By Senad Karaahmetovic
Twilio (NYSE:TWLO) stock is trading about 15% higher in pre-open Wednesday after the company delivered a better-than-expected profit forecast.
For its fourth quarter, Twilio posted EPS of $0.22 on revenue of $1.02 billion. Analysts were expecting a loss per share of $0.08 on revenue of $1B. The company also reported a 13% increase in the number of active customer accounts to over 290,000.
“While our vision remains, the way we operate and execute has changed — all in service of driving better focus for the business and ultimately enhancing value creation for our shareholders,” said CEO Jeff Lawson.
For this quarter, Twilio guided to EPS of $0.20 on revenue of $1B, which compares to the consensus for earnings of $0.01 per share on revenue of $1.02B.
Moreover, the company said its board authorized a $1B share buyback program.
KeyBanc analysts reiterated an Overweight rating and raised the price target by $12 to $89 per share.
“We continue to view TC and TD&A as complementary and as driving an increased value proposition, together adding to the probability of success in executing on increasing Twilio to a higher-gross-margin, and now much higher operating margin, customer engagement platform solutions provider over the MT,” they wrote in a note.
Bernstein analysts said shares are trading higher on the strong profit forecast.
“But like strategy day, and earlier quarters, much of this is on the come (with promises as far out as 2027 - when they anticipate reaching GAAP profitability). Perhaps the one difference? They've now demonstrated some of the actions that will start turning the tide on OpM, including in aggregate laying off more than 25% of their workforce,” the analysts said.