Twilio Announces First Quarter 2022 Results
Twilio (TWLO) reported strong Q1 2022 results, achieving $875.4 million in revenue, a 48% increase year-over-year. The Dollar-Based Net Expansion Rate was 127%, down from 133% in Q1 2021. Despite the revenue growth, the company faced a GAAP loss from operations of $217.8 million compared to $197.3 million in the previous year. Non-GAAP income decreased from $17.3 million in Q1 2021 to $5 million. Twilio announced Elena Donio as the new President of Revenue, effective May 4, 2022, as the company aims to enhance its go-to-market strategy.
- Q1 2022 revenue increased to $875.4 million, up 48% year-over-year.
- Active customer accounts grew to 268,000 from 235,000 year-over-year.
- Dollar-Based Net Expansion Rate remains strong at 127%.
- GAAP loss from operations increased to $217.8 million from $197.3 million year-over-year.
- Non-GAAP income from operations declined to $5 million from $17.3 million in Q1 2021.
- Net loss per share was $1.23 compared to $1.24 in the previous year.
-
First Quarter Revenue of
, up$875.4 million 48% Year-Over-Year
-
First Quarter Revenue Dollar-Based Net Expansion Rate of
127%
“We carried our momentum into 2022 and delivered another strong quarter to start the year, with first quarter revenue coming in at
First Quarter 2022 Financial Highlights
-
Revenue of
for the first quarter of 2022, up$875.4 million 48% year-over-year, including from Zipwhip. Organic revenue1 grew$32.2 million 35% year-over-year.
-
GAAP loss from operations of
for the first quarter of 2022, compared with GAAP loss from operations of$217.8 million for the first quarter of 2021.$197.3 million
-
Non-GAAP income from operations of
for the first quarter of 2022 compared with non-GAAP income from operations of$5.0 million for the first quarter of 2021.$17.3 million
-
GAAP net loss per share attributable to common stockholders, basic and diluted, of
based on 180.9 million weighted average shares outstanding in the first quarter of 2022, compared with GAAP net loss per share attributable to common stockholders, basic and diluted, of$1.23 based on 167.2 million weighted average shares outstanding in the first quarter of 2021.$1.24
-
Non-GAAP net income per share attributable to common stockholders, diluted, of
based on 184.5 million non-GAAP weighted average shares outstanding in the first quarter of 2022, compared with non-GAAP net income per share attributable to common stockholders, diluted, of$0.00 based on 180.6 million non-GAAP weighted average shares outstanding in the first quarter of 2021.$0.05
Key Metrics
-
268,000 Active Customer Accounts as of
March 31, 2022 , compared to 235,000 Active Customer Accounts as ofMarch 31, 2021 .
-
Dollar-Based Net Expansion Rate was
127% for the first quarter of 2022, compared to133% for the first quarter of 2021. Results from acquisitions closed afterJanuary 1, 2021 , including Zipwhip, do not impact the calculation of this metric in either period.
-
8,199 employees as of
March 31, 2022 .
Executive Leadership Update
The Company also announced that effective
Outlook
|
|
Q2 FY22
|
|
Revenue (millions) |
|
|
|
Y/Y Growth |
|
|
|
Organic Y/Y Growth2 |
|
|
|
Non-GAAP loss from operations (millions) |
|
( |
|
Non-GAAP loss per share |
|
( |
|
Non-GAAP basic shares outstanding (millions) |
|
182 |
|
|
Conference Call Information
About
Today’s leading companies trust Twilio’s Customer Engagement Platform (CEP) to build direct, personalized relationships with their customers everywhere in the world. Twilio’s leading communications APIs enable companies to engage with their customers across voice, conversations, messaging, video and email. Twilio Segment, the leading Customer Data Platform, allows companies to create highly personalized interactions and automated customer profiles based on first-party data from multiple channels.
