T.D. Cowen upgraded Twilio (TWLO) to Buy from Hold due in part to its integral role as an enabler in artificial intelligence-driven business-to-consumer engagements.
The financial firm also increased its price target to $160 from $125.
Twilio shares were up 3.5% by noon trading on Monday.
“In the current wake of software disruption fears, TWLO offers a refreshing position: 1) infrastructure software, built on physical telephony, with scale & reliability that is defensible to new entrants (akin to hyperscalers); 2) consumption pricing, with virtually no risk of secular seat compression or stack displacement from AI; and 3) an effective return to its roots to a low-touch GTM model with high CAC efficiencies,” said T.D. Cowen analysts, led by Derrick Wood, in a Monday investor report.
T.D. Cowen highlighted that the rapid rise of AI agents should drive up consumption on Twilio’s platform across messaging, voice, email, and other channels.
“While TWLO has seen strong growth from Voice AI start-ups (revs up >60% in 4Q), enterprises (its biggest cohort) have lagged,” Wood noted. “Our industry checks, however, suggest enterprises are progressing through experimentation phases & that 2H26 could be the time when adoption starts to inflect, which would be a bigger force in TWLO’s Voice growth.”