Goldman Sachs: Application Software Stocks' Recovery Lacks Durability
Written by Emily J. Thompson, Senior Investment Analyst
Updated: May 19 2026
0mins
Source: Yahoo Finance
- Market Performance Analysis: Goldman Sachs reports that the median application software stock is down 38% year-to-date in 2026, with two short-lived recoveries of 14% from February 23 to March 6 and 22% from April 10 to mid-May, indicating a lack of sustained upward momentum in the market.
- AI-Driven Growth Expectations: The analyst notes that while there are signs of progress among software vendors, including leadership changes and product refinements, consistent AI-driven performance is not expected until 2027, with many companies warning that monetization timelines will extend 12 to 18 months, impacting short-term investment decisions.
- Investor Confidence Key: Goldman emphasizes that whether AI revenue adds to overall company growth rather than merely displacing existing software budgets is crucial for investor sentiment, as positive market reactions will only occur if AI revenues are seen as additive to overall growth.
- Identifying Unique Opportunities: The bank flags Microsoft and ServiceNow as idiosyncratic investment opportunities, but cautions that a new cohort of value-focused investors requires evidence of positive fundamental catalysts before adopting a constructive outlook, indicating a high expectation for fundamental improvements in the market.
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Analyst Views on KVYO
Wall Street analysts forecast KVYO stock price to rise
17 Analyst Rating
17 Buy
0 Hold
0 Sell
Strong Buy
Current: 14.740
Low
35.00
Averages
42.40
High
46.00
Current: 14.740
Low
35.00
Averages
42.40
High
46.00
About KVYO
Klaviyo, Inc. provides a customer relationship management (CRM) platform for business-to-consumer (B2C) brands. The Company, through its built-in data platform and artificial intelligence (AI) insights, combines marketing automation, analytics, and customer service into one unified solution, making it easy for businesses to know their customers. The Company's marketing automation solution allows customers to orchestrate campaigns across multiple marketing channels, including email, short message service and mobile push. Its platform solutions include Klaviyo B2C CRM, Klaviyo Marketing, Klaviyo Service, Klaviyo Analytics, Klaviyo Data Platform, and Klaviyo AI. The Klaviyo B2C CRM is a platform built for consumer brands. Its platform serves businesses of all sizes, across industries and geographies. Its platform solution also includes Gatsby, a social automation product that helps brands convert engagement over social channels into owned customer relationships.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Digital Brands Group Partners with Leading Outdoor Brand for AI Protection
- Strategic Collaboration: Digital Brands Group (NASDAQ:DBGI) has announced a new AI brand protection partnership with a globally recognized outdoor brand, marking a significant pivot from an apparel operator to an AI-enabled platform, which is expected to enhance brand protection capabilities and strengthen market competitiveness.
- Massive Market Potential: According to Adobe Analytics, AI-driven traffic to U.S. retail sites surged 693% year-over-year during the 2025 holiday shopping season, highlighting the immense potential of AI in retail, with global agentic commerce opportunities projected to reach $3 trillion to $5 trillion by 2030.
- Counterfeit Mitigation: OECD-EUIPO estimates the global trade in fake goods at approximately $467 billion, with 83% of online counterfeiting flowing through social and e-commerce channels; Digital Brands Group's collaboration aims to tackle this pressing challenge and protect brand assets effectively.
- Ecosystem Development: By partnering with SECUR3D, Digital Brands Group leverages its technology to identify unauthorized digital assets and counterfeit-related listings, further solidifying its position in the rapidly evolving digital commerce landscape and driving long-term value creation.
See More
Digital Brands Group Partners with Leading Outdoor Brand for AI Protection
- Strategic Collaboration: Digital Brands Group (NASDAQ:DBGI) has announced a new AI brand protection partnership with a globally recognized outdoor brand, marking a significant pivot from apparel operator to AI-enabled platform, which is expected to enhance brand protection capabilities and strengthen market competitiveness.
- Massive Market Potential: According to Adobe Analytics, AI-driven traffic to U.S. retail sites surged 693% year-over-year during the 2025 holiday shopping season, highlighting the immense potential of AI in retail, prompting Digital Brands Group to actively position itself to capitalize on this opportunity.
- Enhanced Technical Support: This collaboration will leverage SECUR3D's technology to assist in identifying unauthorized digital assets and counterfeit products, which is expected to significantly reduce the risks of brand abuse and intellectual property infringement, thereby protecting brand integrity and consumer trust.
- Ongoing Investment and Innovation: Digital Brands Group plans to continue exploring AI partnerships to drive technological innovation in brand protection and eCommerce, aiming to create long-term value for retail and consumer brands, further solidifying its position in the market.
See More
12 West Capital Management Exits Klaviyo Stake
- Stake Sale Details: On May 15, 2026, 12 West Capital Management disclosed to the SEC that it sold its entire stake in Klaviyo, totaling 1,838,000 shares, with an estimated transaction value of $39.42 million, indicating a significant loss of confidence in the company.
- Financial Impact Analysis: This exit resulted in a $59.68 million decrease in the quarter-end position value for 12 West Capital, highlighting substantial losses on its Klaviyo investment, with zero shares and dollar value reported as of March 31, 2026.
