Twilio Revenue Rises 20%, Stock Climbs 19% to Four-Year High

Twilio's stock soared 19% in out-of-hours trading after the company released a strong earnings report on Thursday, reaching its highest level in four years. The cloud communications company reported revenue growth of 20% year over year, marking its fastest growth rate in three years. Twilio also stated it experienced unprecedented demand for one AI function.

The stock rose an additional 20% following the earnings, reflecting successes in integrating AI into its products. Twilio builds tools that help companies make calls or send texts from apps. Khozema Shipchandler, who took the helm as CEO of Twilio in early 2024, replaced cofounder Jeff Lawson after serving as the company's CFO.

Twilio achieved its first full year of GAAP profitability in 2025, generating nearly $1 billion in free cash flow. 2 billion, was one of the most consequential decisions the company made. He added that Segment has helped Twilio with integrating data into AI models to improve customer engagement.

Shipchandler stated that Twilio sees AI as a catalyst because it is more of an infrastructure company. He noted that people cannot easily code much of what Twilio does because it meets regulatory requirements for telecommunications companies. Shipchandler also stated that Twilio sees itself positioned nicely as the infrastructure that drives a lot of the activity.

IDC projected that Twilio could be the underlying infrastructure for 80-100 million AI agents by 2029. Twilio integrates AI and data into its product and uses AI for coding, customer support, and inbound sales internally. Shipchandler said employees achieved a 15% productivity boost with AI, and the company uses AI tools such as Gemini and Claude Code internally.

Twilio is focusing on a few of its top products to get a higher return on investment for customers. The company's stock more than quadrupled between 2020 and 2021, peaking in early 2021, but declined sharply since its pandemic high in 2021. Twilio saw an exodus of executives in 2023, conducted layoffs in 2023, and shook up its leadership team with new product, marketing, and revenue chiefs.

Twilio was viewed as an acquisition target in 2023 and 2024. The company decided to keep Segment despite earlier pressures. Separately, Ole Rosgaard, President and Chief Executive Officer of Greif, stated that industrial demand remains weak with no near term recovery.

Rosgaard added that strong execution, pricing power and resilience help offset inflation, geopolitics and soft demand. He stated that the company focused on optimizing everything across the company.