TWLO
New glasses, same bull case
Twilio just got a little extra love from BofA Securities, and the market got a reminder that not all communications revenue is created equal. Analyst Koji Ikeda bumped his price target to $235 from $225 and kept the Buy rating, basically saying: the company’s still got some spring left in its step.
Why the optimism? Ikeda says Twilio’s real story isn’t just about revenue growth — it’s about gross profit growth, which is the financial equivalent of asking, “Cool, but how much money do you actually keep?” That matters because Twilio is shifting more of its business toward higher-margin voice, email, Segment, and other communications products.
The mix shift is the plot twist
Here’s the slightly nerdy but very important part: Twilio’s legacy messaging business still works, but it’s the least glamorous kid in the class. BofA estimates messaging gross margins in the low-30% range, while email sits in the mid-80s and voice clocks in around 73%. That mix shift can do a lot of heavy lifting.
In other words, Twilio doesn’t necessarily need to become a different company. It just needs more of its sales to come from the parts that make the spreadsheet look prettier.
Why investors should care
BofA also pointed to Twilio’s expanding multi-product strategy, rising enterprise demand for AI-powered customer engagement, and some chunky contract wins last quarter. The firm says Twilio signed three major contracts tied to about $42 billion in minimum contractual revenue, backed by more than $11 billion in financial guarantees across five agreements.
And yes, the stock was still down around 3% at the time of publication. So the market may be shrugging a bit today, but the analysts are basically saying the longer-term setup is improving.
Big picture: Twilio is trying to graduate from “messaging company” to “full-stack customer communications platform,” and Wall Street seems increasingly willing to give it extra credit for that makeover.