Twilio(TWLO) - 2025 Q1 - Quarterly Report

Financial Performance - Revenue for the three months ended March 31, 2025, was $1.17 billion, representing a 12$1.05 billion in the same period of 2024[106]. - Net income for the three months ended March 31, 2025, was $20.0 million, a significant improvement from a net loss of$(55.3) million in the same period of 2024[106]. - Total revenue for the three months ended March 31, 2025, was $1,172,463, an increase of 12$1,047,050 in the same period last year[148]. - Communications revenue increased by $124.8 million, or 13$0.6 million, or 1%, primarily due to new Segment Active Customer Accounts, with a Dollar-Based Net Expansion Rate of 94%[149]. - GAAP gross profit for the three months ended March 31, 2025, was $581,567, with a gross margin of 50$544,041 and 52% in the prior year[139]. - Non-GAAP income from operations for the same period was $213,408, with a non-GAAP operating margin of 18$159,610 and 15% in the previous year[141]. - Free cash flow for the three months ended March 31, 2025, was $178,315, with a free cash flow margin of 15$177,298 and 17% in the prior year[142]. - Basic net income per share was $0.13 for the three months ended March 31, 2025, compared to a loss of$0.31 in the prior year[144]. Customer Metrics - Active Customer Accounts increased to 335,000 as of March 31, 2025, up from 313,000 in the same period of 2024[113]. - The Dollar-Based Net Expansion Rate for the three months ended March 31, 2025, was 107%, compared to 102% in the same period of 2024[113]. - 73% of total revenue in the three months ended March 31, 2025, was generated from usage-based fees, compared to 71% in the same period of 2024[122]. - 27% of total revenue in the three months ended March 31, 2025, was generated from subscription-based fees, down from 29% in the same period of 2024[123]. Cost and Expenses - Total operating expenses decreased to $558,485 from$587,545 year-over-year, reflecting a reduction in general and administrative costs[144]. - Cost of revenue increased by $87.9 million, or 17$590.9 million for the three months ended March 31, 2025, primarily due to a $76.7 million increase in network service provider costs[151]. - Gross profit rose by$37.5 million, or 7%, to $581.6 million for the same period, influenced by revenue and cost factors[152]. - Total operating expenses decreased by$29.1 million, or 5%, to $558.5 million, with general and administrative expenses down by$20.5 million, or 18%[153][155]. - Research and development expenses decreased by $6.2 million, or 2$254.3 million for the three months ended March 31, 2025[153]. Cash Flow and Financing - Cash and cash equivalents were $467.1 million, with short-term marketable securities totaling$2.0 billion as of March 31, 2025[159]. - Cash provided by operating activities was $191.0 million, compared to$190.1 million in the prior year[167]. - Cash used in financing activities was $125.8 million, primarily for repurchasing 1.2 million shares of Class A common stock[172]. - The company authorized a share repurchase program of up to$2.0 billion, expiring on December 31, 2027[164]. - Other income (expenses), net, increased by $5.2 million, or 311$3.5 million, mainly due to a decrease in losses from equity method investments[156]. Strategic Focus - The company is focusing on product innovation and leveraging AI to drive revenue growth and market share[107]. - The company has realigned its business unit structure into a functional support model to enhance customer engagement[105]. - The company is monitoring macroeconomic conditions that may impact its results of operations[110]. Foreign Currency and Risk Management - The company does not anticipate material risks due to changes in interest rates, as a hypothetical 10% change would not have a material impact on financial statements[179]. - The functional currency of most foreign subsidiaries is the U.S. dollar, with local currencies including the Australian dollar, Brazilian real, and Euro among others[180]. - Revenue and expense accounts are remeasured at the average exchange rate during the transaction month, while monetary assets and liabilities are remeasured at period-end exchange rates[181]. - The company enters into foreign currency derivative hedging transactions to mitigate exposure to market risks from foreign currency exchange rate changes[182]. - A hypothetical 10% change in foreign exchange rates would not have a material impact on the company's financial statements[183].