Outperforming Expectations
The clouds parted for Twilio Inc. as its shares soared 6.7% in Thursday’s extended trading, driven by second-quarter 2024 results that outperformed expectations. With non-GAAP earnings of 87 cents per share, Twilio surpassed the Zacks Consensus Estimate of 71 cents, showcasing a marked improvement from the year before.
Revenue Surge
Twilio’s revenue for the second quarter stood at a commendable $1.08 billion, outshining the Zacks Consensus Estimate of $1.06 billion. Year over year, revenues surged by 4%, bolstered by a robust organic growth of 7%. The Communications division’s revenues climbed to $1.01 billion, while the Segment division saw sales rise to $75.2 million.
Operating Strength
The financial backbone of Twilio remained strong, with non-GAAP gross profit increasing to $555.8 million and the gross margin expanding to 53.3%. Operating income saw a substantial 45.9% year-over-year jump, reaching $175.3 million. The company’s prudent expense management was evident with G&A and R&D costs, as well as sales & marketing costs, all showing favorable trends.
Financial Fortitude
Exiting the second quarter with $3.12 billion in cash and cash equivalents, Twilio demonstrated resilience amidst market fluctuations. The company generated solid operating and free cash flows, enabling it to repurchase $1.27 billion worth of stock in the first half of 2024.
Guidance and Outlook
Twilio raised its full-year 2024 guidance, with a revised organic revenue growth and an upward projection for non-GAAP income from operations. Looking forward, Twilio anticipates a year-over-year increase in revenues for the third quarter, which aligns with positive market expectations.
Investors should take note of Twilio’s Zacks Rank #1 (Strong Buy) status, reflecting the company’s strong performance potential despite a 25.8% YTD decline in share value.
