36 slides from Klaviyo, Inc. Series A's earnings presentation, Nov 6, 2024
Slide 1: Klaviyo Financial Results Q3 2024
Klaviyo Financial Results Q3 2024
Slide 2: Forward-Looking Statements and Disclaimer
Forward-Looking Statements and Disclaimer This presentation includes certain “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. Other than statements of historical facts, all statements contained in this
Slide 3: Statement Regarding Use of Non-GAAP Financial Measures
Statement Regarding Use of Non-GAAP Financial Measures In addition to financial measures prepared in accordance with generally accepted accounting principles in the United States (GAAP), this presentation and accompanying oral commentary contain non-GAAP financial measures, including non-GAAP gross pr
Slide 4: Klaviyo powers smarter digital relationships
Klaviyo powers smarter digital relationships Activate Connect Guide Grow data in real-time to with customers marketing with audience, better target, through a built-in AI, customer lifetime personalize, and seamless email, automations, value, and total measure all SMS, mobile push, predictive revenu
Slide 5: Klaviyo at a glance
Klaviyo at a glance1 $869M Revenue 110% Dollar-Based Net Revenue 32% EMEA and APAC 15% Free Cash Flow Margin3 Retention Rate2,4 Revenue 35% 157,000+ 2,619 2,4 13% Revenue Growth Total Customers Customers Generating Over Non-GAAP $50K ARR2,4 Operating Margin3 54% YoY Growth 1 All metrics for trailing
Slide 6: Large and growing customer base
Large and growing customer base1 157,000+ Total Customers 2,619 Customers > $50K ARR 1 All metrics as of September 30, 2024. See Appendix for definitions of Customers and Customers Generating Over $50,000 of ARR. 2024 © Klaviyo 6
Slide 7: Businesses need to deliver highly personalized experiences to drive revenue growth
Businesses need to deliver highly personalized experiences to drive revenue growth 01 Initial connection 02 Revenue-driving engagement 03 Real-time engagement 04 Ongoing engagement Collect first-party data to Connect with consumers—not Predictive analytics advise Predictive analytics create connect w
Slide 8: Delivering impactful consumer experiences is challenging
Delivering impactful consumer experiences is challenging X Wrong product X Lack of context X Fractured experience X Counterproductive Messages are impersonal and Without real-time event data, Disjointed consumer experience Lack of context results in disconnected from consumer inappropriate messages
Slide 9: Other solutions do not have the full stack to unlock all the capabilities
Other solutions do not have the full stack to unlock all the capabilities required by creators Cloud data warehouses and Single channel solutions Marketing solution providers operational databases 2024 © Klaviyo 9
Slide 10: Our vertically-integrated platform unifies data and application layers
Our vertically-integrated platform unifies data and application layers 1 As of September 30, 2024 2024 © Klaviyo 10
Slide 11: Key benefits of our vertically-integrated platform
Key benefits of our vertically-integrated platform Ease of use + Advanced capabilities Rapid Easy-to-use Coordinated Real-time Extremely AI / ML-enabled implementation regardless of engagement action to reach granular predictive with clear technical skill across consumers segmentation insights drive
Slide 12: Ease of use allows businesses to put all their data to work
Ease of use allows businesses to put all their data to work Rapid implementation with Easy-to-use regardless Coordinated engagement clear attributable value to of technical skill level across channels drive high ROI Email SMS Push KAV = revenue generated for our customers One-click customizable temp
Slide 13: Advanced capabilities deliver highly personalized experiences
Advanced capabilities deliver highly personalized experiences Real-time action to reach Extremely granular AI / ML-enabled predictive consumers data segmentation insights drive revenue growth Behavior forecasting Benchmarking A/B testing Generative content Sub-second-level accessibility to query dat
Slide 14: AI is central to our roadmap and we have a significant advantage
AI is central to our roadmap and we have a significant advantage AI strategy is built on foundational values of data privacy and trust ▪ AI is a meaningful component of our platform today and we will continue to drive innovation Generative and predictive AI ▪ We have a differentiated advantage Idea ge
Slide 15: CDP: Product Analysis
CDP: Product Analysis Promote the right products at the right time to drive repeat purchases at scale Boost revenue with smarter merchandising Tailor your omnichannel strategy by understanding what’s selling and why Effortlessly increase average order value Build high-converting bundles using insight
Slide 16: Product-led growth drives highly efficient go-to-market engine
Product-led growth drives highly efficient go-to-market engine Efficient inbound motion Organic, Inbound Targeted Word of mouth Agency Partners Self-serve, outbound motion Platform Partners low-touch sales Focused on larger customers 157,000+ Total Customers1 Deliver actionable Frictionless Land with in
Slide 17: Our partner ecosystem enriches customer offerings and expands reach
Our partner ecosystem enriches customer offerings and expands reach Commerce • Drive revenue for Klaviyo and GMV • Building applications that extend for commerce platforms platforms functionality for Klaviyo Developers • Partner on product and GTM • Inside customers or third party developers Other te
Slide 18: Whitespace for durable growth with sustained execution
Whitespace for durable growth with sustained execution ● $869M in TTM Revenue1 Global TAM $68B ● $16B market in retail and eCommerce (~5% penetrated) ● $34B market across verticals in the U.S. (~3% penetrated) U.S. TAM $34B ● $68B market globally (~1% penetrated) SAM $16B $869M in TTM Revenue1 1 For
Slide 19: Our growth drivers
Our growth drivers Developer-led apps New use cases Expand into new verticals Further invest Broad platform Grow our in our platform applicability Customer service mid-market and enterprise Expand Integrations with Open architecture presence In-product or app Internationally Reviews Mindbody, Toast,
Slide 20: Financials
Financials 2024 © Klaviyo 20
Slide 21: Financial highlights from FY24 Q3
Financial highlights from FY24 Q31 Operating at Scale $235M Quarterly revenue Strong Revenue Growth 34% Year-over-year growth rate Healthy Expansion With Our Customers 110% Dollar-Based Net Revenue Retention Rate2 Momentum in the Mid Market 54% Year-over-year growth in Customers > $50K ARR3 Generati
Slide 22: Revenue growth at scale
Revenue growth at scale YoY Growth 54% 35% 48% 39% 35% 35% 34% 2024 © Klaviyo 22
Slide 23: Strong customer growth
Strong customer growth 1 1 +16% +54% 1 2024 © Klaviyo 23 See Appendix for definitions of Customers and Customers Generating Over $50,000 of ARR. All figures are as of the end of the applicable period.
