First Impressions Of Twilio's Strong Q4 And Mixed Outlook

Twilio Inc TWLO reported robust Q4 results, with total revenue rising 60 percent to $82 million, beating the consensus by $7.8 million.

William Blair’s Bhavan Suri maintains an Outperform rating on the company.

Robust Q4

Twilio reported its non-GAAP operating income for Q4 at $0.1 million, well ahead of the consensus expectations of non-GAAP operating loss of $4.7 million.

In addition, base revenue grew 73 percent to $75.2 million, meaningfully beating the consensus forecast of $69 million and the estimate of $68.5 million.

The dollar-based net expansion rate came in at 155 percent, unchanged from the previous quarter.

Mixed Guidance

Management guided to full-year revenue for 2017 at $364 million to $372 million, implying 31–34 percent growth, and again well ahead of the consensus expectation.

Twilio expects its non-GAAP operating loss at $13 million to $17 million for 2017, which was below the consensus forecast.

The analyst believes “some of the investments the company had planned to make in 2016 were possibly pushed into 2017, hence the materially better-than-expected non-GAAP operating margins in 2016, and the lower-than-expected outlook for 2017.”

For Q1:17, Twilio guided to revenue of $82 million to $84 million, implying 38-42 percent growth and beating the consensus forecast.

The non-GAAP operating loss for the quarter is expected at 5.5 million and $6.5 million, representing a 7 percent decline at the midpoint and below the consensus expectations.

At last check in Wednesday's pre-market session, shares of Twilio were up 2.87 percent at $31.85.