average target implies an upside of 66.27% from the current price of $27.61. More detailed estimate data can be found on the Klaviyo Inc (KVYO) Forecast page.
Based on the consensus recommendation from 23 brokerage firms, Klaviyo Inc's (KVYO, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
KVYO Key Business Developments
Release Date: February 19, 2025
- Q4 Revenue: $270 million, up 34% year-over-year.
- Full-Year Revenue: $937 million, up 34% year-over-year.
- Q4 Free Cash Flow: $54 million, up 57% year-over-year.
- Full-Year Free Cash Flow: $149 million, up 35% from the prior year.
- Q4 Non-GAAP Operating Margin: 6%.
- Full-Year Non-GAAP Operating Margin: 12%.
- Customer Growth: Over 10,000 new customers added in Q4, totaling more than 167,000 customers, up 17% year-over-year.
- Q4 Dollar-Based Net Revenue Retention Rate (NRR): 108%.
- Q4 Non-GAAP Gross Margin: 74%.
- Q1 2025 Revenue Guidance: $265 million to $269 million, representing 26% to 28% year-over-year growth.
- Full-Year 2025 Revenue Guidance: $1.156 billion to $1.164 billion, representing 23% to 24% year-over-year growth.
- Full-Year 2025 Non-GAAP Operating Margin Guidance: 11% to 12%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Klaviyo Inc (KVYO, Financial) reported a strong Q4 with $270 million in revenue, marking a 34% year-over-year increase.
- The company achieved a $1 billion revenue run rate and generated nearly $150 million in free cash flow for the full year.
- Klaviyo Inc (KVYO) expanded its platform capabilities with over 200 new features, enhancing customer success and market differentiation.
- The company made significant progress in international expansion, with SMS coverage in 19 countries and platform availability in six additional languages.
- Partnerships and integrations with companies like WooCommerce, Canva, and Pinterest are driving ecosystem-led growth and expanding market reach.
Negative Points
- Non-GAAP gross margins decreased by approximately 5 points year-over-year in Q4 due to increased infrastructure costs and SMS product growth.
- The company anticipates some incremental churn due to new pricing updates, which may impact customer counts in Q1.
- Klaviyo Inc (KVYO) expects Q1 free cash flow to be negative due to employee bonus payments and seasonal payroll-related expenses.
- The company is cautiously optimistic about external small business sentiment and is not assuming meaningful improvement in guidance until sustained changes are observed.
- Despite strong growth, the company faces challenges in maintaining high non-GAAP operating margins due to continued investments in growth drivers.