Forward-Looking Statements
This press release and the accompanying conference call contain forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events or our future financial or operating performance. In some cases, you can identify forward-looking statements because they contain words such as “may,” “can,” “will,” “would,” “should,” “expects,” “plans,” “anticipates,” “could,” “intends,” “target,” “projects,” “contemplates,” “believes,” “estimates,” “predicts,” “forecasts,” “potential” or “continue” or the negative of these words or other similar terms or expressions that concern our expectations, strategy, plans or intentions. Forward-looking statements contained in this press release include, but are not limited to, statements about: Twilio’s outlook for the quarter ending
The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties, and other factors that may cause Twilio’s actual results, performance, or achievements to differ materially from those described in the forward-looking statements, including, among other things: adverse changes in general economic or market conditions, including labor shortages, supply chain disruptions and inflation; changes in the market for communications; the impact of COVID-19 on
The forward-looking statements contained in this press release are also subject to additional risks, uncertainties, and factors, including those more fully described in Twilio’s most recent filings with the
Forward-looking statements represent Twilio’s management’s beliefs and assumptions only as of the date such statements are made.
Use of Non-GAAP Financial Measures
To provide investors and others with additional information regarding Twilio’s results, the following non-GAAP financial measures are disclosed:
Non‑GAAP Gross Profit and Non‑GAAP Gross Margin. For the periods presented,
Non‑GAAP Operating Expenses. For the periods presented,
Non‑GAAP Income (Loss) from Operations and Non‑GAAP Operating Margin. For the periods presented,
Non-GAAP Tax Rate.
Non‑GAAP Net Income (Loss) Attributable to Common Stockholders and Non‑GAAP Net Income (Loss) Per Share Attributable to Common Stockholders, Basic and Diluted. For the periods presented,
Twilio’s management uses the foregoing non-GAAP financial information, collectively, to evaluate its ongoing operations and for internal planning and forecasting purposes. Twilio’s management believes that non-GAAP financial information, when taken collectively, may be helpful to investors because it provides consistency and comparability with past financial performance, facilitates period-to-period comparisons of results of operations, and assists in comparisons with other companies, many of which use similar non-GAAP financial information to supplement their GAAP results. Non‑GAAP financial information is presented for supplemental informational purposes only, should not be considered a substitute for financial information presented in accordance with generally accepted accounting principles, and may be different from similarly-titled non‑GAAP measures used by other companies. Whenever
With respect to Twilio’s guidance as provided under “Outlook” above,
Operating Metrics
Number of Active Customer Accounts.
