Klaviyo Inc. (NYSE: KVYO) shares jumped 6.7% on Monday after management announced a $500 million share repurchase program, which includes a $100 million accelerated share repurchase to begin immediately.
The program, approved by Klaviyo's board of directors, constitutes about 10% of the company's market capitalization and is the first time the firm has authorized a share buyback.
In a statement accompanying the announcement, co-founder and co-CEO Andrew Bialecki said the authorization and the accelerated repurchase "underscores the confidence our board of directors and management team have in the durability of our strategy, the scale of the opportunity ahead, and our belief that Klaviyo represents an attractive long-term investment."
Financially, Klaviyo finished 2025 holding more than $1 billion in cash and cash equivalents and carrying no debt. The company also generated $190 million in free cash flow for the year, figures cited alongside the buyback disclosure.
William Blair analyst Arjun Bhatia reaffirmed an Outperform rating on Klaviyo following the announcement. Bhatia noted that this marks the company's first share buyback and observed that it follows a wave of software companies announcing or expanding repurchase programs. He emphasized that the $500 million authorization represents roughly 10% of Klaviyo's market capitalization and interpreted the move as a signal of management's confidence in the business' durability and its long-term growth potential. In his comment, Bhatia added that he believes shares are undervalued at 15 times free cash flow.
Further valuation context from Bhatia indicates Klaviyo trades at 15 times 2027 free cash flow estimates, and he projects free cash flow growth in the high 20s percentage range in 2026.
Taken together, the immediate $100 million accelerated repurchase and the broader $500 million authorization mark a significant capital allocation decision for Klaviyo. The board-approved program and the company's cash-rich, debt-free balance sheet were highlighted as underpinning elements of management's rationale. The analyst response cited the buyback as an expression of confidence and as a valuation signal tied to estimated free cash flow multiples and growth expectations.
No additional operational changes or future buyback pacing details were disclosed beyond the size of the program and the immediate $100 million accelerated repurchase.