Slide 24: Continuing to diversify internationally
Continuing to diversify internationally Percentages may not sum to 100% due to rounding. 2024 © Klaviyo 24
Slide 25: Measured investments against our market opportunity
Measured investments against our market opportunity Key drivers ▪ G&A leverage due to the release of an international tax related reserve and the lapping of Q3 FY23 one-time IPO costs ▪ R&D gaining leverage while investing in long-term growth ▪ S&M investing behind strong unit economics and marketin
Slide 26: Continued YoY growth of non-GAAP operating margin
Continued YoY growth of non-GAAP operating margin Non-GAAP 10% 14% Operating Margin See Appendix for Non-GAAP reconciliation. 2024 © Klaviyo 26
Slide 27: Consistent free cash flow generation
Consistent free cash flow generation TTM Free Cash Flow Margin 15% 16% 16% 14% 15% 2024 © Klaviyo 27 See Appendix for Non-GAAP reconciliation.
Slide 28: Guidance
Guidance ($ in millions) FY24 Q4 FY24 Revenue $256 - $258 $923 - $925 YoY Growth 27% - 28% 32% - 33% Non-GAAP Operating Income1 $7 - $9 $104 - $106 Non-GAAP Operating Margin 3% 11% 1 The Company’s non-GAAP operating income guidance includes an expense, expected to be in the low-teens millions of dol
Slide 29: Appendix
Appendix 2024 © Klaviyo 29
Slide 30: Summary Non-GAAP P&L
Summary Non-GAAP P&L ($ in millions) FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 Revenue $175.8 $201.6 $210.0 $222.2 $235.1 Cost of Revenue $35.5 $41.9 $42.4 $47.5 $52.1 Gross Profit $140.3 $159.8 $167.6 $174.7 $183.0 Gross margin % 79.8% 79.2% 79.8% 78.6% 77.8% Selling and marketing $56.2 $77.3 $66.7 $7
Slide 31: GAAP to Non-GAAP reconciliation of Operating (loss) income
GAAP to Non-GAAP reconciliation of Operating (loss) income ($ in thousands) FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 Operating loss ($302,203) ($36,330) ($22,092) ($14,053) ($13,278) Stock-based Compensation $299,975 $38,482 $35,627 $33,506 $31,557 Employer payroll tax on employee stock transactions
Slide 32: GAAP to Non-GAAP reconciliation of Gross Profit
GAAP to Non-GAAP reconciliation of Gross Profit ($ in thousands) FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 Gross profit $116,982 $156,605 $165,055 $171,942 $180,737 Stock-based Compensation $21,902 $3,028 $2,378 $2,621 $2,033 Employer payroll tax on employee stock transactions $1,451 $135 $184 $180 $238
Slide 33: GAAP to Non-GAAP reconciliation of Operating Expenses
GAAP to Non-GAAP reconciliation of Operating Expenses ($ in thousands) FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 Selling and marketing $167,877 $102,524 $91,858 $94,501 $100,018 Stock-based Compensation ($95,962) ($11,813) ($11,284) ($10,175) ($8,519) Employer payroll tax on employee stock transaction
Slide 34: Reconciliation of Operating Cash Flow to Free Cash Flow
Reconciliation of Operating Cash Flow to Free Cash Flow ($ in thousands) FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 Cash Provided by operating activities $23,700 $38,644 $26,182 $40,900 $38,784 Acquisition of property and equipment ($54) ($2,830) ($1,259) ($769) ($1,547) Capitalization of software deve
Slide 35: Select defined terms
Select defined terms Customers: We define a customer as a distinct paid subscription to our platform. A single organization could have multiple discrete contracting divisions or subsidiaries or brands each with paid subscriptions to our platform, which would, in general, constitute multiple distinct c
Slide 36: klaviyo
klaviyo™