Twilio (TWLO) 5 May 222022 Q1 Earnings call transcript

Company Profile

Participants

Bryan Vaniman	SVP, Corporate Development & IR
Jeff Lawson	Co-Founder, CEO
Elena Donio	President, Revenue
Khozema Shipchandler	COO
Alex Zukin	Wolfe Research
Frederick Havemeyer	Macquarie
Ittai Kidron	Oppenheimer
Derrick Wood	Cowen
Kash Rangan	Goldman Sachs
Matt Stotler	William Blair
Meta Marshall	Morgan Stanley
Michael Turrin	Wells Fargo
Ryan MacWilliams	Barclays
Samad Samana	Jefferies
Taylor McGinnis	UBS
Mark Murphy	JP Morgan

Call transcript

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon. My name is Emma, and I will be your conference operator today. At this time, I would like to welcome everyone to the Twilio First Quarter 2022 Earnings Conference Call. [Operator Instructions] Thank you. Bryan Vaniman, SVP, Corporate Development and Investor Relations, you may begin your conference.

Bryan Vaniman

Emma. Thanks, and Earnings joining Conference everyone, First for you XXXX Quarter Call. thank afternoon, us for Twilio’s Good

Our prepared be remarks, filings IR and earnings at press release, replay website today’s investor of call will investors.twilio.com. found our a on presentation, SEC

Lawson, for President Elena and Shipchandler, Jeff Revenue; and COO. CEO; Joining me are Co-Founder today Khozema Q&A Donio, of

in As non-GAAP and our found between non-GAAP results earnings terms. further can some related our GAAP our guidance today commentary of reminder, release. Reconciliations a may in to information be press and be

Additionally, description statements. and recent our actual remark and subsequent or that risks, materialize any financial Form a affect – our discussion results financial of reference. or are These uncertainties responses our considered should including contain other filings, XX-Q. should materially to risks incorrect, by implied those today’s by reports to our and marked expectations forward-looking should could differ forward-looking our our be projections risks, included SEC these uncertainties factors subject projections this performance. A And forward-looking XX-K incorporate discussion these and statements, And and and could assumptions assumptions. regarding from prove future of be statements to on our Form information including are these results on assumptions during in report most

to any open for date remarks. that, I’ll as our call occurrence Forward-looking update only made Jeff unanticipated over except with are by statements statements such or Q&A. required law. the the circumstances We information this new and it after made. opening the And Then for events some statements no reflect call of or of today to beliefs or to we’ll forward-looking hand represent as events, to during undertake obligation assumptions reflect

Jeff Lawson

a since and growth of Fourth contributions extensive the culture Twilio Marc help and years. of welcome is to partnership officially remarkable on Elena With let our me with the his will her that, lastly, open of I’m and leader and to scaling for thank knowledge as Elena served its to Boroditsky Axiom the our Revenue. over And former activity you next call proposition go-to-market business, CEO to phase organic deliver And customer starting revenue team. be for results I this with confident XXXX. the annual to of in execute XXXX. our to in Bryan. and XXXX, we’re over which achieve on the you saw continue the member, leading ability our growth delivering years. world’s as to continue and targets to committed annual a growth profitability the quarter to make delivered To former remarks we’ll in strong another investments profitability put our XX% platform. against welcome in as operating engagement We long-term to Thanks, excited strategy and plus deliver build Board We through coming goal, really release, value of Elena the deep executive President will Donio, leading Twilio SAP experience has against our remain solid and a likely press And President we our Twilio prepared us our necessary Concur. our Elena Board former of market, trajectory having and thrilled to XXXX, are want non-GAAP of course, to questions. X and May last the Twilio the growth, massive all.

