Goldman Sachs initiated or assumed coverage of four companies in the customer experience software sector in a note distributed on Wednesday, assigning Buy ratings to Twilio, Braze and Klaviyo while rating Zeta Global as Neutral. The bank framed its outlook around the influence of artificial intelligence on competitive dynamics across the category.
Analyst Callie Valenti told investors that Goldman is prioritizing firms that can "benefit from industry shifts driven by AI, have a differentiated infrastructure layer, and are in the early innings of a new product cycle." The bank supplied explicit price targets for each company: $300 for Twilio, $34 for Braze, $26 for Klaviyo and $28 for Zeta.
Goldman argued that AI is already prompting market share changes in customer service software, a trend the firm says should favor Twilio. In marketing software, the bank noted a parallel effect: as enterprises re-evaluate how to deliver modern consumer experiences, vendors with stronger technology stacks are positioned to take share from legacy providers.
Braze and Klaviyo were highlighted as particular opportunities in the marketing application space. Goldman asserted both stocks have experienced "unwarranted underperformance as a result of the AI driven bear case on application software" and that the market is not valuing the differentiation in their infrastructure layers. The note projects that Braze could reach roughly 20% operating margins in under three years as unit economics improve.
On Twilio, the bank quantified an expanding voice opportunity within its customer service addressable market. For Klaviyo, Goldman outlined a cross-sell opportunity into customer service offerings and assessed a remaining growth runway tied to its presence within the Shopify ecosystem.
Zeta's Neutral rating reflects Goldman's view that merger and acquisition activity yields superior returns on investment compared with some competitors, shaping the bank's relative stance on that stock.
Context and implications
The bank's coverage emphasizes AI-driven product cycles and infrastructure differentiation as key investment criteria. Goldman set concrete price targets for each company and pointed to margin expansion, cross-sell avenues and addressable market growth as the specific levers that could support upside for the Buy-rated names.