Twilio (TWLO)
Market Price (2/21/2026): $112.91 | Market Cap: $17.3 BilSector: Information Technology | Industry: Systems Software
Twilio (TWLO)
Market Price (2/21/2026): $112.91Market Cap: $17.3 BilSector: Information TechnologyIndustry: Systems Software
Investment Highlights Why It Matters Detailed financial logic regarding cash flow yields vs trend-riding momentum.
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 17%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 16% | Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 135x, P/EPrice/Earnings or Price/(Net Income) is 258x |
| Megatrend and thematic driversMegatrends include Cloud Computing, E-commerce & DTC Adoption, and Fintech & Digital Payments. Themes include Platform as a Service (PaaS), Show more. | Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 12% |
| Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.9% | |
| Key risksTWLO key risks include [1] significant profitability and margin pressures in its core messaging business, Show more. |
| Attractive cash flow generationCFO/Rev LTMCash Flow from Operations / Revenue (Sales), Last Twelve Months (LTM) is 17%, FCF/Rev LTMFree Cash Flow / Revenue (Sales), Last Twelve Months (LTM) is 16% |
| Megatrend and thematic driversMegatrends include Cloud Computing, E-commerce & DTC Adoption, and Fintech & Digital Payments. Themes include Platform as a Service (PaaS), Show more. |
| Expensive valuation multiplesP/EBITPrice/EBIT or Price/(Operating Income) ratio is 135x, P/EPrice/Earnings or Price/(Net Income) is 258x |
| Significant share based compensationSBC/Rev LTMShare Based Compensation / Revenue (Sales), Last Twelve Months (LTM) is 12% |
| Yield minus risk free rate is negativeERPEquity Risk Premium (ERP) = Total Yield - Risk Free Rate, Reflects the premium above risk free assets offered by the investment. is -3.9% |
| Key risksTWLO key risks include [1] significant profitability and margin pressures in its core messaging business, Show more. |
Qualitative Assessment
AI Analysis | Feedback
1. Decelerating Organic Revenue Growth Outlook: Despite beating Q4 2025 revenue and EPS estimates, Twilio's stock declined due to a projected slowdown in its core organic revenue growth. The company guided for organic revenue growth of 10-11% for Q1 2026 and 8-9% for the full fiscal year 2026, which is a decrease compared to the 12% organic growth reported in Q4 2025 and 13% for the full year 2025.
2. Significant Insider Selling Activity: A notable factor was the substantial insider selling, particularly by Director Andrew Stafman, who sold 1,000,000 shares for a total transaction amount of $129,000,000 on December 2, 2025. This sale contributed to over $135 million in insider sales during the last quarter (prior to February 13, 2026).
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Stock Movement Drivers
Fundamental Drivers
The -16.1% change in TWLO stock from 10/31/2025 to 2/20/2026 was primarily driven by a -16.1% change in the company's P/E Multiple.| (LTM values as of) | 10312025 | 2202026 | Change |
|---|---|---|---|
| Stock Price ($) | 134.88 | 113.14 | -16.1% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 4,896 | 4,896 | 0.0% |
| Net Income Margin (%) | 1.4% | 1.4% | 0.0% |
| P/E Multiple | 307.3 | 257.7 | -16.1% |
| Shares Outstanding (Mil) | 153 | 153 | 0.0% |
| Cumulative Contribution | -16.1% |
Market Drivers
10/31/2025 to 2/20/2026| Return | Correlation | |
|---|---|---|
| TWLO | -16.1% | |
| Market (SPY) | 1.1% | 41.1% |
| Sector (XLK) | -6.3% | 46.8% |
Fundamental Drivers
The -12.3% change in TWLO stock from 7/31/2025 to 2/20/2026 was primarily driven by a -18.0% change in the company's P/S Multiple.| (LTM values as of) | 7312025 | 2202026 | Change |
|---|---|---|---|
| Stock Price ($) | 129.00 | 113.14 | -12.3% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 4,583 | 4,896 | 6.8% |
| P/S Multiple | 4.3 | 3.5 | -18.0% |
| Shares Outstanding (Mil) | 153 | 153 | 0.1% |
| Cumulative Contribution | -12.3% |
Market Drivers
7/31/2025 to 2/20/2026| Return | Correlation | |
|---|---|---|
| TWLO | -12.3% | |
| Market (SPY) | 9.4% | 34.9% |
| Sector (XLK) | 7.4% | 36.2% |
Fundamental Drivers
The -22.8% change in TWLO stock from 1/31/2025 to 2/20/2026 was primarily driven by a -34.2% change in the company's P/S Multiple.| (LTM values as of) | 1312025 | 2202026 | Change |
