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Twilio (TWLO) Surpasses Q2 Earnings and Revenue Estimates
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Twilio (TWLO - Free Report) reported better-than-expected results for the second quarter of 2023, wherein non-GAAP earnings of 54 cents per share surpassed the Zacks Consensus Estimate of 29 cents. In the year-ago quarter the company incurred a loss of 11 cents. The year-over-year rise in non-GAAP earnings was primarily due to higher revenues and cost savings through headcount reductions.
Revenue Details
The cloud-based communications platform-as-a-service provider registered revenues of $1.04 billion. The figure improved by 10% year over year and outshined the consensus mark of $984.5 million.
TWLO has been benefiting from constant expansion of its international business and continuous acceleration of digital transformation projects across several industries. The top line was primarily driven by the enhancement of customer experiences across various product portfolios like Segment, Flex and Engage. These are its fastest-growing software-as-a-service products at present.
Twilio’s dollar-based net expansion rate was 103% in the reported quarter, down from 106% in the previous quarter and 123% in the year-ago quarter. The Zacks Consensus Estimate was pegged at 101%.
Active customer accounts increased to 304,000 as of Jun 30, 2023, from 300,000 at the end of first-quarter 2023. The figure was 275,000 as of Jun 30, 2022. The consensus mark stood at 306,350 for the reported quarter.
Operating Results
Non-GAAP gross profit climbed 12.7% year over year to $541.9 million. Non-GAAP gross margin expanded 100 basis points to 52%.
Non-GAAP operating income was $120.1 million against the year-ago quarter’s non-GAAP operating loss of $7.3 million. Non-GAAP operating margin was 12%, up from 1% in the prior-year quarter.
General & administrative expenses on a non-GAAP basis decreased 16.7% to $73 million and accounted for 7% of quarterly revenues. Research & development expenditures on a non-GAAP basis dipped 9.9% year over year to $150.6 million and made up 15% of quarterly revenues.
Non-GAAP sales & marketing costs declined 15.1% to $198.1 million. The same represented 19% of second-quarter revenues.
Balance Sheet
The company exited the June quarter with cash and cash equivalents, and short-term marketable securities of $3.68 billion, down from $3.95 billion at first-quarter 2023 end. As of Jun 30, 2023, TWLO’s long-term debt was $988.2 million.
During the first six months of 2023, Twilio used $14.2 million worth cash for operating activities.
Q3 Guidance
For the current quarter ending Sep 30, 2023, the company anticipates revenues to be between $980 million and $990 million, flat to up 1%. Twilio forecast non-GAAP earnings in the range of 33-37 cents per share. Management estimates non-GAAP income from operations in the $75-$85 million band.
Zacks Rank
Currently, Twilio carries a Zacks Rank #2 (Buy). Shares of TWLO have lost 28.1% over the past year.
The Zacks Consensus Estimate for NVIDIA’s second-quarter fiscal 2024 earnings has been steady at 92 cents per share over the past 90 days. For fiscal 2024, earnings estimates have moved up by 13 cents to $7.79 in the past 30 days.
NVDA's earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 0.26%. The stock has soared 205.6% in the past year.
The Zacks Consensus Estimate for Salesforce’s second-quarter fiscal 2024 earnings has been revised southward by a penny to $1.60 per share over the past 60 days. For fiscal 2024, earnings estimates have moved up by 4 cents to $7.44 in the past 60 days.
CRM's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.5%. The stock has gained 59.6% in the past year.
The Zacks Consensus Estimate for Meta Platforms' third-quarter 2023 earnings has been revised upward by 15.1% to $3.44 per share over the past seven days. For 2023, earnings estimates have moved north by 7.9% to $12.94 in the same time frame.
META’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, missing once, the average beat being 19%. The stock has surged 159.8% in the past year.
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Twilio (TWLO) Surpasses Q2 Earnings and Revenue Estimates
Twilio (TWLO - Free Report) reported better-than-expected results for the second quarter of 2023, wherein non-GAAP earnings of 54 cents per share surpassed the Zacks Consensus Estimate of 29 cents. In the year-ago quarter the company incurred a loss of 11 cents. The year-over-year rise in non-GAAP earnings was primarily due to higher revenues and cost savings through headcount reductions.