Dollar-Based Net Expansion Rate. Twilio’s ability to drive growth and generate incremental revenue depends, in part, on the Company’s ability to maintain and grow its relationships with existing Active Customer Accounts and to increase their use of the platform. An important way in which
Source:
1Organic revenue excludes revenue from Zipwhip and all other acquisitions closed after
2Organic revenue growth guidance excludes revenue from acquisitions that closed after
|
||||||||
Condensed Consolidated Statements of Operations |
||||||||
(In thousands, except share and per share amounts) |
||||||||
(Unaudited) |
||||||||
|
|
Three Months Ended
|
||||||
|
|
|
2022 |
|
|
|
2021 |
|
Revenue |
|
$ |
875,363 |
|
|
$ |
589,988 |
|
Cost of revenue |
|
|
450,292 |
|
|
|
291,684 |
|
Gross profit |
|
|
425,071 |
|
|
|
298,304 |
|
Operating expenses: |
|
|
|
|
||||
Research and development |
|
|
240,611 |
|
|
|
174,800 |
|
Sales and marketing |
|
|
287,906 |
|
|
|
210,590 |
|
General and administrative |
|
|
114,362 |
|
|
|
110,253 |
|
Total operating expenses |
|
|
642,879 |
|
|
|
495,643 |
|
Loss from operations |
|
|
(217,808 |
) |
|
|
(197,339 |
) |
Other expenses, net |
|
|
(6,677 |
) |
|
|
(8,313 |
) |
Loss before benefit from (provision for) income taxes |
|
|
(224,485 |
) |
|
|
(205,652 |
) |
Benefit from (provision for) income taxes |
|
|
2,858 |
|
|
|
(890 |
) |
Net loss attributable to common stockholders |
|
$ |
(221,627 |
) |
|
$ |
(206,542 |
) |
|
|
|
|
|
||||
Net loss per share attributable to common stockholders, basic and diluted |
|
$ |
(1.23 |
) |
|
$ |
(1.24 |
) |
Weighted-average shares used in computing net loss per share attributable to common stockholders, basic and diluted |
|
|
180,898,713 |
|
|
|
167,160,458 |
|
|
||||||||
Condensed Consolidated Balance Sheets |
||||||||
(In thousands) |
||||||||
(Unaudited) |
||||||||
|
|
As of
|
|
As of
|
||||
|
|
|
2022 |
|
|
|
2021 |
|
ASSETS |
|
|
|
|
||||
Current assets: |
|
|
|
|
||||
Cash and cash equivalents |
|
$ |
1,617,022 |
|
|
$ |
1,479,452 |
|
Short-term marketable securities |
|
|
3,606,290 |
|
|
|
3,878,430 |
|
Accounts receivable, net |
|
|
406,736 |
|
|
|
388,215 |
|
Prepaid expenses and other current assets |
|
|
201,142 |
|
|
|
186,131 |
|
Total current assets |
|
|
5,831,190 |
|
|
|
5,932,228 |
|
Property and equipment, net |
|
|
259,003 |
|
|
|
255,316 |
|
Operating right-of-use assets |
|
|
225,951 |
|
|
|
234,584 |
|
Intangible assets, net |
|
|
1,006,692 |
|
|
|
1,050,012 |
|
|
|
|
5,286,683 |
|
|
|
5,263,166 |
|
Other long-term assets |
|
|
281,283 |
|
|
|
263,292 |
|
Total assets |
|
$ |
12,890,802 |
|
|
$ |
12,998,598 |
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
||||
Current liabilities: |
|
|
|
|
||||
Accounts payable |
|
$ |
93,389 |
|
|
$ |
93,333 |
|
Accrued expenses and other current liabilities |
|
|
433,668 |
|
|
|
417,503 |
|
Deferred revenue and customer deposits |
|
|
139,671 |
|
|
|
140,389 |
|
Operating lease liability, current |
|
|
53,094 |
|
|
|
52,325 |
|
Total current liabilities |
|
|
719,822 |
|
|
|
703,550 |
|
Operating lease liability, noncurrent |
|
|
201,354 |
|
|
|
211,253 |
|
Finance lease liability, noncurrent |
|
|
22,053 |
|
|
|