|---|---|---|---|
| Stock Price ($) | 146.58 | 113.14 | -22.8% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 4,339 | 4,896 | 12.8% |
| P/S Multiple | 5.4 | 3.5 | -34.2% |
| Shares Outstanding (Mil) | 159 | 153 | 3.9% |
| Cumulative Contribution | -22.8% |
Market Drivers
1/31/2025 to 2/20/2026| Return | Correlation | |
|---|---|---|
| TWLO | -22.8% | |
| Market (SPY) | 15.6% | 52.2% |
| Sector (XLK) | 22.6% | 54.1% |
Fundamental Drivers
The 89.1% change in TWLO stock from 1/31/2023 to 2/20/2026 was primarily driven by a 34.3% change in the company's Total Revenues ($ Mil).| (LTM values as of) | 1312023 | 2202026 | Change |
|---|---|---|---|
| Stock Price ($) | 59.84 | 113.14 | 89.1% |
| Change Contribution By: | |||
| Total Revenues ($ Mil) | 3,644 | 4,896 | 34.3% |
| P/S Multiple | 3.0 | 3.5 | 17.3% |
| Shares Outstanding (Mil) | 184 | 153 | 20.0% |
| Cumulative Contribution | 89.1% |
Market Drivers
1/31/2023 to 2/20/2026| Return | Correlation | |
|---|---|---|
| TWLO | 89.1% | |
| Market (SPY) | 75.9% | 42.2% |
| Sector (XLK) | 111.5% | 40.0% |
Price Returns Compared
| 2021 | 2022 | 2023 | 2024 | 2025 | 2026 | Total [1] | |
|---|---|---|---|---|---|---|---|
| Returns | |||||||
| TWLO Return | -22% | -81% | 55% | 42% | 32% | -22% | -67% |
| Peers Return | 16% | -45% | 45% | -19% | 1% | 4% | -21% |
| S&P 500 Return | 27% | -19% | 24% | 23% | 16% | 0% | 83% |
Monthly Win Rates [3] | |||||||
| TWLO Win Rate | 33% | 17% | 50% | 58% | 50% | 0% | |
| Peers Win Rate | 67% | 33% | 58% | 48% | 50% | 40% | |
| S&P 500 Win Rate | 75% | 42% | 67% | 75% | 67% | 50% | |
Max Drawdowns [4] | |||||||
| TWLO Max Drawdown | -27% | -84% | -6% | -30% | -25% | -24% | |
| Peers Max Drawdown | -20% | -56% | -10% | -28% | -32% | -15% | |
| S&P 500 Max Drawdown | -1% | -25% | -1% | -2% | -15% | -1% | |
[1] Cumulative total returns since the beginning of 2021
[2] Peers: MDB, VRSN, OKTA, AKAM, CHOW. See TWLO Returns vs. Peers.
[3] Win Rate = % of calendar months in which monthly returns were positive
[4] Max drawdown represents maximum peak-to-trough decline within a year
[5] 2026 data is for the year up to 2/20/2026 (YTD)
How Low Can It Go
| Event | TWLO | S&P 500 |
|---|---|---|
| 2022 Inflation Shock | ||
| % Loss | -90.4% | -25.4% |
| % Gain to Breakeven | 937.6% | 34.1% |
| Time to Breakeven | Not Fully Recovered days | 464 days |
| 2020 Covid Pandemic | ||
| % Loss | -45.6% | -33.9% |
| % Gain to Breakeven | 84.0% | 51.3% |
| Time to Breakeven | 52 days | 148 days |
| 2018 Correction | ||
| % Loss | -39.3% | -19.8% |
| % Gain to Breakeven | 64.7% | 24.7% |
| Time to Breakeven | 182 days | 120 days |
Compare to MDB, VRSN, OKTA, AKAM, CHOW
In The Past
Twilio's stock fell -90.4% during the 2022 Inflation Shock from a high on 2/18/2021. A -90.4% loss requires a 937.6% gain to breakeven.
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About Twilio (TWLO)
AI Analysis | Feedback
- Twilio is like the **Stripe for communications**, providing APIs for developers to easily integrate voice, video, and messaging into their apps.
- Think of Twilio as **AWS for communications infrastructure**, offering the cloud building blocks for companies to add calling, texting, and other communication features without managing complex telecom networks.
AI Analysis | Feedback
- Twilio Programmable Messaging (SMS): Provides APIs for sending and receiving text messages, enabling notifications, alerts, and conversational interfaces for businesses.
- Twilio Programmable Voice (Voice): Offers APIs to embed voice calling capabilities into applications, facilitating features like call routing, IVRs, and conference calls.
- Twilio SendGrid (Email): A cloud-based platform for sending transactional and marketing emails at scale, focusing on deliverability and performance.
- Twilio Flex (Contact Center): A customizable cloud-based contact center platform, allowing businesses to build tailored customer service experiences across multiple communication channels.
- Twilio Programmable Video (Video): Delivers APIs for integrating real-time video and audio communication into applications, supporting various use cases from telehealth to education.
- Twilio Verify (Authentication): An API for implementing multi-factor authentication (MFA) and user verification via SMS, voice, or email to enhance security and prevent fraud.
