Klaviyo Reports 33.3% Revenue Growth to $279.8 Million in Q1 2025

Klaviyo, Inc. reported significant financial performance for the first quarter of 2025, with revenue reaching $279.8 million, a 33.3% increase from $210.0 million in the same period last year. The company's gross profit also rose to $212.1 million, up 28.5% from $165.1 million in Q1 2024. However, Klaviyo recorded a net loss of $14.1 million, slightly higher than the $12.9 million loss reported in the previous year. The increase in revenue was attributed to new customer acquisitions and expanded usage of the platform, particularly in the SMS channel, which accounted for a significant portion of the growth.

Operating expenses for the quarter increased to $235.9 million, up from $187.1 million in Q1 2024, driven primarily by higher selling and marketing costs, which rose by 34.5% to $123.5 million. This increase was largely due to higher personnel expenses and marketing initiatives. Research and development expenses also grew by 23.6% to $69.3 million, reflecting the company's commitment to innovation and product development. General and administrative expenses increased by 9.7% to $43.0 million, primarily due to higher payment processing fees and personnel costs.

Klaviyo's customer base expanded to over 169,000 as of March 31, 2025, with 3,030 customers generating over $50,000 in annual recurring revenue (ARR), a 40% increase year-over-year. The company's dollar-based net revenue retention rate was reported at 108%, down from 114% in the previous year, indicating a slight decline in the expansion of existing customer plans. The company continues to focus on its land-and-expand strategy, which aims to increase revenue from existing customers as they grow and utilize more of Klaviyo's offerings.

In terms of operational developments, Klaviyo has made strides in geographic expansion, with international sales accounting for 33.7% of total revenue in the first quarter. The company has also launched new products, including the Klaviyo B2C CRM, which aims to address the needs of consumer brands. Klaviyo's strategic partnership with Shopify remains a key component of its marketing strategy, with the company incurring $7.9 million in fees related to this collaboration during the quarter.

Looking ahead, Klaviyo anticipates continued growth driven by customer acquisition, product innovation, and international expansion. The company plans to invest further in its platform and marketing efforts to enhance customer engagement and drive revenue growth. However, Klaviyo acknowledges the challenges posed by market conditions and competition, which may impact its ability to sustain historical growth rates. The company remains focused on adapting its offerings to meet the evolving needs of its customers and expanding its presence in new verticals and markets.