- Company Performance Overview: Despite Klaviyo's stock price plummeting approximately 55% over the past year, the latest quarter saw a 28% year-over-year revenue increase to $358 million, with management raising full-year revenue guidance to as high as $1.522 billion, indicating improving fundamentals.
- Market Outlook and Risks: Klaviyo's customer base has surpassed 196,000, with a 38% growth in customers generating over $50,000 in annual recurring revenue; although facing pressure from poor stock performance, if the company can sustain growth and expand margins, the current share price may be viewed as a temporary setback.
See More
12 West Capital Exits Entire Position in Klaviyo
- Complete Exit: 12 West Capital fully exited its position in Klaviyo, selling 1,838,000 shares for an estimated $39.42 million in Q1 2026, reflecting a pessimistic outlook on the market.
- Asset Value Decline: The exit resulted in a $59.68 million decrease in the fund's quarter-end position value, representing about 7% of its reportable U.S. equity assets under management, indicating significant portfolio shrinkage.
- Performance Growth: Despite Klaviyo's stock price plummeting over the past year, the latest quarter saw a 28% year-over-year revenue increase to $358 million, with a record non-GAAP operating margin of 16.4%, showcasing strong fundamentals.
- Future Outlook: Klaviyo's management raised full-year revenue guidance to $1.522 billion and authorized a $500 million share repurchase program, indicating confidence in future growth, even as market sentiment remains depressed.
See More
Klaviyo Board Member Sells 9,334 Shares
- Transaction Overview: Klaviyo Board member Susan St. Ledger sold 9,334 shares of Series A Common Stock for approximately $133,000, based on a weighted average price of $14.27 per share as reported in SEC Form 4, indicating a structured liquidity need.
- Ownership Change: Following the transaction, St. Ledger's direct Series A stake decreased by 46.04%, leaving her with 10,939 shares; while the sale exceeded her historical average, it reflects a declining available holdings base.
- Market Context: The sale occurred near Klaviyo's 52-week low of $13.53, impacted by sector-wide fears regarding AI and the departure of its CFO, contributing to a 55.88% decline in stock price over the past year.
- Performance Outlook: Despite market pressures, Klaviyo reported first-quarter revenue of $358 million, a 28% year-over-year increase, and raised its full-year 2026 sales guidance to $1.5 billion, showcasing strong performance and growth potential in the SaaS sector.
See More
Klaviyo Director Sells 9,334 Series A Shares
- Executive Sell-off: Klaviyo Director Susan St. Ledger sold 9,334 Series A shares on May 18, 2026, for approximately $133,000 at an average price of $14.27 per share, reducing her direct holdings to 10,939 shares, indicating a potential decrease in executive confidence in the stock.
- Transaction Transparency: The sale was executed under a Rule 10b5-1 trading plan established in June 2025, aimed at avoiding insider trading allegations, suggesting that St. Ledger still holds nearly 11,000 Series A shares and over 50,000 Series B shares, indicating she is not in a hurry to liquidate her holdings.
- Market Performance Impact: Prior to St. Ledger's transaction, Klaviyo's stock dropped to a 52-week low of $13.53 on May 13, influenced by a sector-wide sell-off in the SaaS industry, although the company reported first-quarter revenue of $358 million, a strong 28% year-over-year increase, and raised its full-year 2026 sales guidance to $1.5 billion, reflecting robust fundamentals.
- Investor Confidence Analysis: While St. Ledger's sell-off might raise concerns, analysts believe it does not warrant investor alarm, as Klaviyo's price-to-sales ratio of three is at a low point for the past year, suggesting it may be a good time to buy shares, despite being excluded from Motley Fool's list of top investment stocks.
See More
Digital Brands Group Partners with Leading Outdoor Brand for AI Protection
- Strategic Collaboration: Digital Brands Group (NASDAQ:DBGI) has announced a new AI brand protection partnership with a globally recognized outdoor brand, marking a significant pivot from an apparel operator to an AI-enabled platform, which is expected to enhance brand protection capabilities and strengthen market competitiveness.
- Massive Market Potential: According to Adobe Analytics, AI-driven traffic to U.S. retail sites surged 693% year-over-year during the 2025 holiday shopping season, highlighting the immense potential of AI in retail, with global agentic commerce opportunities projected to reach $3 trillion to $5 trillion by 2030.
- Counterfeit Mitigation: OECD-EUIPO estimates the global trade in fake goods at approximately $467 billion, with 83% of online counterfeiting flowing through social and e-commerce channels; Digital Brands Group's collaboration aims to tackle this pressing challenge and protect brand assets effectively.
- Ecosystem Development: By partnering with SECUR3D, Digital Brands Group leverages its technology to identify unauthorized digital assets and counterfeit-related listings, further solidifying its position in the rapidly evolving digital commerce landscape and driving long-term value creation.
See More
Digital Brands Group Partners with Leading Outdoor Brand for AI Protection
- Strategic Collaboration: Digital Brands Group (NASDAQ:DBGI) has announced a new AI brand protection partnership with a globally recognized outdoor brand, marking a significant pivot from apparel operator to AI-enabled platform, which is expected to enhance brand protection capabilities and strengthen market competitiveness.