AI Analysis | Feedback
Twilio (symbol: TWLO) primarily sells its communication platform and services to other companies (Business-to-Business, or B2B). It provides developers with APIs to embed voice, video, messaging, and email capabilities into their applications. While Twilio has a highly diversified customer base and typically does not have individual customers representing a significant percentage of its total revenue, certain prominent public companies are widely known to be major users of its platform for their communication needs. These companies exemplify the types of organizations that rely on Twilio's services. Here are examples of such customer companies:- Uber Technologies, Inc. (NYSE: UBER) - Utilizes Twilio for connecting riders and drivers, sending notifications, and managing support communications.
- Lyft, Inc. (NASDAQ: LYFT) - Similar to Uber, uses Twilio for facilitating communication between passengers and drivers, and for service alerts.
- DoorDash, Inc. (NASDAQ: DASH) - Employs Twilio for coordinating deliveries between customers, dashers, and restaurants.
- Block, Inc. (NYSE: SQ) - Formerly Square, uses Twilio for customer notifications, account verification, and other secure communications across its ecosystem of services (e.g., Square, Cash App).
- Airbnb, Inc. (NASDAQ: ABNB) - Relies on Twilio for facilitating communication between hosts and guests, and for booking notifications.
- Netflix, Inc. (NASDAQ: NFLX) - Uses Twilio for critical customer interactions such as account verification, password resets, and service notifications.
- Shopify Inc. (NYSE: SHOP) - While merchants on Shopify's platform might directly integrate Twilio, Shopify itself, or its larger partners, use Twilio for various communication features related to e-commerce and customer engagement.
- HubSpot, Inc. (NYSE: HUBS) - Integrates Twilio's capabilities to enhance communication features within its CRM, marketing, sales, and customer service platforms.
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- Amazon.com, Inc. (AMZN)
- Alphabet Inc. (GOOGL)
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Khozema Shipchandler Chief Executive Officer
Khozema Shipchandler was appointed CEO of Twilio in January 2024. He has over 25 years of experience in growing businesses and driving financial performance across global public organizations. Prior to his CEO appointment, he served as President of Twilio Communications from March 2023 to January 2024. He also held the roles of Chief Operating Officer at Twilio from October 2021 to October 2021 and Chief Financial Officer from November 2018 to October 2021. Before joining Twilio, Shipchandler spent over two decades at GE, where he held various financial and operating roles across Industrial Internet, Aviation, and Corporate Audit in the U.S., Middle East, and Singapore. His roles at GE included Chief Commercial Officer and Executive Vice President of Corporate Development at GE Digital, and Chief Financial Officer for the Middle East, North Africa & Turkey. He currently serves on the boards of Smartsheet and Ethos.
Aidan Viggiano Chief Financial Officer
Aidan Viggiano became Twilio's Chief Financial Officer in March 2023. She joined Twilio in 2019 as Vice President of Corporate Finance and was promoted to Senior Vice President of Finance in 2021, a role she held until 2023. Before her tenure at Twilio, Viggiano spent 16 years at General Electric, from 2003 to 2019, where she held various finance leadership positions, including Investor Relations and Chief of Staff to the CFO. She holds a B.S. in Economics from the Wharton School of the University of Pennsylvania.
Jeff Lawson Co-Founder (Former CEO and Chairman)
Jeff Lawson co-founded Twilio in 2008 and served as its CEO and Chairman until stepping down in January 2024. He is a serial entrepreneur, having founded Versity.com in 1998, which was later sold. He was also the founding CTO of StubHub and a co-founder and CTO of NineStar. Additionally, he contributed to the development of Amazon Web Services (AWS) during his time at Amazon. Lawson led Twilio through its initial public offering in 2016. In 2024, he acquired the satirical news site The Onion.
Christy Lake Chief People Officer
Christy Lake serves as the Chief People Officer at Twilio. In this role, she is responsible for the company's human resources strategies, which include driving talent acquisition, employee engagement, and organizational development initiatives. With a career spanning over two decades, Lake has held significant HR leadership roles at several companies, including Box, Medallia, and Hewlett-Packard.
Chris Koehler Chief Marketing Officer
Chris Koehler is the Chief Marketing Officer at Twilio, a position he assumed in May 2024. He oversees the company's global marketing strategies and is responsible for driving brand growth. Koehler brings a strong background in marketing and customer success, having held significant roles at companies such as Box and Adobe before joining Twilio.
AI Analysis | Feedback
Key Risks to Twilio (TWLO) Business:- Profitability and Margin Pressures: Twilio faces challenges with thin profit margins, particularly in its core messaging business, which is impacted by rising carrier fees and cloud infrastructure costs. The company's profitability is also affected by slowing revenue growth and difficulties in improving overall margins, leading to investor concern regarding its long-term financial performance.
- Intense Competition and Commoditization: The Communications Platform as a Service (CPaaS) market is highly competitive, leading to pricing pressure and the commoditization of Twilio's foundational SMS offerings. Twilio competes with various CPaaS providers, over-the-top (OTT) messaging applications, and major cloud infrastructure providers, making it challenging to differentiate its services and sustain market share and revenue growth.
