KVYO: Expanding CRM Platform Will Drive Gains Amid AI Disruption Fears

Analysts have trimmed their Klaviyo price target slightly, with fair value easing by about $0.16 to roughly $43.52 as they balance ongoing concerns around AI driven competitive pressure and lack of long term revenue guidance against expectations for continued revenue growth and operating leverage.

Analyst Commentary

Recent Street research reflects a balanced but increasingly polarized view on Klaviyo, with valuation seen as compelling by some and execution and competitive risk keeping others cautious.

Bullish Takeaways

Bullish analysts argue that the current valuation, at roughly mid single digit times next twelve months revenue and near historical lows, more than discounts AI related competitive risks and creates an attractive entry point.
Several expect Klaviyo to sustain revenue growth above 20 percent, outpacing current consensus expectations and supporting multiple expansion if the company continues to execute on product and go to market investments.
The expansion from core email marketing into a broader customer relationship management platform for consumer focused businesses is viewed as a key driver of long term market opportunity and operating leverage.
Some see recent share price weakness as driven more by sentiment and headline risk than by fundamentals, and describe themselves as incremental buyers on pullbacks as long as growth and margin trends remain intact.

Bearish Takeaways

Bearish analysts remain focused on AI driven disruption in front office marketing tools, noting that new offerings from large AI platforms could weigh on demand and compress Klaviyo's long term growth profile.
The omission of explicit long term or fiscal 2028 revenue targets at the recent investor events is interpreted as a signal of reduced visibility and has prompted downward revisions to price targets despite maintained positive ratings.
Some expect continued pressure across the broader marketing software group as investors recalibrate expectations for incumbents competing against AI native tools, which could cap near term valuation re rating for Klaviyo.
There is lingering concern that Klaviyo must prove it can deliver consistent operating leverage while investing aggressively in new products, with execution missteps likely to be punished given ongoing macro and competitive uncertainty.

What's in the News

Klaviyo unveiled its Marketing Agent and broadly released its Customer Agent, positioning the company as an AI first B2C CRM by unifying data, marketing, service, and analytics in a single platform and laying the groundwork for an autonomous CRM for the AI era (Key Developments).
The Marketing Agent autonomously plans and launches campaigns in minutes, generates on brand content, personalizes every send, and continuously learns from performance data, while providing a steady stream of new campaign ideas for marketers (Key Developments).
The Customer Agent delivers 24/7, brand trained assistance across chat, SMS, email, and soon WhatsApp, resolving common support issues, recommending products, and escalating with full context to human agents, all embedded directly inside Klaviyo's CRM (Key Developments).
Klaviyo raised its full year 2025 revenue guidance to a range of $1.215 billion to $1.219 billion, implying about 30 percent year over year growth (Key Developments).
The company also issued fourth quarter 2025 revenue guidance of $331 million to $335 million, implying 23 to 24 percent year over year growth (Key Developments).

Valuation Changes

The Fair Value Estimate has edged down slightly from $43.68 to $43.52 per share, reflecting a modest recalibration of assumptions.
The Discount Rate has risen slightly from 8.44 percent to about 8.47 percent, implying a marginally higher required return and risk premium.
The Revenue Growth Forecast is effectively unchanged, ticking down fractionally from about 21.12 percent to 21.12 percent on a forward basis.
The Net Profit Margin Outlook has increased very slightly from about 2.69 percent to 2.69 percent, signaling a minimal improvement in long term profitability expectations.
The Future P/E Multiple has eased marginally from roughly 373.1x to 372.0x, indicating a negligible shift in long term valuation assumptions.

International expansion, product innovation, and upmarket moves position Klaviyo for sustained topline growth, higher customer retention, and margin improvement.
Growing regulatory focus on first-party data and marketing stack consolidation strengthens Klaviyo's competitive edge and broadens its market opportunity.
Margin pressures, product uncertainty, customer volatility, fierce competition, and reliance on key partners all threaten Klaviyo's long-term growth and profitability outlook.

Catalysts

About Klaviyo

A technology company, provides a software-as-a-service platform in the United States, other Americas, the Asia-Pacific, Europe, the Middle East, and Africa.What are the underlying business or industry changes driving this perspective?

