Klaviyo (KVYO) has had a rough stretch over the past year. The stock is down roughly 46% year-to-date (YTD), leaving investors with many questions. But a fresh strategic partnership with Alphabet's (GOOG) (GOOGL) Google and a better-than-expected fourth quarter may be giving bulls reason to take a second look.
The question is whether this is a genuine turning point or just a headline that fades.
Klaviyo Delivered Record Numbers in Q4
Before getting to the Google news, it's worth understanding what Klaviyo does and how the business is performing.
Klaviyo builds what it calls an autonomous business-to-consumer (B2C) customer relationship management (CRM) platform. Basically, it helps brands send smarter marketing messages and automate customer service using artificial intelligence and real-time data. Think personalized emails, text messages, and AI chat agents, all powered by data from customer purchases, browsing habits, and engagement history.
The business is growing fast.
- For the full year 2025, Klaviyo reported revenue of $1.234 billion, up 32% year-over-year (YoY).
- Every single quarter of the year grew at least 30% compared to the prior year.
- Fourth-quarter revenue hit $350 million, up 30% YoY. The company now has an annualized revenue run rate of $1.4 billion.
Profitability is improving, too. Non-GAAP operating income for Q4 was $51 million, a 15% margin and 900 basis points better than a year ago. Free cash flow surged 61% YoY to $87 million, and Klaviyo crossed $1 billion in cash on hand for the first time.
Its largest customers are growing fast as well. The number of clients contributing at least $50,000 in annual recurring revenue (ARR) jumped 37% YoY to 3,912. The number generating over $1 million in ARR doubled last year alone.
"Our guide is a strong baseline that reflects the momentum we're seeing across our core business," Co-CEO and Chief Financial Officer Amanda Whalen said during the company's Q4 2025 earnings call.
What the Klaviyo-Google Partnership Means for Investors
Klaviyo recently announced a strategic partnership with Google designed to connect product discovery, purchase, service, and loyalty into one seamless customer experience, according to a company statement.
The deal combines Google's reach across search, advertising, and messaging with Klaviyo's real-time customer data platform, which processes 3.4 billion daily customer interactions across more than eight billion profiles.
One of the most notable pieces is RCS for Business, a next-generation mobile messaging format that goes well beyond standard SMS. With RCS, brands can send product carousels, rich media, and even engage in conversational exchanges—all within a native text message thread.
Klaviyo is among the first globally to offer customers a direct path from Google Search into an RCS conversation with an AI-powered customer agent, the company said. The feature is currently in a limited pilot.
"Commerce is entering a phase where software doesn't just execute tasks, it makes decisions," Klaviyo Co-Founder and Co-CEO Andrew Bialecki said in a company statement. "Together with Google, we're expanding how AI and customer data power experiences across commerce, messaging, and real-world interactions."
Existing integrations, including Google Ads and BigQuery, are already live, giving enterprise brands tools to centralize and activate Klaviyo data within Google's ecosystem.
The RCS channel was directly cited by Bialecki as a major growth driver during the earnings call. He described consumers being able to browse full product catalogs and even make buying decisions directly inside a text message.
Is KVYO Stock a Buy Right Now?
Klaviyo's fundamentals are strong. Revenue is growing at 30%-plus. Margins are expanding. The company just raised its full-year 2026 revenue guidance to between $1.501 billion and $1.509 billion, implying roughly 22% growth.
And management says that guidance is deliberately conservative and assumes minimal contribution from newer AI and service products like Customer Agent, which already helped one customer (LifeStraw) achieve a 111% increase in AI-generated sales.
The Google partnership adds a powerful distribution channel and real-world credibility. Being named a key marketing player in "agentic commerce" by a company the size of Google isn't a small thing.
That said, a 46% decline in a stock doesn't happen for no reason. Investors will want to see the enterprise momentum that new Co-CEO Chano Fernandez is promising actually translate into win rates and revenue over the coming quarters.
What Analysts Are Saying
Analysts tracking the tech stock forecast free cash flow to increase from $200.4 million in 2025 to $434 million in 2030. Given a 20x forward FCF multiple, Klaviyo could return 64% over the next three years.
Out of the 23 analysts covering KVYO stock, 20 recommend “Strong Buy,” one recommends “Moderate Buy,” and two recommend “Hold.” The average Klaviyo stock price target is $33.76, above the current price of about $17.
The setup is interesting, and the risks are real. But for investors with patience and a high-growth appetite, Klaviyo's combination of AI infrastructure, a growing enterprise pipeline, and now a Google-backed distribution play makes Klaviyo worth watching closely.
On the date of publication, Aditya Raghunath did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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