Twilio (TWLO) is set to announce third quarter earnings on Thursday and investors expect gains on the back of momentum in large deals, growth optionality in international expansion and expansion of AI tools, including AI Voice.
Wall Street expects the software company to post EPS of $1.07, implying a 4.9% increase, while revenue is expected to jump 10.6% to $1.25 billion during the quarter.
For the third quarter, Twilio expects revenue of $1.245 billion to $1.255 billion, representing 8% to 9% organic growth and 10% to 11% reported growth, while adjusted EPS to range from $1.01 to $1.06.
J.P. Morgan reiterated its Overweight rating for TWLO, with a price target of $140, saying that optionality exists for Twilio to continue to expand its business internationally.
“Additionally, Twilio is gearing its sales force to pursue business with a greater number of enterprise customers such as PayPal, ING, and Nike, which could increase Twilio’s stickiness through enterprise-level retention rates,” highlighted J.P. Morgan analyst Mark Murphy.
Earlier this month, Wells Fargo initiated coverage of Twilio (TWLO) with an Overweight rating and a $130 price target, saying that it is a well-positioned provider of infrastructure for the growing market of voice artificial intelligence applications.
Seeking Alpha’s Quant Rating rated the company as a Hold, while Seeking Alpha analysts and Wall Street analysts recommended the stock as a Buy.
Seeking Alpha analyst Amrita Roy reiterated Buy rating for TWLO, with an updated price target of $160, arguing that, “momentum in large deals, AI-driven products, and cross-selling support the bullish investment thesis for Twilio.”
Over the last two years, TWLO has beaten EPS estimates 88% of the time and has beaten revenue estimates 100% of the time.
Over the last three months, EPS estimates have seen one upward revision against 22 downward moves, while revenue estimates have seen 23 upward revisions versus no downward revisions.
Shares of Twilio (TWLO) gained over 4% so far this year, compared to nearly 17.5% increase in the broader benchmark index.