25,132 |
|
Long-term debt, net |
|
|
986,243 |
|
|
|
985,907 |
|
Other long-term liabilities |
|
|
43,897 |
|
|
|
41,290 |
|
Total liabilities |
|
|
1,973,369 |
|
|
|
1,967,132 |
|
Commitments and contingencies |
|
|
|
|
||||
Stockholders’ equity: |
|
|
|
|
||||
Preferred stock |
|
|
— |
|
|
|
— |
|
Common stock |
|
|
181 |
|
|
|
180 |
|
Additional paid-in capital |
|
|
13,343,554 |
|
|
|
13,169,118 |
|
Accumulated other comprehensive loss |
|
|
(84,984 |
) |
|
|
(18,141 |
) |
Accumulated deficit |
|
|
(2,341,318 |
) |
|
|
(2,119,691 |
) |
Total stockholders’ equity |
|
|
10,917,433 |
|
|
|
11,031,466 |
|
Total liabilities and stockholders’ equity |
|
$ |
12,890,802 |
|
|
$ |
12,998,598 |
|
|
||||||||
Condensed Consolidated Statements of Cash Flows |
||||||||
(In thousands) |
||||||||
(Unaudited) |
||||||||
|
|
Three Months Ended
|
||||||
|
|
|
2022 |
|
|
|
2021 |
|
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
||||||
Net loss |
|
$ |
(221,627 |
) |
|
$ |
(206,542 |
) |
Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |
|
|
|
|
||||
Depreciation and amortization |
|
|
68,103 |
|
|
|
59,592 |
|
Non-cash reduction to the right-of-use asset |
|
|
12,415 |
|
|
|
11,711 |
|
Net amortization of investment premium and discount |
|
|
10,712 |
|
|
|
4,240 |
|
Amortization of debt discount and issuance costs |
|
|
338 |
|
|
|
3,373 |
|
Stock-based compensation |
|
|
155,275 |
|
|
|
137,155 |
|
Amortization of deferred commissions |
|
|
12,626 |
|
|
|
5,630 |
|
Allowance for credit losses |
|
|
2,558 |
|
|
|
1,985 |
|
Value of shares of Class A common stock donated to charity |
|
|
4,232 |
|
|
|
9,405 |
|
Loss on extinguishment of debt |
|
|
— |
|
|
|
7,602 |
|
Other adjustments |
|
|
(1,478 |
) |
|
|
3,089 |
|
Changes in operating assets and liabilities: |
|
|
|
|
||||
Accounts receivable |
|
|
(19,623 |
) |
|
|
5,565 |
|
Prepaid expenses and other current assets |
|
|
(14,176 |
) |
|
|
(29,912 |
) |
Other long-term assets |
|
|
(27,399 |
) |
|
|
(15,232 |
) |
Accounts payable |
|
|
1,247 |
|
|
|
(10,275 |
) |
Accrued expenses and other current liabilities |
|
|
18,148 |
|
|
|
28,307 |
|
Deferred revenue and customer deposits |
|
|
(1,453 |
) |
|
|
3,435 |
|
Operating lease liabilities |
|
|
(13,058 |
) |
|
|
(12,053 |
) |
Other long-term liabilities |
|
|
(4,415 |
) |
|
|
(2,570 |
) |
Net cash (used in) provided by operating activities |
|
|
(17,575 |
) |
|
|
4,505 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
||||
Acquisitions, net of cash acquired and other related payments |
|
|
(27,682 |
) |
|
|
(66,926 |
) |
Purchases of marketable securities and other investments |
|
|
(246,874 |
) |
|
|
(1,640,499 |
) |
Proceeds from sales and maturities of marketable securities |
|
|
442,753 |
|
|
|
356,824 |
|
Capitalized software development costs |
|
|
(10,250 |
) |
|
|
(10,434 |
) |
Purchases of long-lived and intangible assets |
|
|
(6,980 |
) |
|
|
(4,986 |
) |
Net cash provided by (used in) investing activities |
|
|
150,967 |
|
|
|
(1,366,021 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
||||
Proceeds from public offerings, net of underwriters' discount and issuance costs |
|
|
— |
|
|
|
1,766,400 |
|
Payments of costs related to public offerings |
