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01/10 16:57
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call highlights strong financial performance with a 33% revenue growth, significant customer growth, and international expansion. Positive sentiment is reinforced by optimistic revenue guidance, new customer wins, and product innovation. The Q&A section reveals strong market positioning and strategic focus on AI and international growth. Despite some management vagueness, the overall outlook is positive, with potential short-term boosts from new product introductions and partnerships. The absence of a market cap limits precise impact prediction, but the sentiment leans towards a 2% to 8% stock price increase.
Revenue $293 million, up 32% year-over-year. The increase was driven by new customer additions, expansion with existing customers, international growth, and moving upmarket.
Non-GAAP Operating Margin 14%, demonstrating efficient growth at scale. This was better than guidance due to revenue upside and operating expense leverage.
Free Cash Flow $59 million, attributed to higher collections and timing of payments.
Customer Count 176,000 customers, up 17% year-over-year and 7,000 from Q1. Growth was driven by entrepreneurial customers, SMB, mid-market, and enterprise segments.
Net Revenue Retention (NRR) 108%, consistent with the last two quarters. This was driven by gross revenue retention, email expansion, and newer product offerings.
Customers with over $50,000 in ARR 3,291 customers, up 38% year-over-year. Growth was driven by new customer additions and existing customer expansion.
International Revenue Growth 42% year-over-year, with EMEA revenue up 47% and APAC revenue growth accelerating. This was driven by international expansion efforts.
Non-GAAP Gross Margin 76%, down approximately 2 points year-over-year due to increased infrastructure costs and SMS product growth. However, it was flat compared to Q1 due to infrastructure optimizations.
Omnichannel Campaign Builder: A new canvas to plan, launch, and measure complex multi-data campaigns across channels, with built-in insights and AI-optimized delivery.
Channel Affinity powered by Klaviyo AI: Leverages predictive attributes to discern each customer's preferred communication channels and optimal engagement time.
Multi-touch Attribution: Provides real-time visibility into revenue drivers beyond last click.
Helpdesk and Conversational Agent (Private Beta): AI-first Helpdesk integrates customer support with marketing, while the Conversational Agent offers tailored product recommendations and facilitates product discovery.
Customer Hub: Unifies consumer experiences across marketing and service, generating millions in additional incremental attributable revenue for customers.
Marketing Analytics: Gaining strong momentum with nearly 2,000 customers, ensuring precise targeting and timing for maximum ROI.
International Expansion: Revenue grew 42% year-on-year internationally, with EMEA revenue up 47% and APAC revenue growth accelerating. Added brands like Nothing, a U.K.-based challenger in the smartphone and audio category.
Partnerships and Integrations: New integrations with Guesty and vivenu expand reach into hospitality and entertainment sectors.
Revenue Growth: Achieved $293 million in revenue, up 32% year-on-year.
Customer Growth: Added 7,000 customers in Q2, reaching over 176,000 customers, up 17% year-on-year.
Enterprise Customer Growth: Record quarter with 3,291 customers having over $50,000 in ARR, up 38% year-on-year.
AI-First Approach: Solidifying leadership with AI-powered solutions across marketing, service, and analytics, including MCP server for integrating Klaviyo data into LLMs.
Leadership Changes: Welcomed Archana Rao as CIO and announced the retirement of President Steve Rowland, who contributed significantly to growth and international expansion.
Regulatory and Compliance Risks: The company acknowledges forward-looking statements are subject to risks, uncertainties, and assumptions, which could materially affect results. This implies potential regulatory or compliance challenges.
Macroeconomic Environment: The company incorporated prudence in guidance due to an uncertain macroeconomic environment, indicating potential risks from economic fluctuations.
Infrastructure Costs: Non-GAAP gross margin decreased due to increased infrastructure costs, which could impact profitability if not managed effectively.
SMS Product Growth: The growing SMS product mix is contributing to higher costs, which may pressure margins.
International Expansion: While international revenue grew significantly, expansion into new markets may pose operational and competitive risks.
Customer Retention and Growth: The company relies on customer retention and expansion for growth. Any decline in net revenue retention (NRR) or customer acquisition could impact financial performance.
Competitive Pressures: The company faces competition from legacy marketing clouds and other CRM providers, which could affect market share and pricing power.
Leadership Changes: The retirement of the President and onboarding of a new CIO could lead to transitional challenges in leadership and strategy execution.
Revenue Guidance for Q3 2025: Expected revenue of $297 million to $301 million, representing year-over-year growth of 26% to 28%.
Full Year 2025 Revenue Guidance: Raised to $1.203 billion at the midpoint, representing year-over-year growth of 27% to 28%.
Non-GAAP Operating Income Guidance for Q3 2025: Expected to be $32.5 million to $35.5 million, representing a non-GAAP operating margin of 11% to 12%.
Full Year 2025 Non-GAAP Operating Income Guidance: Expected to be $144 million to $150 million, representing a non-GAAP operating margin of 12%.
International Expansion: EMEA revenue grew 47% year-over-year, and APAC revenue growth accelerated for the second quarter in a row. Investments in international markets are yielding strong results.
Product and Innovation Outlook: Continued focus on AI-driven solutions, including enhancements to marketing, service, and analytics products. New features like Omnichannel Campaign Builder, channel affinity, and multi-touch attribution are expected to drive customer engagement and ROI.
Enterprise and Mid-Market Growth: Plans to add enterprise experience to the team, increase strategic partner collaboration, and enhance platform scalability to serve large consumer brands.
Customer Growth: Focus on expanding customer base, with 3,291 customers having over $50,000 in ARR, up 38% year-over-year.
The selected topic was not discussed during the call.
The earnings call summary indicates strong financial performance, with raised revenue guidance and significant international growth. Product development is focused on AI-driven solutions, enhancing customer engagement. The Q&A session highlighted confidence in future growth, with strategic partnerships and successful product lines. Despite some uncertainty in management's responses, the overall sentiment is positive, supported by optimistic guidance and strategic initiatives.
The earnings call highlights strong financial performance with a 33% revenue growth, significant customer growth, and international expansion. Positive sentiment is reinforced by optimistic revenue guidance, new customer wins, and product innovation. The Q&A section reveals strong market positioning and strategic focus on AI and international growth. Despite some management vagueness, the overall outlook is positive, with potential short-term boosts from new product introductions and partnerships. The absence of a market cap limits precise impact prediction, but the sentiment leans towards a 2% to 8% stock price increase.
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