Operator

of question the comes first Marshall line Meta Morgan from today [Operator Stanley. Instructions] Your with

Q –Meta Marshall

Perfect.

follow-up. that change? efforts what and first bit was? making just on had the just behind kind I have question, a maybe or a you given the Maybe continuity background changes, any in of a And that Just thinking give of you that kind more Could starting then recent transition. of CRO considerations little as management

A –Jeff Lawson

Meta. Absolutely,

years the her do tremendously experience. I’ve the leadership her world-class team. opportunity, And look, caliber, operating on person the an and like step fortunate perfect we Twilio’s more So the had at I role in with our chance role et she and given a familiar to for intended perfect into was jump involved the the have And departure, with throughout continuing with the a considering incredibly when her to already conversations to you And role you look, Elena’s of have actively leader so. opportunity customers, her next opportunity was and get as cetera. the involved, people to we’re believe bring organization, team, Elena about the she that ongoing Marc’s always

to the the Board, the SaaS, addition things a products from in experience we’re doing. rapid are wealth software, in in organizations go-to-market, insights that company, her And her on and those into products costs our a direct she obviously brings on and scaling all in managing culture through while of growth. period In tremendous time focused of

President extremely to in in join our And forward to go-to-market in the of over I’m for Revenue to contributions Elena the incredibly years. and the enormous by way, as his I’m So Twilio excited latest the company efforts. grateful have Marc

Q –Meta Marshall

are trends, a that downtick worth in sequential QX be just that, clearly, Appreciate in growth given in past any that noted or may any growth organic in may you it. of there guidance as sequential the guys that And a quarter. noting the Got that caused that. just the would rate? kind the in be volatility you XX% think follow-up, I not mean, growth growth rate be quarter-on-quarter have Khozema, But in in

Khozema Shipchandler

basis, consistent year, last Meta, strong organic the is an to thing that communicating we not a had been about really in really, at then is quarter year-over-year. really. mind annual organic in on pretty XX% target big that. think I XX% we’ve here that QX ‘XX And growth I keep and mean obviously the

we at we of half. So a through good year, reported see And set as the as organically, and XX% the quarter we pretty second as XX% out XX% second QX. at we look the feel for look balance to go of we XX% then favorable more about to then the comparisons

so as previously. we pretty for do XXXX good about feel about XX% and communicated good and for we we’ve the XX% also year, And feel XXXX,

Operator

Kash comes the Rangan from of Sachs. line question Goldman next Your with

Kash Rangan

that et prioritizing leverage investments to things determined sources for more it's I'm towards could you thoughts has volatility on maybe to And in of us secondly, give rates or will has That's customers lot the provide changed. there's Give how customers' gear Obviously, deploy What Twilio the operating Jeff, in a tech not been of laudable it me. some in the are Twilio. cetera. operating your are perspective also operationally that propensity environment. see if and on future? that broader the company state-of-the-union us curious leverage,

Khozema Shipchandler

Yes.

as a this don't there. Jeff Kash, has There's of add, in can couple well. if And Khozema. So then things you to Why is I comment start? anything

of the you that's terms in where just macro, think started. I So

models. we I from obviously, the not as what customer that. in forward. of report on this see we transformation boardroom just economy positioned that benefits macro But it's business is the not a significant as to invest both environment, we're studies, if engagement see based extremely studies, capitalize were of company's going recession, remains to our supply economic our a look engagement despite not efforts. geopolitical, top digital number external to ongoing well but sort priority. inflationary, it's those of we whether the is necessarily well past, think, to built alluded internal we or companies and immune labor in that or rates, like which And variety we've on their don't like inflation chain, into we're dip whether like see transformation talked mentioned, digital impacts a are the strategies -- into some think impacts obviously we recently Twilio as That that And it you interest or about more we be as

to crucial of piece a rate of where capabilities, periods growth general, they recently, planned in X were profitability where the there were go-to-market as prior helps years number customer forward, a not more in we've think those peak And that those these these -- your sheet, growth our in we've see the that in of the obviously, be our going have like about Flex, to investments strong really benefit because investments we cost a is to make. been than to What also through revenue about stack. going our been and the the as on investments. ended. good which not balance of we of very guidance annual And are is coming I historically. saying And invest growth We at And with felt XXXX. question non-GAAP operating profitability feel And plus were profitability over said really in again, kind it's environments. important to question, XX% we engagement we're having lower I Segment but More as XXXX, in that's going obviously in you of we're or investments.

so slowing profitability be And the there I up for into growth, non-GAAP next think, getting the way year. that cost we that will end