|
|
(35 |
) |
|
|
(360 |
) |
Proceeds from issuance of senior notes due 2029 and 2031 |
|
|
— |
|
|
|
987,500 |
|
Payment of debt issuance costs |
|
|
— |
|
|
|
(130 |
) |
Principal payments on debt and finance leases |
|
|
(6,520 |
) |
|
|
(2,751 |
) |
Value of equity awards withheld for tax liabilities |
|
|
(1,065 |
) |
|
|
(2,774 |
) |
Proceeds from exercises of stock options |
|
|
11,727 |
|
|
|
11,564 |
|
Net cash provided by financing activities |
|
|
4,107 |
|
|
|
2,759,449 |
|
Effect of exchange rate changes on cash, cash equivalents and restricted cash |
|
|
27 |
|
|
|
(44 |
) |
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH |
|
|
137,526 |
|
|
|
1,397,889 |
|
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—Beginning of period |
|
|
1,481,831 |
|
|
|
933,885 |
|
CASH, CASH EQUIVALENTS AND RESTRICTED CASH—End of period |
|
$ |
1,619,357 |
|
|
$ |
2,331,774 |
|
|
||||||||
Reconciliation to Non-GAAP Financial Measures |
||||||||
(In thousands, except shares, per share amounts and percentages) |
||||||||
(Unaudited) |
||||||||
|
|
Three Months Ended
|
||||||
|
|
|
2022 |
|
|
|
2021 |
|
Gross profit |
|
$ |
425,071 |
|
|
$ |
298,304 |
|
Gross margin |
|
|
49 |
% |
|
|
51 |
% |
Non-GAAP adjustments: |
|
|
|
|
||||
Stock-based compensation |
|
|
4,521 |
|
|
|
2,717 |
|
Amortization of acquired intangibles |
|
|
30,636 |
|
|
|
26,342 |
|
Non-GAAP gross profit |
|
$ |
460,228 |
|
|
$ |
327,363 |
|
Non-GAAP gross margin |
|
|
53 |
% |
|
|
55 |
% |
Research and development |
|
$ |
240,611 |
|
$ |
174,800 |
|
|
Non-GAAP adjustments: |
|
|
|
|||||
Stock-based compensation |
|
|
(79,369 |
) |
|
(56,959 |
) |
|
Amortization of acquired intangibles |
|
|
(420 |
) |
|
— |
|
|
Payroll taxes related to stock-based compensation |
|
|
(6,178 |
) |
|
(10,729 |
) |
|
Non-GAAP research and development |
|
$ |
154,644 |
|
$ |
107,112 |
|
|
Non-GAAP research and development as a % of revenue |
|
|
18 |
% |
|
18 |
% |
|
|
|
|
|
|||||
Sales and marketing |
|
$ |
287,906 |
|
$ |
210,590 |
|
|
Non-GAAP adjustments: |
|
|
|
|||||
Stock-based compensation |
|
|
(47,586 |
) |
|
(41,636 |
) |
|
Amortization of acquired intangibles |
|
|
(20,403 |
) |
|
(18,694 |
) |
|
Payroll taxes related to stock-based compensation |
|
|
(3,830 |
) |
|
(7,349 |
) |
|
Non-GAAP sales and marketing |
|
$ |
216,087 |
|
$ |
142,911 |
|
|
Non-GAAP sales and marketing as a % of revenue |
|
|
25 |
% |
|
24 |
% |
|
|
|
|
|
|||||
General and administrative |
|
$ |
114,362 |
|
$ |
110,253 |
|
|
Non-GAAP adjustments: |
|
|
|
|||||
Stock-based compensation |
|
|
(23,799 |
) |
|
(35,843 |
) |
|
Amortization of acquired intangibles |
|
|
(7 |
) |
|
(115 |
) |
|
Acquisition-related expenses |
|
|
(660 |
) |
|
(2,764 |
) |
|
Charitable contributions |
|
|
(4,232 |
) |
|
(9,405 |
) |
|
Payroll taxes related to stock-based compensation |
|
|
(1,210 |
) |
|
(2,093 |
) |
|
Non-GAAP general and administrative |
|
$ |
84,454 |
|
$ |
60,033 |
|
|
Non-GAAP general and administrative as a % of revenue |
|
|
10 |
% |
|
10 |
% |
|
Loss from operations |
|
$ |
(217,808 |
) |
$ |
(197,339 |
) |
|
Operating margin |
(25 |
)% | (33 |
)% | ||||
Non-GAAP adjustments: |
|
|
|
|||||
