Klaviyo, Inc. Series A · NYSE:KVYO
Klaviyo, Inc. Series A — Klaviyo — Q4 2023 Earnings Presentation
37 slides from Klaviyo, Inc. Series A's earnings presentation, Feb 27, 2024
Slide 1: Klaviyo Financial Results Q4 2023 / Fiscal 2023
Klaviyo Financial Results Q4 2023 / Fiscal 2023
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 $698M Revenue 117% Dollar-Based Net Revenue 31% EMEA and APAC 16% Free Cash Flow Margin3 Retention Rate2,4 Revenue 48% 143,000+ 1,958 2,4 11% Revenue Growth Total Customers Customers Generating Over Non-GAAP $50K ARR2,4 Operating Margin3 80% YoY Growth 1 All metrics for fiscal ye
Slide 6: Large and growing customer base
Large and growing customer base1 143,000+ Customers 1,958 Customers > $50K ARR 1 All metrics as of December 31, 2023. See Appendix for definitions of Customers and Customers Generating Over $50,000 of ARR. 2024 © Klaviyo 6
Slide 7: We help customers drive revenue
We help customers drive revenue Jones Road, a cosmetics company run by Bobbi Brown, used Klaviyo to help drive a Use cases: record setting BFCM in 2023. They increased their KAV this BFCM by over • Personalized segmentation 150% year over year. 150%+ • Automated flows YoY growth in KAV this BFCM 2023
Slide 8: 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 9: 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 10: Other solutions do not have the full stack to unlock all the capabilities required
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 10
Slide 11: Our vertically-integrated platform unifies data and application layers
Our vertically-integrated platform unifies data and application layers 1 As of December 31, 2023 2024 © Klaviyo 11
Slide 12: 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 13: 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 14: 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 15: Introducing Klaviyo AI
Introducing Klaviyo AI Your guide to smarter digital relationships Smarter insights More accurately anticipate what customers want (and when) with predictive analytics Smarter work Focus your team’s time on higher-impact work with generative AI everywhere Smarter decisions Put optimization on autopi
Slide 16: 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 17: 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 143,000+ Total Customers1 Deliver actionable Frictionless Land with in
Slide 18: 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 19: Whitespace for durable growth with sustained execution
Whitespace for durable growth with sustained execution ● $698M in FY23 Revenue1 Global TAM $68B ● $16B market in retail and eCommerce (~4% penetrated) ● $34B market across verticals in the U.S. (~2% penetrated) U.S. TAM $34B ● $68B market globally (~1% penetrated) SAM $16B $698M in FY23 Revenue1 1 F
Slide 20: 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 Olo, and data-fir
Slide 21: Financials
Financials 2024 © Klaviyo 21
Slide 22: Financial highlights from FY23 Q4
Financial highlights from FY23 Q41 Operating at Scale $202M Quarterly revenue Rapid Revenue Growth 39% Year-over-year growth rate Strong Expansion With Our Customers 117% Dollar-Based Net Revenue Retention Rate2 Momentum in the Mid Market 80% Year-over-year growth in Customers > $50K ARR Generating
Slide 23: Revenue growth at scale
Revenue growth at scale YoY Growth 63% 48% 62% 57% 51% 48% 39% 2024 © Klaviyo 23
Slide 24: Strong customer growth
Strong customer growth +20% +80% 2024 © Klaviyo 24
Slide 25: Continuing to diversify internationally
Continuing to diversify internationally Percentages rounded for presentation purposes. 2024 © Klaviyo 25
Slide 26: Gaining leverage in operating expenses while investing for growth
Gaining leverage in operating expenses while investing for growth Leverage drivers ▪ Revenue growth ▪ G&A absorbing public company readiness initiatives, including team build out ▪ R&D investing in product and engineering against new initiatives ▪ S&M investing behind strong unit economics to drive
Slide 27: Maintaining discipline on the bottom line
Maintaining discipline on the bottom line Non-GAAP (6%) 11% Operating Margin See Appendix for Non-GAAP reconciliation. 2024 © Klaviyo 27
Slide 28: Increasing free cash flow generation
Increasing free cash flow generation +$152M YoY TTM Free Cash Flow Margin (9%) (1%) 8% 15% 16% 2024 © Klaviyo 28 See Appendix for Non-GAAP reconciliation.
Slide 29: Guidance
Guidance ($ in millions) FY24 Q1 FY24 Revenue $201.0 - $203.0 $889.0 - $897.0 YoY Growth 29% - 30% 27% - 28% Non-GAAP Operating Income $22.5 - $25.5 $94.0 - $102.0 Non-GAAP Operating Margin 11% - 13% 11% - 11% 2024 © Klaviyo 29
Slide 30: Appendix
Appendix 2024 © Klaviyo 30
Slide 31: Summary Non-GAAP P&L
Summary Non-GAAP P&L (USD $M) FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 Revenue $145.2 $156.1 $164.6 $175.8 $201.6 Cost of Revenue $37.3 $35.4 $37.5 $35.5 $41.9 Gross Profit $107.9 $120.7 $127.1 $140.3 $159.8 Gross margin % 74.3% 77.3% 77.2% 79.8% 79.2% Selling and marketing $47.1 $45.5 $50.1 $56.2 $77
Slide 32: GAAP to Non-GAAP reconciliation of Operating Income
GAAP to Non-GAAP reconciliation of Operating Income (USD $K) FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 Operating Income (Loss) ($4,077) $878 $7,034 ($302,203) ($36,330) Stock-based Compensation $557 $1,823 $519 $299,975 $38,482 Employer payroll tax on employee stock transactions - - - $6,838 $822 Amor
Slide 33: GAAP to Non-GAAP reconciliation of Gross Profit
GAAP to Non-GAAP reconciliation of Gross Profit (USD $K) FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 Gross profit $107,904 $119,514 $127,110 $116,982 $156,605 Stock-based Compensation $24 $26 $17 $21,902 $3,028 Employer payroll tax on employee stock transactions - - - $1,451 $135 Restructuring - $1,156 -
Slide 34: GAAP to Non-GAAP reconciliation of Operating Expenses
GAAP to Non-GAAP reconciliation of Operating Expenses (USD $K) FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 Selling and marketing $60,447 $60,613 $63,357 $167,877 $102,524 Stock-based Compensation ($76) ($127) ($52) ($95,962) ($11,813) Employer payroll tax on employee stock transactions - - - ($2,515) ($
Slide 35: Free Cash Flow
Free Cash Flow (USD $K) FY22 Q4 FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 Cash Provided by (used in) operating activities $20,914 $15,552 $41,474 $23,700 $38,644 Acquisition of property and equipment ($1,429) ($325) ($444) ($54) ($2,830) Capitalization of software development costs ($898) ($1,306) ($1,530) ($
Slide 36: 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 37: klaviyo
klaviyo™