Operator

next Turrin line Wells comes Your question the of Fargo. from with Michael

Michael Turrin

improvement fluctuation a saw margin just sequentially. remarks prepared potential. meaningful The Gross referenced near-term still some

context through? I moderating? can like? code a at at regardless where somewhat be our we're impacts are just you of at provide at around that gross why is XXDLC bottoming Just mix of sort can in Are plays of least fluctuations wouldn't you help if these through. of time ZIP normalization Or anything the around playing adding U.S. sort think what some in through else a looking point that that. margin us messaging all of just could more these guess to Some is comfortable least question similar remain growth look

Khozema Shipchandler

I QX, them obviously good Yes. question. margins a That's happy gross to in XX%. with to think improving are with the I respect we mean

keep thing in to of and what you is I'd Michael, is our just encourage think, size drive messaging I scale business it. the to tends that the mind

And in level of fluctuation why term. kind gross of in signaling near some the so that's we're margins

does our at customers about talking those up. remind they're going that important call and on and the code. it'll quarters be in going margins of think real gross that. strategic gross the messaging on it those not we so obviously, can prepared mean we over sure that that the like there's be still door back profits ZIP that the to messaging a execute lot. the that reinvest deals, into to while in not making the up that also And a with few last it and or lower as in and generates some serves that But business I'm drive And I or gross bottom everyone we in time opportunities, evaluate margin, carry I'd anything we've And on business. lower looking there. foot like lot to strategy, we you spent whether this also I value

our there, that over carry And grow continue software a is we I we this targets for strategy around to rates significantly sort on quarters. and to gross we've that lot our business quite software higher continues elevated that emerging tailwind about obviously to like time, think think plus the of we we continue see talking XX% And last businesses does and to like just the flip all been up of at long-term have margins. of lot. several a executing continue of the about as

Michael Turrin

just marketing all in really a the near-term back spend change down keep just think there? useful. continuity Or expect? to we that off to there see I transition midyear? That's assess making we the Elena It and the any how how should field. should sequentially. And like onto Can board looked maybe touch Yes. ticked changes great we sales coming then Are go you

So useful. think of also kind hit those, that's I if just can you on

Khozema Shipchandler

much love just term. short to we've positive leadership term, in That certainly of maybe in And for that lens team think is I few really impact Right strong. long look, of a very provide the go-to-market then But I we Elena the will don't and the think short, Elena got a her anticipated expect on have going on an is maybe I certainly business. some team place. great to very now, impact introduce the transition have I'd we the results. of go-to-market to comments. a answer in yourself And own of

the We with I coming think rest that to we've a have really plan positive board, mean, I'm going The and in as personally, the I have very already QX said, for are year. I seen think clear a And she's excited a on setup for Elena execution. of I results impact. good

she to speaks record moment, to things. me caliber the part. her a track for more bring over think little about of can really a bit tell I for lucky be and thinking how just team -- her management to her maybe on on it itself is But should and person turn a our let about you

Elena Donio

But X quite meet the different a for have ride our to knowing nice our familiar company. the was become Michael, a an Board as that is years, of on our served really the Board Kho. just I with it lens. and past customers, the products, lens from backdrop which from operating Having really you. lifetime, Thanks, team our sales from all motion, the knowing with

of so I background, proud Board and I'll many skill the think early my driving bring operations my customers, in scale. delivering And in bringing in company. into to hopefully, everything of doing the team career growth road set with a and actively and to I'm the even own say start lessons to also excellence, our look is team opportunity the particularly I but whole listening members, perhaps forward huge but ton I also I'm done spent even the the learning, and a and more ahead with they've days. capability a that I've that, fantastic exciting. see engaged learned really role team. investors. past of really, We operational

to leader as like the feel them I really envision also accomplishments also the ride team, engagement. good here, here I'm pretty sit perch their all customer to meet of I so future with of congratulate to to learn great about excited a but but from on from, rest continuing the And historically, them to jump and in the a on have from

Operator

Mark of next question line the JP with Morgan. from Murphy comes Your

Mark Murphy

then And I last Could side. some understand X done to versus And kind ADP And for that the process little? friction anything And if there a But joined deadline if it's customers or themselves? a a get minute solely about just me, that during the I'm in quarter, friction to the is fees onboarding follow-up. redundant. the describe domestic you late, I of had have to forgive related trying a quick mentioned case March? on registration you was

