Twilio’s first quarter was marked by strong acceleration in both revenue and profitability, with management attributing the outperformance to broad-based demand for its communications platform, particularly in voice and messaging products. CEO Khozema Shipchandler highlighted that AI-driven use cases are increasingly becoming a major entry point for customers, with voice channel revenue growing for a sixth consecutive quarter. The company also pointed to increased adoption of software add-ons like branded calling and conversational intelligence, which showed more than 100% year-over-year growth, and noted success in onboarding multiproduct customers across diverse industries.
Is now the time to buy TWLO? Find out in our full research report (it’s free for active Edge members).
Twilio (TWLO) Q1 CY2026 Highlights:
- Revenue: $1.41 billion vs analyst estimates of $1.34 billion (20% year-on-year growth, 4.7% beat)
- Adjusted EPS: $1.50 vs analyst estimates of $1.27 (18% beat)
- Adjusted Operating Income: $278.9 million vs analyst estimates of $245.7 million (19.8% margin, 13.5% beat)
- Revenue Guidance for Q2 CY2026 is $1.43 billion at the midpoint, above analyst estimates of $1.39 billion
- Adjusted EPS guidance for Q2 CY2026 is $1.30 at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: 7.7%, up from 2% in the same quarter last year
- Net Revenue Retention Rate: 114%, up from 108% in the previous quarter
- Billings: $1.41 billion at quarter end, up 20.2% year on year
- Market Capitalization: $29.05 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Twilio’s Q1 Earnings Call
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Alex Zukin (Wolfe Research) asked about the drivers of messaging and voice growth; CFO Aidan Viggiano and Chief Revenue Officer Thomas Wyatt described broad-based strength, with AI use cases and software add-ons leading to acceleration across both channels.
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Taylor McGinnis (UBS) questioned the durability of messaging growth given tougher comparisons ahead; Viggiano said RCS and AI-native volumes are early contributors but not yet meaningful, and Shipchandler stressed ongoing cross-channel expansion as a driver of future durability.
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Mark Murphy (JPMorgan) inquired about margin expansion and headcount strategy; Viggiano stated that flat headcount and embedded AI tooling costs underpin guidance, with a continued focus on operational discipline and stock-based compensation reduction.
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Derrick Wood (TD Cowen) asked about the future of Segment and its integration; Shipchandler responded that data technology will be used to enrich communications across channels, rather than focusing on Segment as a standalone product.
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Jim Fish (Piper Sandler) probed competitive positioning in the evolving AI landscape; Shipchandler emphasized Twilio’s platform neutrality and integration flexibility, while Wyatt highlighted the launch of embeddable Flex to serve customers inside CRM systems.
Catalysts in Upcoming Quarters
Looking ahead, the StockStory team will be watching (1) the rollout and customer adoption of new AI-powered platform features announced at SIGNAL, (2) continued growth in multiproduct and cross-channel usage, which should signal sustained expansion of Twilio’s ecosystem, and (3) the impact of incremental carrier fees on gross margins and the company’s ability to offset these pressures through product and pricing strategies. Progress on onboarding large enterprise deals and deepening ISV partnerships will also be key milestones.
Twilio currently trades at $193.20, up from $148.06 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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