Twilio (TWLO) Beats Q4 Sales Targets but Stock Drops

Key Financials

* Revenue: $1.19 billion (11% YoY growth)
* Adjusted EPS: $1.00 (3.2% below estimates)
* Adjusted Operating Income: $197 million (16.5% margin)
* Revenue Guidance for Q1 CY2025: $1.14 billion (in line with estimates)
* Adjusted EPS Guidance for Q1 CY2025: $0.91 (below analyst estimates)
* Free Cash Flow Margin: 7.8%

Overview

Twilio is a cloud communications platform that enables software developers to integrate voice, messaging, and other communication features into their applications.

Historical Growth

Twilio has historically exhibited strong revenue growth, with a 16.2% compounded annual growth rate over the past three years.

Customer Acquisition and Retention

* Customers: 325,000 (up from 320,000 previous quarter)
* Net Revenue Retention Rate: 106%

Market Outlook

Analysts anticipate revenue growth of 7.7% over the next 12 months, indicating potential demand headwinds.

Investment Considerations

* Twilio's customer growth and revenue outperformance are positive indicators.
* However, the missed EPS guidance and in-line revenue guidance suggest a weaker quarter.
* Investors should assess the stock's valuation and long-term business quality before making an investment decision.