Khozema Shipchandler

Khozema. Yes. you. is this Mark, Good from hear to

seamless of and some and term, create for And the friction kind more does to just trust XXDLC have customers. with of registration that slowdown both really the built number friction process. platform. that the on was some our traffic onboarding saw, our existing now to for growth domestically short of And of a in over to our the as And majority but been we associated has a features customers. lot process So generally result it with of a make friction time, we do get the process registration more able creates through new the that

we year. deadline, of about so to of domestic and that that and And normalize that expect I the do deadline, majority was us. With behind the your through initial completed respect us behind that's also messaging believe X. the a now think March a that there balance our having we to question traffic, process, And with was

Mark Murphy

for still one In days. X-way believe I messaging. early you it's the past, on said quick the a just then that Jeff of And topic

another And quarter so your got now belt. under you've

with got kind there conversation see product the Do developing. X-way of terms perhaps in API backlog Or any you building more front-line the You've is of a activity? messaging? any and

Jeff Lawson

Thanks, Mark. Yes.

and think messaging. a interesting one-way messaging And like the a so, X in great I opportunity or first been ways. to for the opening is that world decade the door actually has thing the Twilio all, for where I've of last there's long place as the the be that tremendous it's said market

we question it the you for who you And to great all So we to it's Are about just trying using notifications a actually call that to how has it? or to customers us. want listen some just all stuff. okay, messaging What apply. us? to and we talk of to And to alerts to to increasingly, going Are customers do going to to We're give automated say invites our us? silence want kind then is, when are Or to going says who look, we to out are companies customers? wants company get then and us, we're over In in Like lead apply and our business, we are pay customer customers a like, the talk are going us? radio us. ignore that be that in of attention them? to others saying, actually given want And customers to wanting on advertisers fact, to them. ignoring talk talk those here, to the to to pay

in the like it so makes lobbied against financial conversations. You seeing X-way you fine markets X-way the the one And And banks for noncompliant saw like open they just these of that major it large messaging. services, certain ton doing a right? sense because were of would we're door

real or expert is yes, And going really they're of lot And customers. you investing hearing matter. lot hey, Okay, I clienteling because we've we to ones in it's to opportunities us like to on the we planned an this has in the are like now not They website, will build product that for see that's with of Nike allow industry leads that history road we've attention relationship stores. are a like that engaging companies and who Flex how the their the the call to want why -- taken that, customers from retail, the whether map there. app X-way a we're future who you're using whole of a Other companies that, in of got saying, are they advice. use to talk their salespeople, conversation over customers math

When tell to this order combine And connect this they're really that multiple like occurring customer, a substrate channels we multiple WhatsApp And whether in I company. our a products it Facebook wanted the of the And and of a opportunity, different elsewhere through even while. was two, there cool. different all you, so a they're things And increasingly layer companies when and shift, you're and and software we that musical all I Flex, really to been these the SMS start placed in see over so parties true you to or and right, the like, that that text in customer And at phone together. big companies investing does API weeks I think where -- like an contact dots conversations showing conversations, of who the They and conversation, is that, voice couple of express and with a line completely see their a example. the company, between like, then actually one that give customer all package and Frontline what points you company of them as conversations could conversation? can't is and Yes, it sense? I are the company. is Actually, by across to If actually different conversation adopting. just and a And new. this got as conversation. other company I the it, the I sells cool they're the for it of a shortcuts, It XX it's the hey, more we number ago. long-running listening? of got on care my could coherent really in it day, XX you to make see At way, but a I a Jeff, are is X. sort just shipped. consumer. your bunch from number is that as care that's is, as this see gear. it Twilio one just you Or about experienced it that with of people, And destroyed example end They end customers and is numbers they they're we've I'll see message it see in try that. they I was said, a that's might well. -- And more your I somebody everyone departments you salesperson. was well, you're talk And

I from a said, person. know, don't somebody what like it's seems you And it happens reply? if

this Started and yeah, like his enough, a links, out. that. find the has. experience. Let's It's at I call I turn question bad back company, you how that. like, Oh everybody customer time. telling question. blog some replying a me look wasting experience I'm with this about And including listening some see, now can I now, to I I've asked about customer amazing this and sure I'm amazing, was person setup to me. him talk got some that, can posts to got with at look everybody, But company help and feel amazing around right to I sent I

is instrument yes, a snorkel. banking think or X-way the messaging a a a you're I So fantastic, buying musical whether product, mortgage,