- Regulatory and Compliance Complexity: Operating across numerous international markets exposes Twilio to a dynamic and intricate web of data privacy laws (such as GDPR and CCPA), telecommunications regulations, and evolving mandates like Know Your Customer (KYC) requirements. Non-compliance with these diverse regulatory frameworks can lead to substantial financial penalties and operational disruptions, necessitating continuous investment in legal and compliance resources.
AI Analysis | Feedback
The primary clear emerging threat to Twilio comes from major cloud hyperscalers like Amazon Web Services (AWS) and Microsoft Azure directly competing in the Communications Platform as a Service (CPaaS) space.
AWS offers services such as AWS Chime SDK (for voice, video, and messaging capabilities) and AWS Pinpoint (for marketing and transactional SMS, voice, and email). Microsoft Azure provides Azure Communication Services (ACS), which offers similar APIs for voice, video, chat, and SMS.
These hyperscalers present a threat because they can offer deeply integrated communication services within their existing cloud ecosystems. Customers already heavily invested in AWS or Azure infrastructure may find it simpler, potentially more cost-effective (due to unified billing and reduced egress costs), and more efficient to leverage native communication services from their primary cloud provider rather than integrating a third-party CPaaS like Twilio. This trend could lead to Twilio being disintermediated from new projects, particularly for enterprises already deeply embedded in a specific cloud ecosystem, as the cloud providers build their own compelling communication layers.
AI Analysis | Feedback
Twilio (symbol: TWLO) operates within large and expanding addressable markets for its main products and services, primarily globally.
-
Overall Total Addressable Market (TAM): Twilio's total addressable market for communications and data is projected to reach approximately $119 billion by 2028, growing at an annual rate of 11% globally.
-
Expanded Total Addressable Market (TAM) with AI and CXaaS: By focusing on conversational AI and the Customer Experience as a Service (CXaaS) market, Twilio aims to expand its total addressable market to $158 billion by 2028 globally. This expansion includes an additional $39 billion driven by conversational AI and orchestration, covering areas such as Communications Platform as a Service (CPaaS), Contact Center as a Service (CCaaS), and Customer Data Platform (CDP).
While specific market sizes for individual products are often integrated into these broader categories, Twilio's main offerings contribute to these substantial global markets:
-
Communications Platform (CPaaS): This core offering includes programmable messaging (SMS, MMS, WhatsApp), voice, video, and email APIs. This is a significant component of the $119 billion global "communications and data" TAM.
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Twilio Segment (Customer Data Platform - CDP): Segment helps businesses collect, clean, and activate customer data to create unified customer profiles. It underpins Twilio's customer engagement strategy and contributes to the larger CXaaS market.
-
Twilio Flex (Contact Center as a Service - CCaaS): Flex is a customizable cloud contact center platform. As part of the CXaaS market, it contributes to the projected $158 billion global TAM by 2028.
-
Twilio SendGrid (Email API and Marketing Campaigns): SendGrid provides email API services and marketing campaign tools, reliably delivering billions of emails monthly. Its market size is embedded within the broader communications and customer engagement markets, operating globally.
-
Twilio Engage (Marketing Automation Platform): Built on Twilio Segment and communication APIs, Engage is a growth automation platform for marketers. Its market size is part of the larger customer engagement and CXaaS markets.
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Twilio (TWLO) is expected to drive future revenue growth over the next 2-3 years through several key strategies:- Expansion of AI-Powered Products and Solutions: Twilio is heavily focused on integrating artificial intelligence into its offerings, with management seeing sustained revenue growth potential from increased adoption of AI-powered voice, conversation management, and authentication tools. The company has reported explosive voice AI revenue growth, with voice AI adoption growing 60% year-over-year. These higher-margin AI use cases are expected to become a larger portion of the revenue mix, directly boosting overall profitability. Twilio's acquisition of Stytch, an identity platform, is also aimed at accelerating capabilities in digital trust and expanding into identity solutions for AI agents.
- Growth in Customer Accounts and Increased Spending from Existing Customers: Twilio has demonstrated strong performance in growing its customer base, achieving a notable 22.5% year-over-year growth in customer accounts in Q3 2025. Furthermore, the company's Dollar-Based Net Expansion Rate (DBNER) of 109% in Q3 2025 (up from 108% in the previous quarter and 102% in Q2 2024) indicates that existing customers are increasing their spending on Twilio's platform. This expansion within the existing customer base, along with attracting new customers through self-serve and Independent Software Vendor (ISV) channels, is a significant driver.
- Acceleration of Core Communication Services (Messaging and Voice): Despite the focus on AI, Twilio's core messaging and voice services continue to be strong revenue drivers. Messaging revenue grew in the high teens for the second consecutive quarter in Q3 2025, and voice revenue growth accelerated to the mid-teens, its fastest growth rate in over three years. The company continues to see broad-based strength across its product suite, with significant growth in both voice services and messaging.