Growing international expansion, supported by new language rollouts, local channel integrations (e.g., WhatsApp), and localization efforts, is driving strong topline growth (e.g., 42% international revenue growth YoY), with further penetration of both SMB and enterprise segments likely to expand future revenue and earnings.
The regulatory and technical shift away from third-party cookies and toward first-party data benefits Klaviyo's unified, vertically integrated platform, positioning them to capture more wallet share from brands seeking compliant, data-driven personalization solutions-supporting future revenue and margin resiliency.
The rapid innovation and rollout of new AI-first products-including Conversational Agent, Helpdesk, and analytics-expands Klaviyo's addressable market from just marketing automation into broader B2C CRM and customer service, setting up significant opportunities for higher ARPU and long-term revenue growth.
Accelerating digital transformation among SMBs and the company's move upmarket into enterprise/mid-market customers (as demonstrated by record adds to the $50k+ ARR cohort) reduce revenue concentration risk and support more stable, recurring revenue and operating margin improvement as Klaviyo achieves greater scale.
The trend of marketing stack consolidation, with brands seeking integrated platforms to unify data and automate consumer engagement across marketing and service, favors Klaviyo's data-centric ecosystem, lowering customer churn and driving higher net margins through improved retention and cross-sell opportunities.

Klaviyo Future Earnings and Revenue Growth

Assumptions

How have these above catalysts been quantified?

Analysts are assuming Klaviyo's revenue will grow by 21.4% annually over the next 3 years.
Analysts assume that profit margins will increase from -6.2% today to 4.6% in 3 years time.
Analysts expect earnings to reach $88.3 million (and earnings per share of $0.27) by about September 2028, up from $-66.7 million today.
In order for the above numbers to justify the analysts price target, the company would need to trade at a PE ratio of 244.9x on those 2028 earnings, up from -140.5x today. This future PE is greater than the current PE for the US Software industry at 36.6x.
Analysts expect the number of shares outstanding to grow by 7.0% per year for the next 3 years.
To value all of this in today's terms, we will use a discount rate of 8.43%, as per the Simply Wall St company report.

Klaviyo Future Earnings Per Share Growth

Risks

What could happen that would invalidate this narrative?

Higher infrastructure and SMS channel costs are pressuring gross margins, and management indicated that future growth in SMS/RCS/WhatsApp will likely keep gross margins flat or potentially declining in the near term, which could weigh on long-term profitability and net margins.
The success of new service products (like the AI Helpdesk, Customer Hub, and Conversational Agent) is uncertain, as they are currently in beta and not expected to materially impact revenue or margins in the short-to-medium term, increasing the risk that anticipated product expansion does not deliver projected revenue or earnings growth.
Klaviyo's historic and ongoing strong reliance on SMB and entrepreneur customers exposes it to higher volatility and potential churn during macroeconomic downturns-creating topline risk and margin compression during periods of economic or e-commerce softness.
Intensifying competition from consolidated cloud suites (Salesforce, Adobe, HubSpot) and emerging AI-native marketing platforms could commoditize marketing automation and customer data solutions, pressuring Klaviyo's pricing power, customer retention, and long-term revenue/profit growth.
Dependence on partner ecosystems and integrations (with platforms like Shopify and WooCommerce) creates potential operational and competitive risks-if key partners introduce competing solutions or if Klaviyo's integration lags industry standards, customer loss and slower revenue expansion may result.

Valuation

How have all the factors above been brought together to estimate a fair value?

The analysts have a consensus price target of $46.2 for Klaviyo based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $60.0, and the most bearish reporting a price target of just $37.0.
In order for you to agree with the analyst's consensus, you'd need to believe that by 2028, revenues will be $1.9 billion, earnings will come to $88.3 million, and it would be trading on a PE ratio of 244.9x, assuming you use a discount rate of 8.4%.
Given the current share price of $31.23, the analyst price target of $46.2 is 32.4% higher.
We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.

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Disclaimer

AnalystConsensusTarget is a tool utilizing a Large Language Model (LLM) that ingests data on consensus price targets, forecasted revenue and earnings figures, as well as the transcripts of earnings calls to produce qualitative analysis. The narratives produced by AnalystConsensusTarget are general in nature and are based solely on analyst data and publicly-available material published by the respective companies. These scenarios are not indicative of the company's future performance and are exploratory in nature. Simply Wall St has no position in the company(s) mentioned. Simply Wall St may provide the securities issuer or related entities with website advertising services for a fee, on an arm's length basis. These relationships have no impact on the way we conduct our business, the content we host, or how our content is served to users. The price targets and estimates used are consensus data, and do not constitute a recommendation to buy or sell any stock, and they do not take account of your objectives, or your financial situation. Note that AnalystConsensusTarget's analysis may not factor in the latest price-sensitive company announcements or qualitative material.

KVYO: Expansion Into CRM Platforms Will Drive Broader Market Opportunity