Revenue Details
The cloud-based communications platform-as-a-service provider registered revenues of $1.04 billion. The figure improved by 10% year over year and outshined the consensus mark of $984.5 million.
TWLO has been benefiting from constant expansion of its international business and continuous acceleration of digital transformation projects across several industries. The top line was primarily driven by the enhancement of customer experiences across various product portfolios like Segment, Flex and Engage. These are its fastest-growing software-as-a-service products at present.
Twilio’s dollar-based net expansion rate was 103% in the reported quarter, down from 106% in the previous quarter and 123% in the year-ago quarter. The Zacks Consensus Estimate was pegged at 101%.
Twilio Inc. Price, Consensus and EPS Surprise
Twilio Inc. price-consensus-eps-surprise-chart | Twilio Inc. Quote
Active customer accounts increased to 304,000 as of Jun 30, 2023, from 300,000 at the end of first-quarter 2023. The figure was 275,000 as of Jun 30, 2022. The consensus mark stood at 306,350 for the reported quarter.
Operating Results
Non-GAAP gross profit climbed 12.7% year over year to $541.9 million. Non-GAAP gross margin expanded 100 basis points to 52%.
Non-GAAP operating income was $120.1 million against the year-ago quarter’s non-GAAP operating loss of $7.3 million. Non-GAAP operating margin was 12%, up from 1% in the prior-year quarter.
General & administrative expenses on a non-GAAP basis decreased 16.7% to $73 million and accounted for 7% of quarterly revenues. Research & development expenditures on a non-GAAP basis dipped 9.9% year over year to $150.6 million and made up 15% of quarterly revenues.
Non-GAAP sales & marketing costs declined 15.1% to $198.1 million. The same represented 19% of second-quarter revenues.
Balance Sheet
The company exited the June quarter with cash and cash equivalents, and short-term marketable securities of $3.68 billion, down from $3.95 billion at first-quarter 2023 end. As of Jun 30, 2023, TWLO’s long-term debt was $988.2 million.
During the first six months of 2023, Twilio used $14.2 million worth cash for operating activities.
Q3 Guidance
For the current quarter ending Sep 30, 2023, the company anticipates revenues to be between $980 million and $990 million, flat to up 1%. Twilio forecast non-GAAP earnings in the range of 33-37 cents per share. Management estimates non-GAAP income from operations in the $75-$85 million band.
Zacks Rank
Currently, Twilio carries a Zacks Rank #2 (Buy). Shares of TWLO have lost 28.1% over the past year.
Other Key Picks
Some other top-ranked stocks from the broader Computer and Technology sector are NVIDIA Corporation (NVDA - Free Report) , Salesforce (CRM - Free Report) and Meta Platforms (META - Free Report) . While NVIDIA sports a Zacks Rank #1 (Strong Buy), Salesforce and Meta carry a Zacks Rank #2 each at present. You can see the complete list of today's Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for NVIDIA’s second-quarter fiscal 2024 earnings has been steady at 92 cents per share over the past 90 days. For fiscal 2024, earnings estimates have moved up by 13 cents to $7.79 in the past 30 days.
NVDA's earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, missing twice, the average surprise being 0.26%. The stock has soared 205.6% in the past year.
The Zacks Consensus Estimate for Salesforce’s second-quarter fiscal 2024 earnings has been revised southward by a penny to $1.60 per share over the past 60 days. For fiscal 2024, earnings estimates have moved up by 4 cents to $7.44 in the past 60 days.
CRM's earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 15.5%. The stock has gained 59.6% in the past year.
The Zacks Consensus Estimate for Meta Platforms' third-quarter 2023 earnings has been revised upward by 15.1% to $3.44 per share over the past seven days. For 2023, earnings estimates have moved north by 7.9% to $12.94 in the same time frame.
META’s earnings beat the Zacks Consensus Estimate in three of the trailing four quarters, missing once, the average beat being 19%. The stock has surged 159.8% in the past year.