Overview
- Bank of America reiterated a Buy and raised its price target to $235 on Wednesday after updating forecasts and boosting its 2027 free‑cash‑flow multiple to about 27x.
- Twilio’s latest quarterly results support the view: first‑quarter revenue was $1.41 billion, non‑GAAP gross profit was $697 million, and the company raised its full‑year 2026 outlook.
- BofA’s analysis breaks out product‑level margins, estimating messaging margins in the low‑30% range while email, voice and Segment sit much higher, and it projects fiscal‑2027 adjusted gross profit of about $3.12 billion.
- Analysts flag two material risks to the margin thesis: Twilio’s heavy usage‑based revenue mix (about 74% of 2025 revenue) and recent A2P carrier fee increases that create modest near‑term margin noise.
- If Twilio sustains a durable shift to higher‑margin products, investors could see faster gross‑profit growth than revenue growth and a re‑rating of the stock, while customers may face more subscription pricing as usage declines.