- International Expansion: Twilio's CEO, Khozema Shipchandler, has emphasized the company's strategic focus on international expansion as a key driver for future growth. This is further supported by strong growth observed in messaging internationally.
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Share Repurchases
- Twilio authorized a $1.0 billion share repurchase program in February 2023, set to expire on December 31, 2024.
- An additional $2.0 billion share repurchase program was authorized in March 2024, also expiring by December 31, 2024. By that time, nearly $800 million had already been repurchased from the initial program, with a target to complete both programs, totaling approximately $2.2 billion in further repurchases, by the end of 2024.
- In January 2025, a new $2.0 billion share repurchase program was authorized, slated to expire on December 31, 2027. By September 30, 2025, Twilio had repurchased $670.5 million under this program, with approximately $1.3 billion remaining.
Share Issuance
- In August 2020, Twilio commenced an underwritten public offering of $1.25 billion of Class A common stock.
- Twilio announced the pricing of an upsized $1.54 billion public offering of Class A common stock in February 2021.
- A follow-on offering in May 2021 raised an additional $1.8 billion.
Outbound Investments
- Twilio acquired Segment, a customer data platform, for approximately $3.2 billion in an all-stock deal in October 2020.
- In May 2021, Twilio acquired Ionic Security, a cloud data security solutions provider, and Zipwhip, a text messaging platform, for undisclosed amounts.
- Twilio has made 25 investments across various sectors, with its most recent being a Series B round in Hyro on December 10, 2024.
Latest Trefis Analyses
Trade Ideas
Select ideas related to TWLO.
| Date | Ticker | Company | Category | Trade Strategy | 6M Fwd Rtn | 12M Fwd Rtn | 12M Max DD |
|---|---|---|---|---|---|---|---|
| 01302026 | ROP | Roper Technologies | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | -13.4% | -13.4% | -13.8% |
| 01302026 | TDC | Teradata | Dip Buy | DB | FCFY OPMDip Buy with High FCF Yield and High MarginBuying dips for companies with high FCF yield and meaningfully high operating margin | 17.7% | 17.7% | -8.7% |
| 01302026 | CVLT | CommVault Systems | Dip Buy | DB | CFO/Rev | Low D/EDip Buy with High Cash Flow MarginsBuying dips for companies with significant cash flows from operations and reasonable debt / market cap | 2.3% | 2.3% | -5.1% |
| 01302026 | NTNX | Nutanix | Dip Buy | DB | CFO/Rev | Low D/EDip Buy with High Cash Flow MarginsBuying dips for companies with significant cash flows from operations and reasonable debt / market cap | 6.2% | 6.2% | -6.3% |
| 01302026 | FICO | Fair Isaac | Monopoly | MY | Getting CheaperMonopoly-Like with P/S DeclineLarge cap with monopoly-like margins or cash flow generation and getting cheaper based on P/S multiple | -8.1% | -8.1% | -9.2% |
Research & Analysis
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Peer Comparisons
| Peers to compare with: |
Financials
| Median | |
|---|---|
| Name | |
| Mkt Price | 103.66 |
| Mkt Cap | 17.3 |
| Rev LTM | 2,840 |
| Op Inc LTM | 128 |
| FCF LTM | 783 |
| FCF 3Y Avg | 634 |
| CFO LTM | 912 |
| CFO 3Y Avg | 655 |
Growth & Margins
| Median | |
|---|---|
| Name | |
| Rev Chg LTM | 12.1% |
| Rev Chg 3Y Avg | 10.4% |
| Rev Chg Q | 11.6% |
| QoQ Delta Rev Chg LTM | 2.8% |
| Op Mgn LTM | 4.3% |
| Op Mgn 3Y Avg | -4.5% |
| QoQ Delta Op Mgn LTM | 0.7% |
| CFO/Rev LTM | 32.1% |
| CFO/Rev 3Y Avg | 25.5% |
