Shares of Twilio Inc. (NYSE: TWLO) tumbled 7% in after-hours trading on Thursday following the company’s release of its fourth-quarter results and its disappointing guidance for the first quarter of 2025.
Fourth-Quarter Results
For the three-month period ending December 31, Twilio reported adjusted earnings per share (EPS) of $1.00 on $1.19 billion in revenue. This matched analysts’ expectations, who had forecasted an EPS of $1.00 and $1.17 billion in revenue, according to a survey by Investing.com.
While the company met EPS expectations, investors were cautious due to the outlook for the coming quarter.
Disappointing Guidance for Q1 2025
Looking ahead, Twilio provided a Q1 2025 adjusted EPS guidance of $0.88 to $0.93, which was below analyst estimates of $0.98. Additionally, the company forecasted revenue in the range of $1.13 billion to $1.14 billion, also missing the consensus estimate of $1.14 billion.
Outlook for Full Year 2025
For 2025, Twilio projected non-GAAP income from operations between $825 million and $850 million. The forecast for the year signals some growth, but given the softer Q1 outlook, investors appeared uncertain about the company’s ability to meet these expectations.
Investor Reaction
The guidance shortfall and the general market sentiment led to a notable decline in Twilio’s stock price during after-hours trading. The company’s strong results for Q4 were overshadowed by concerns over slower-than-expected growth in the coming quarters.
Conclusion
While Twilio’s fourth-quarter earnings were in line with expectations, the weak first-quarter guidance and softened outlook for 2025 prompted investor caution. As a result, the stock faced significant downward pressure, highlighting the ongoing challenges in meeting growth targets in an increasingly competitive environment.
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