Klaviyo Bets Big on Agentic AI With Surprise Agency Acquisition as Composer Adoption Hits 95,000 Users in Its First Month
Q2 2026 earnings call, August 5, 2026 — Klaviyo raises full-year guidance, announces CFO and CPO transitions alongside accelerating enterprise wins
Klaviyo used its second-quarter earnings call to unveil a cluster of strategic moves that reset the narrative around the company: an acquisition of Elias Torres's Agency, a rapid customer ramp for its new Composer agent, and a leadership shuffle that installs Torres as Chief Product Officer while Amanda Whalen hands the CFO reins to Erica Smith on September 1. Together, these announcements mark Klaviyo's most aggressive push yet to reposition itself from an e-commerce marketing tool into what Co-Founder and Co-CEO Andrew Bialecki calls an "autonomous B2C CRM."
Composer's Fast Start and the Agency Deal
The headline product news was Composer, Klaviyo's agent harness for building and optimizing marketing campaigns, which launched broadly in June and already has more than 95,000 users, with nearly a quarter converting into recurring weekly users. Credit consumption grew 30% week-over-week as recently as last week, and enterprise adoption is outpacing the broader base, with 27% of mid-market and enterprise customers now active on the product. Bialecki said the percentage of AI-generated campaigns that customers actually kept and used climbed to 46%, up from 35% just weeks earlier, as the company tuned "taste, alignment and validation."
To accelerate that roadmap, Klaviyo is acquiring the team behind Agency, whose founder Elias Torres will join as Chief Product Officer. Bialecki, who has known Torres for over a decade, framed the deal as a way to compress the timeline on a shared conviction: "Every business will have an agent that decides, delivers and autonomously optimizes the experiences their customers have. That's the promise of an autonomous B2C CRM." The acquisition will cost $10 million to $12 million this year, a charge embedded in the reduced operating income guidance, and the two co-CEOs described a division of labor where Bialecki and Torres, both engineers, split time between enterprise customer work and the expanding agent product surface.
Leadership Transition at CFO
Whalen, who has held the CFO seat for more than four years and oversaw Klaviyo's IPO, is departing but will stay on in an advisory capacity through November. Erica Smith, who Chano Fernandez (referred to on the call as Luciano Fernandez Gomez) described as bringing "deep software experience at the scale we are heading into," takes over September 1. Whalen used her final call to reflect on the company's growth trajectory since her first conversations with Bialecki, calling the handoff "seamless" and expressing confidence in the business heading into its next phase.
Enterprise Momentum Is Building, But It's Still Early
Klaviyo signed its largest deal ever in the quarter, an eight-figure, two-year multiproduct agreement with a fast-growing e-commerce brand and top TikTok Shop seller. New enterprise logos included Warner Music Group, Claire's (won by displacing two legacy vendors), the San Francisco 49ers, and Country Road Group in APAC, where the win came through a competitive RFP that consolidated five brands onto one platform. Customers with $50,000-plus ARR grew 36% year-over-year to 4,477 accounts and now represent roughly 40% of total ARR.
Fernandez was candid that this is a multi-year sales transformation rather than an inflection already complete. "This enterprise business is going to be a journey," he said, describing a shift from transactional, single-stakeholder sales to consultative, multi-stakeholder, business-case-driven deals. He noted the team is winning roughly three out of four competitive deals it enters and that sales headcount has stayed flat while productivity per rep has risen, a deliberate choice rather than a capacity constraint. Investors should note this implies enterprise growth, while real, is still being built on newly hired sales leadership and unproven long-cycle motions.
Revenue Beat, Guidance Raised, But Margin Give-Back
Second-quarter revenue reached $370.6 million, up 26% year-over-year and ahead of guidance, driven by strength in text messaging, WhatsApp, and marketing analytics. Klaviyo raised its full-year 2026 revenue guidance by $12 million at the midpoint to a range of $1.526 billion to $1.534 billion, implying 24% growth, a raise that exceeded the quarter's beat. Third-quarter revenue guidance calls for $377 million to $381 million, or roughly 21.5% to 22.5% growth, a deceleration investors will want to watch closely.
Non-GAAP gross margin came in at 73.4%, down 3 points year-over-year, pressured by rising carrier fees the company had been absorbing and the growing mix of lower-margin text messaging revenue. CFO Whalen said Klaviyo is now passing those carrier fee increases through to customers starting in the third quarter, a change expected to be neutral to both revenue and gross margin for the year as it phases in through contract renewals. Management guided to a further step-down in gross margin in the fourth quarter as text continues to outgrow the overall business. Full-year non-GAAP operating income guidance was cut by $10 million at the midpoint to $212 million-$218 million, reflecting both the Agency acquisition costs and continued R&D investment.
Multiproduct and International Growth Remain Structural Tailwinds
Nearly 20% of ARR now comes from customers using three or more products, and Klaviyo highlighted that multiproduct customers retain more than 6 points better on gross retention than single-product accounts. International revenue grew 35% year-over-year, with EMEA revenue outside the U.K. up 41%. The company is opening a France office and an EU data center in the second half of the year, and Bialecki reiterated a long-term goal of having the majority of revenue eventually come from outside North America. WhatsApp adoption is also pulling in new geographies, including a recent large deal in Brazil.
Net Revenue Retention Still Weighed Down by Prior-Year Enforcement
Net revenue retention was 109% in the quarter, with management pointing to improving gross retention, strong text expansion, and the strongest cross-sell quarter since the IPO. However, the metric continues to be suppressed by the lapping of last year's profile enforcement action, an effect Whalen said will persist as a trailing 12-month drag through the first quarter of next year. Management was careful not to commit to NRR reaccelerating on a specific timeline, though the underlying retention and expansion trends they cited suggest the metric's headline number understates current momentum.
Capital Returns Continue Alongside M&A Appetite
Klaviyo generated $83 million in cash during the quarter and ended with $833 million in total cash. The company spent approximately $240 million on share repurchases, leaving $160 million of capacity under its $500 million buyback authorization from March. Whalen said the company remains active in the market, calling the current valuation "an attractive opportunity," while also signaling continued willingness to pursue M&A that accelerates the product roadmap, as it just did with Agency.