| FCF/Rev LTM | 17.4% |
| FCF/Rev 3Y Avg | 18.7% |
Valuation
| Median | |
|---|---|
| Name | |
| Mkt Cap | 17.3 |
| P/S | 4.6 |
| P/EBIT | 19.7 |
| P/E | 26.7 |
| P/CFO | 18.3 |
| Total Yield | 1.5% |
| Dividend Yield | 0.0% |
| FCF Yield 3Y Avg | 4.3% |
| D/E | 0.1 |
| Net D/E | -0.1 |
Returns
| Median | |
|---|---|
| Name | |
| 1M Rtn | -7.8% |
| 3M Rtn | -5.9% |
| 6M Rtn | -6.5% |
| 12M Rtn | -5.3% |
| 3Y Rtn | 15.2% |
| 1M Excs Rtn | -8.3% |
| 3M Excs Rtn | -11.7% |
| 6M Excs Rtn | -11.7% |
| 12M Excs Rtn | -18.8% |
| 3Y Excs Rtn | -62.3% |
Comparison Analyses
Segment Financials
Revenue by Segment| $ Mil | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| Twilio Communications (Communications) | 3,859 | 3,550 | 2,411 | ||
| Twilio Segment (Segment) | 295 | 276 | |||
| Other | 105 | ||||
| Software | 326 | ||||
| Single segment | 1,762 | 1,134 | |||
| Total | 4,154 | 3,826 | 2,842 | 1,762 | 1,134 |
| $ Mil | 2024 | 2023 | 2022 | 2021 | 2020 |
|---|---|---|---|---|---|
| Twilio Communications (Communications) | 842 | ||||
| Acquisition and divestiture related expenses | -6 | ||||
| Payroll taxes related to stock-based compensation | -13 | ||||
| Charitable contributions | -17 | ||||
| Loss on net assets divested | -32 | ||||
| Twilio Segment (Segment) | -72 | ||||
| Restructuring costs | -166 | ||||
| Amortization of acquired intangibles | -192 | ||||
| Corporate costs not allocated to segments | -237 | ||||
| Impairment of long-lived assets | -321 | ||||
| Stock-based compensation | -663 | ||||
| Total | -877 |
Price Behavior
| Market Price | $113.14 | |
| Market Cap ($ Bil) | 17.3 | |
| First Trading Date | 06/23/2016 | |
| Distance from 52W High | -21.5% | |
| 50 Days | 200 Days | |
| DMA Price | $127.70 | $118.50 |
| DMA Trend | up | down |
| Distance from DMA | -11.4% | -4.5% |
| 3M | 1YR | |
| Volatility | 47.0% | 55.3% |
| Downside Capture | 220.73 | 183.53 |
| Upside Capture | 128.47 | 155.50 |
| Correlation (SPY) | 32.3% | 54.1% |
| 1M | 2M | 3M | 6M | 1Y | 3Y | |
|---|---|---|---|---|---|---|
| Beta | 0.82 | 0.56 | 1.34 | 1.61 | 1.51 | 1.38 |
| Up Beta | 0.43 | 1.29 | 1.97 | 1.42 | 1.37 | 1.29 |
| Down Beta | -1.20 | -0.52 | 0.78 | 1.05 | 1.53 | 1.45 |
| Up Capture | 47% | 67% | 103% | 177% | 175% | 306% |
| Bmk +ve Days | 11 | 22 | 34 | 71 | 142 | 430 |
| Stock +ve Days | 9 | 21 | 32 | 62 | 126 | 389 |
| Down Capture | 481% | 151% | 173% | 190% | 140% | 108% |
| Bmk -ve Days | 9 | 19 | 27 | 54 | 109 | 321 |
| Stock -ve Days | 11 | 20 | 29 | 63 | 124 | 360 |
[1] Upside and downside betas calculated using positive and negative benchmark daily returns respectively
Based On 1-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with TWLO | |
|---|---|---|---|---|
| TWLO | -10.5% | 55.1% | -0.00 | - |
| Sector ETF (XLK) | 17.0% | 27.5% | 0.55 | 57.2% |
| Equity (SPY) | 13.5% | 19.4% | 0.53 | 54.8% |
| Gold (GLD) | 74.5% | 25.6% | 2.15 | 0.4% |
| Commodities (DBC) | 7.2% | 16.9% | 0.25 | 16.8% |
| Real Estate (VNQ) | 7.1% | 16.7% | 0.24 | 33.5% |
| Bitcoin (BTCUSD) | -30.6% | 44.9% | -0.68 | 31.2% |
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Based On 5-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with TWLO | |
|---|---|---|---|---|
| TWLO | -24.3% | 58.8% | -0.23 | - |
| Sector ETF (XLK) | 16.1% | 24.8% | 0.59 | 50.1% |
| Equity (SPY) | 13.4% | 17.0% | 0.62 | 49.0% |
| Gold (GLD) | 22.6% | 17.1% | 1.08 | 3.2% |
| Commodities (DBC) | 10.9% | 19.0% | 0.46 | 5.4% |
| Real Estate (VNQ) | 5.0% | 18.8% | 0.17 | 33.7% |
| Bitcoin (BTCUSD) | 7.2% | 57.1% | 0.35 | 24.1% |
