- Cloud communications company Twilio announced this year will be an “important investment year” as it is reporting a net loss per share
Twilio — the cloud communications company founded by Jeff Lawson, Evan Cooke, and John Wolthuis — announced its quarterly earnings. Even though Twilio’s revenue and profit topped expectations, the company said it will report a net loss per share this year. Analysts were expecting a profit for the year. Twilio CFO Khozema Shipchandler pointed out that analysts and investors should not be worried though.
“What (analysts) couldn’t have known was that 2020 will be an important investment year for us,” said Shipchandler in a phone interview with The Street while referring to the forecast net loss of 14 to 20 cents per share for 2020 (excluding some costs). Analysts were estimating a 22-cent profit per share.
Twilio is going to be spending more on back-office processes as well as sales and marketing in order to pursue “the next wave of growth that is right in front of us.”
Shipchandler pointed out “it’s always a choice, right?” And Shipchandler said that they can “choose to take money that falls to the bottom line or we can choose to reinvest it back into the business to promote growth.”
Plus Shipchandler acknowledged that Twilio has received a lot of support from investors about the company’s business decisions. The bulk of the shortfall will happen early this year.
For the quarter, Twilio reported $331.2 million in revenue — which is a 62% year-over-year jump. The analyst estimates were $312 million. This earnings report brings the company’s total annual revenue to more than $1 billion.
Last year, Twilio hired 1,400 employees. And the company reported a net loss of $2.36 a share, 16 cents a share non-GAAP earnings, and revenue of $1.13 billion — up 75% from a year ago.
The 62% increase in revenue also included earnings from SendGrid. SendGrid is a bulk email campaign service that Twilio acquired about a year ago. SendGrid’s revenue for the quarter was about $54 million. But going forward Twilio is not going to separate the earnings for SendGrid.
This quarter, Twilio’s revenue is expected to be somewhere between $335 million and $338 million. But net loss is expected to be 9 cents to 11 cents a share.
For the full year, Twilio is expecting revenue somewhere in the ballpark of $1.475 and $1.49 billion with a net loss of 14 cents to 20 cents.