- Massive Market Potential: According to Adobe Analytics, AI-driven traffic to U.S. retail sites surged 693% year-over-year during the 2025 holiday shopping season, highlighting the immense potential of AI in retail, prompting Digital Brands Group to actively position itself to capitalize on this opportunity.
- Enhanced Technical Support: This collaboration will leverage SECUR3D's technology to assist in identifying unauthorized digital assets and counterfeit products, which is expected to significantly reduce the risks of brand abuse and intellectual property infringement, thereby protecting brand integrity and consumer trust.
- Ongoing Investment and Innovation: Digital Brands Group plans to continue exploring AI partnerships to drive technological innovation in brand protection and eCommerce, aiming to create long-term value for retail and consumer brands, further solidifying its position in the market.
See More
12 West Capital Management Exits Klaviyo Stake
- Stake Sale Details: On May 15, 2026, 12 West Capital Management disclosed to the SEC that it sold its entire stake in Klaviyo, totaling 1,838,000 shares, with an estimated transaction value of $39.42 million, indicating a significant loss of confidence in the company.
- Financial Impact Analysis: This exit resulted in a $59.68 million decrease in the quarter-end position value for 12 West Capital, highlighting substantial losses on its Klaviyo investment, with zero shares and dollar value reported as of March 31, 2026.
- Company Performance Overview: Despite Klaviyo's stock price plummeting approximately 55% over the past year, the latest quarter saw a 28% year-over-year revenue increase to $358 million, with management raising full-year revenue guidance to as high as $1.522 billion, indicating improving fundamentals.
- Market Outlook and Risks: Klaviyo's customer base has surpassed 196,000, with a 38% growth in customers generating over $50,000 in annual recurring revenue; although facing pressure from poor stock performance, if the company can sustain growth and expand margins, the current share price may be viewed as a temporary setback.
See More
12 West Capital Exits Entire Position in Klaviyo
- Complete Exit: 12 West Capital fully exited its position in Klaviyo, selling 1,838,000 shares for an estimated $39.42 million in Q1 2026, reflecting a pessimistic outlook on the market.
- Asset Value Decline: The exit resulted in a $59.68 million decrease in the fund's quarter-end position value, representing about 7% of its reportable U.S. equity assets under management, indicating significant portfolio shrinkage.
- Performance Growth: Despite Klaviyo's stock price plummeting over the past year, the latest quarter saw a 28% year-over-year revenue increase to $358 million, with a record non-GAAP operating margin of 16.4%, showcasing strong fundamentals.
- Future Outlook: Klaviyo's management raised full-year revenue guidance to $1.522 billion and authorized a $500 million share repurchase program, indicating confidence in future growth, even as market sentiment remains depressed.
See More
Klaviyo Board Member Sells 9,334 Shares
- Transaction Overview: Klaviyo Board member Susan St. Ledger sold 9,334 shares of Series A Common Stock for approximately $133,000, based on a weighted average price of $14.27 per share as reported in SEC Form 4, indicating a structured liquidity need.
- Ownership Change: Following the transaction, St. Ledger's direct Series A stake decreased by 46.04%, leaving her with 10,939 shares; while the sale exceeded her historical average, it reflects a declining available holdings base.
- Market Context: The sale occurred near Klaviyo's 52-week low of $13.53, impacted by sector-wide fears regarding AI and the departure of its CFO, contributing to a 55.88% decline in stock price over the past year.
- Performance Outlook: Despite market pressures, Klaviyo reported first-quarter revenue of $358 million, a 28% year-over-year increase, and raised its full-year 2026 sales guidance to $1.5 billion, showcasing strong performance and growth potential in the SaaS sector.
See More
Klaviyo Director Sells 9,334 Series A Shares
- Executive Sell-off: Klaviyo Director Susan St. Ledger sold 9,334 Series A shares on May 18, 2026, for approximately $133,000 at an average price of $14.27 per share, reducing her direct holdings to 10,939 shares, indicating a potential decrease in executive confidence in the stock.
- Transaction Transparency: The sale was executed under a Rule 10b5-1 trading plan established in June 2025, aimed at avoiding insider trading allegations, suggesting that St. Ledger still holds nearly 11,000 Series A shares and over 50,000 Series B shares, indicating she is not in a hurry to liquidate her holdings.
- Market Performance Impact: Prior to St. Ledger's transaction, Klaviyo's stock dropped to a 52-week low of $13.53 on May 13, influenced by a sector-wide sell-off in the SaaS industry, although the company reported first-quarter revenue of $358 million, a strong 28% year-over-year increase, and raised its full-year 2026 sales guidance to $1.5 billion, reflecting robust fundamentals.
- Investor Confidence Analysis: While St. Ledger's sell-off might raise concerns, analysts believe it does not warrant investor alarm, as Klaviyo's price-to-sales ratio of three is at a low point for the past year, suggesting it may be a good time to buy shares, despite being excluded from Motley Fool's list of top investment stocks.
See More