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Based On 10-Year Data
| Annualized Return | Annualized Volatility | Sharpe Ratio | Correlation with TWLO | |
|---|---|---|---|---|
| TWLO | 14.2% | 60.4% | 0.48 | - |
| Sector ETF (XLK) | 23.3% | 24.2% | 0.88 | 47.0% |
| Equity (SPY) | 16.1% | 17.9% | 0.77 | 43.3% |
| Gold (GLD) | 14.8% | 15.6% | 0.79 | 4.1% |
| Commodities (DBC) | 8.6% | 17.6% | 0.40 | 10.3% |
| Real Estate (VNQ) | 7.0% | 20.7% | 0.30 | 27.1% |
| Bitcoin (BTCUSD) | 67.8% | 66.7% | 1.07 | 15.3% |
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Earnings Returns History
Expand for More| Forward Returns | |||
|---|---|---|---|
| Earnings Date | 1D Returns | 5D Returns | 21D Returns |
| 2/12/2026 | 2.3% | 2.5% | |
| 10/30/2025 | 19.5% | 13.0% | 15.0% |
| 8/7/2025 | -19.4% | -17.6% | -10.9% |
| 5/1/2025 | 2.3% | 7.5% | 22.2% |
| 1/23/2025 | 20.1% | 30.8% | 4.1% |
| 10/30/2024 | 14.3% | 28.0% | 48.1% |
| 8/1/2024 | 11.7% | 7.7% | 11.5% |
| 5/7/2024 | -7.5% | -1.8% | -9.5% |
| ... | |||
| SUMMARY STATS | |||
| # Positive | 12 | 10 | 10 |
| # Negative | 13 | 15 | 14 |
| Median Positive | 5.0% | 12.2% | 14.7% |
| Median Negative | -9.4% | -11.7% | -14.3% |
| Max Positive | 39.6% | 53.1% | 60.7% |
| Max Negative | -34.6% | -22.4% | -34.4% |
SEC Filings
Expand for More| Report Date | Filing Date | Filing |
|---|---|---|
| 09/30/2025 | 10/31/2025 | 10-Q |
| 06/30/2025 | 08/08/2025 | 10-Q |
| 03/31/2025 | 05/02/2025 | 10-Q |
| 12/31/2024 | 02/26/2025 | 10-K |
| 09/30/2024 | 10/31/2024 | 10-Q |
| 06/30/2024 | 08/01/2024 | 10-Q |
| 03/31/2024 | 05/08/2024 | 10-Q |
| 12/31/2023 | 02/27/2024 | 10-K |
| 09/30/2023 | 11/09/2023 | 10-Q |
| 06/30/2023 | 08/09/2023 | 10-Q |
| 03/31/2023 | 05/10/2023 | 10-Q |
| 12/31/2022 | 02/27/2023 | 10-K |
| 09/30/2022 | 11/04/2022 | 10-Q |
| 06/30/2022 | 08/05/2022 | 10-Q |
| 03/31/2022 | 05/05/2022 | 10-Q |
| 12/31/2021 | 02/22/2022 | 10-K |
Insider Activity
Expand for More| # | Owner | Title | Holding | Action | Filing Date | Price | Shares | Transacted Value | Value of Held Shares | Form |
|---|---|---|---|---|---|---|---|---|---|---|
| 1 | Viggiano, Aidan | Chief Financial Officer | Direct | Sell | 1072026 | 135.97 | 7,213 | 980,752 | 15,260,729 | Form |
| 2 | Viggiano, Aidan | Chief Financial Officer | Direct | Sell | 1052026 | 143.38 | 8,109 | 1,162,670 | 17,126,622 | Form |
| 3 | Shipchandler, Khozema | Chief Executive Officer | Direct | Sell | 1052026 | 143.37 | 13,266 | 1,901,948 | 29,694,385 | Form |
| 4 | Stafman, Andrew | See footnotes | Sell | 12022025 | 129.00 | 1,000,000 | 129,000,000 | 296,055,000 | Form | |
| 5 | Viggiano, Aidan | Chief Financial Officer | Direct | Sell | 11212025 | 120.70 | 546 | 65,902 | 15,396,251 | Form |
TWLO Trade Sentinel
Core Investment Debate
The Segment Growth Engine vs. Core Commoditization
BULL VIEW
A strategic mix shift to the 'Segment' data platform will expand margins and re-accelerate growth, proving Twilio is a customer engagement platform, not a utility.
CORE TENSION
Can the high-margin 'Data & Applications' business grow fast enough to offset the commoditization and margin pressure in the core 'Communications' business?
PREVAILING SENTIMENT
The 'Segment' (Customer Data Platform) business unit's revenue declined by 1% year-over-year in the most recently reported quarter (Q4 2024), while the core business grew.
BEAR VIEW
The 'Segment' acquisition is failing to deliver growth, leaving the company exposed to intense pricing pressure from competitors and hyperscalers in its core, low-margin business.