Stock-based compensation |
|
|
155,275 |
|
|
137,155 |
|
|
Amortization of acquired intangibles |
|
|
51,466 |
|
|
45,151 |
|
|
Acquisition-related expenses |
|
|
660 |
|
|
2,764 |
|
|
Charitable contributions |
|
|
4,232 |
|
|
9,405 |
|
|
Payroll taxes related to stock-based compensation |
|
|
11,218 |
|
|
20,171 |
|
|
Non-GAAP income from operations |
|
$ |
5,043 |
|
$ |
17,307 |
|
|
Non-GAAP operating margin |
|
|
1 |
% |
|
3 |
% |
|
||||||||
Reconciliation to Non-GAAP Financial Measures |
||||||||
(In thousands, except shares, per share amounts and percentages) |
||||||||
(Unaudited) |
||||||||
|
|
Three Months Ended
|
||||||
|
|
|
2022 |
|
|
|
2021 |
|
Net loss attributable to common stockholders |
|
$ |
(221,627 |
) |
|
$ |
(206,542 |
) |
Non-GAAP adjustments: |
|
|
|
|
||||
Stock-based compensation |
|
|
155,275 |
|
|
|
137,155 |
|
Amortization of acquired intangibles |
|
|
51,466 |
|
|
|
45,151 |
|
Acquisition-related expenses |
|
|
660 |
|
|
|
2,764 |
|
Charitable contributions |
|
|
4,232 |
|
|
|
9,405 |
|
Payroll taxes related to stock-based compensation |
|
|
11,218 |
|
|
|
20,171 |
|
Amortization of debt discount and issuance costs |
|
|
338 |
|
|
|
3,373 |
|
Income tax benefit related to acquisition |
|
|
(1,137 |
) |
|
|
(366 |
) |
Provision for income tax effects related to Non-GAAP adjustments ** |
|
|
— |
|
|
|
(1,465 |
) |
Non-GAAP net income attributable to common stockholders |
|
$ |
425 |
|
|
$ |
9,646 |
|
Non-GAAP net income attributable to common stockholders as a % of revenue |
|
|
— |
% |
|
|
2 |
% |
|
|
|
|
|
||||
Net loss per share attributable to common stockholders, basic and diluted* |
|
$ |
(1.23 |
) |
|
$ |
(1.24 |
) |
Non-GAAP adjustments: |
|
|
|
|
||||
Stock-based compensation |
|
|
0.84 |
|
|
|
0.76 |
|
Amortization of acquired intangibles |
|
|
0.28 |
|
|
|
0.25 |
|
Acquisition-related expenses |
|
|
— |
|
|
|
0.02 |
|
Charitable contributions |
|
|
0.02 |
|
|
|
0.05 |
|
Payroll taxes related to stock-based compensation |
|
|
0.06 |
|
|
|
0.11 |
|
Amortization of debt discount and issuance costs |
|
|
— |
|
|
|
0.02 |
|
Income tax benefit related to acquisition |
|
|
(0.01 |
) |
|
|
— |
|
Provision for income tax effects related to Non-GAAP adjustments ** |
|
|
— |
|
|
|
(0.01 |
) |
Dilutive securities |
|
|
0.04 |
|
|
|
0.09 |
|
Non-GAAP net income per share attributable to common stockholders, diluted |
|
$ |
— |
|
|
$ |
0.05 |
|
|
|
|
|
|
||||
GAAP weighted-average shares used to compute net loss per share attributable to common stockholders, basic and diluted |
|
|
180,898,713 |
|
|
|
167,160,458 |
|
|
|
|
|
|
||||
Effect of dilutive securities (stock options, restricted stock units and convertible debt) |
|
|
3,615,224 |
|
|
|
13,442,439 |
|
|
|
|
|
|
||||
Non-GAAP weighted-average shares used to compute Non-GAAP net income per share attributable to common stockholders, diluted |
|
|
184,513,937 |
|
|
|
180,602,897 |
|
* Some columns may not add due to rounding
** In 2021 represents the tax effect of the non-GAAP adjustments based on the estimated non-GAAP tax rate of
View source version on businesswire.com: https://www.businesswire.com/news/home/20220504005984/en/
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