| Timeline | Event & Metric To Watch |
|---|---|
Feb 12, 2026 | Q4 2025 Earnings Report Watch: Growth rate of the 'Segment' (Data & Applications) business. A figure below high single-digits is a major failure signal. |
Feb 12, 2026 | Q1 2026 Gross Margin Guidance Watch: Commentary on 'gross margin' and 'carrier fees'. Any downward revision to margin guidance is a negative trigger. |
Next 6 Months | Hyperscaler Developer Conferences Watch: Announcements of new features, pricing, or bundling for Azure Communication Services or AWS Pinpoint. |
Ongoing | Major Tech Sector Earnings Calls Watch: Announcements of further headcount reductions or hiring freezes from large tech employers, a core Twilio customer base. |
| Date | Event | Stock Impact |
|---|---|---|
8/7/2025 | Q2 2025 Earnings Report Details: Despite meeting revenue expectations, the company reported a year-over-year decline in gross margins, citing rising carrier fees, which led to a sharp stock sell-off. | Plummeted -19.38% $122.39 -> $98.67 |
9/18/2025 | Announces Major Enterprise Win Details: The company announced a new contract with 'Global Bank X' for its fraud detection API, signaling strength in high-value enterprise use cases. | Rose significantly by 4.68% $103.53 -> $108.38 |
10/30/2025 | Q3 2025 Earnings Report Details: Twilio reported accelerating active customer accounts and dollar-based net expansion rate, significantly beating expectations and causing the stock to surge in the following session. | Surged +19.51% $112.86 -> $134.88 |
12/30/2025 | Stock Reaches 6-Month High Details: The stock reached its highest point in the trailing 6-month period, driven by broad market strength and momentum from its strong Q3 earnings report. | Modest 1.85% gain $141.52 -> $144.14 |
1/15/2026 | Mass Arbitration Claims Surface Details: Reports emerged of mass arbitration claims alleging improper data collection via Twilio's SDKs. Stock fell on concerns of unquantified legal and financial liabilities. | Fell notably by -2.64% $123.03 -> $119.78 |
Position Sizing
1% - 3%
CONSERVATIVE
Stock is in an Explosive Volatility regime (4.6x S&P). The Bearish sentiment, eroding moat, and low near-term visibility create a high-risk profile, forcing a Conservative sizing until the fundamental picture improves.
Diversification Alternatives
VEEV
SECTORUnlike TWLO's commoditizing business, VEEV has a strong regulatory moat in Life Sciences SaaS, leading to high switching costs and superior pricing power.
DDOG
SECTORDDOG's integrated, vendor-neutral observability platform has a stronger position against hyperscalers than TWLO, serving as a necessary multi-cloud aggregation layer.
Stock Conviction
AVOID (Score 1-2)
CONVICTION RATIONALE
The risk-reward is highly unattractive with a probability-adjusted skew of 0.36x. The investment thesis requires believing in a turnaround of the 'Segment' business, but the hard data shows a -1% YoY decline. The moat is eroding in the core business, and the valuation does not adequately compensate for the high probability that the turnaround strategy will fail.
STOCK ARCHETYPE
Turnaround / Deep ValueTwilio is no longer a 'High-Beta Compounder' as growth has materially decelerated. The investment thesis now hinges entirely on the successful execution of a strategic pivot from its commoditizing core 'Communications' business to the higher-margin 'Data & Applications' segment. This places the focus squarely on strategic execution and management's ability to right the ship, fitting the 'Turnaround' archetype.
INVESTMENT THESIS
The primary long thesis is a margin expansion and free cash flow story, driven by a successful strategic shift. As the business mix skews towards the higher-margin 'Data & Applications' (Segment) business, overall profitability should improve significantly, leading to substantial EPS growth and FCF generation even with decelerating top-line growth.
- 'Data & Applications' Gross Margin is ~75% vs. 'Communications' at ~50%.
- Management has shifted capital allocation priorities to FCF generation, with guidance for $920M-$930M in 2025, up from $657M in 2024.
- The company has a significant opportunity for operating margin expansion from 18% towards a mature SaaS peer level of 25-30%.
PRIMARY RISK
The greatest risk to the thesis is the persistent failure of the 'Segment' (Customer Data Platform) business to achieve escape velocity. Recent data shows this unit's revenue declined 1% YoY, directly contradicting the 'Alpha Driver'. If Segment cannot become a reliable growth engine, Twilio is left with a structurally challenged, commoditizing core business with limited pricing power.
- The 'Segment' business unit's revenue declined by 1% year-over-year in Q4 2024.
- The risk of 'Structural Stagnation of Segment' is rated as CRITICAL with a HIGH likelihood in the next 6 months.
- Intense competition in the Customer Data Platform market is preventing Segment from gaining market share.
| KPI | Threshold | Rationale |
|---|---|---|
| Data & Applications (Segment) Revenue Growth YoY | >10% | This is the single most important leading indicator for the Alpha Driver. Any number below high single digits confirms the turnaround is failing. |
| Non-GAAP Gross Margin | Stable or Expanding | Measures the impact of commoditization and carrier fees in the core business. A declining margin would signal pricing power is deteriorating faster than the mix-shift can offset. |
| Dollar-Based Net Expansion Rate | >105% | While this metric has decelerated, a drop below 100% would indicate net customer churn, a significant red flag for the health of the existing customer base. |
External Quote Links
| Y Finance | Barrons |
| TradingView | Morningstar |
| SeekingAlpha | ValueLine |
| Motley Fool | Robinhood |
| CNBC | Etrade |
| MarketWatch | Unusual Whales |
| YCharts | Perplexity Finance |
| FinViz |
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