Mark Murphy

Maybe music you can time. some some play us

Jeff Lawson

You that. don't want

-- snorkel go rather You'd

Operator

Your next Wood line Cowen. question comes from of Derrick the today with

Derrick Wood

I for Jeff, you, guess first.

that of of quarter leadership have last to the all look of rest guys into organization. near-term from so much what seen You and the increased have this larger companies lot terms change just looking year? quickly of headcount year. these have any of seen some forward? is a attrition But just many changes looking are over curious, in the adding backwards the QX, as had a investments a evolve disruption the and you there then attrition like scaled bit the in little QX. or of of It sounds for have -- kind certainly in in We've backfilling And plans at kind been

Jeff Lawson

Thanks, a about across And Derrick. attrition see I turnover is the never to elevated it's executive like the the you sure. I'll market question think And question. answer for executive. fair see of it in are tech. the economy, basically, and as quickly Twilio companies It's this aside probably, as growing is. you that just Twilio. true It's especially actually entire not and

to to leaders is And we're relevant the company. necessary are, company to company product but go. we that for have at And where who the all to we tremendous us living growth been time. where but brings also direct next doing also company, to that SaaS, in consistently we leaders us attract growth. in grow organizations are going managing both any ways, have always like, And years. gotten a some in fast that and it's we appreciative look, in going level. software, it's the are so and can And things expertise rapid incredible what looking in every look doing what Elena really at take are same all able highly you right go-to-market reality and scaling take that's with to do the are But are the to wealth a reality things the forward the as very of while the experience those leaders coming through Twilio to we be these costs in And now in for and that building we we of doing I

to And have an to efforts go I right, going executive. you by I'm driving when so say it's always excited our always bittersweet, her forward. incredibly go-to-market look, look, -- And

in the been trenches. You've

coming years. or but then people faults, XX with work in I've been for you're really You also to going. to bring running you Twilio And where here forward look the you

incredibly I've in, of you billion the we groups very quickly. company a are it's part come me when executives So company, growing of happens to quickly. what $X.X just revenue like, today, company grow sort of yes, build where a seen And help

Derrick Wood

that broader numbers specific how to terms and growth or doubt, how services, but force you've Real Khozema, sense. share trended a growth. for makes sales -- in getting Segment? to know on performed of anything against around had quick, That around not application training the we're lot efforts the share you. No expectations? anything And of I incredible

Khozema Shipchandler

we repeat about additive the Yes. feel the general, targets past, that a growing really, rates. good team gross performance is product. about great has we lot. to And we And plus. that of our Segment the been the should product it. a about faith accelerate more many obviously, that certainly talked software what of long-term I long-term profile, get underscores margin trained generally the to as the think category elevated in I really we mean, based kind over your of obviously, success has it's that in on XX% been as its question, that And people growth can specific like say, our up And we've time. Twilio. really I'd feel having of on clearly More certainly, really, can, possibly margin to We at of which

with So to feel we it's leadership. engagement us are out important about be good really and we going Segment, to where as customer really build our

Operator

Your next line with from Samad comes Samana of the question Jefferies.

Samad Samana

usually, I go and mix I you, versus the should how just guess gross international I XQ first want XQ, I put in, to and higher one re-litigate Khozema. When margins but margins. on think about think disclosure about back the U.S., that the U.S. I'm for the curious necessarily, domestic we don't gross than international.

should I gross have not think And was I'm there something XQ margin the about then mix, for Jeff. follow-up we that a for curious it else was if just So maybe pressure?

Khozema Shipchandler

Yes. -- question. It's Samad, fair a it's

Luckily, So discrepancy caught ran have domestic discrepancy to the was there in was caught we a happened, the versus off, then. maybe just process kind of the QX, it QX. we noticed and as should in what international revenue, closing in that it first been own of mix and

as We have answering in before transpire. additional as put I your that make did like to place it some doesn't well some sure own something question. to want analytics controls But that, additional

that a In register terms way address with time of the the the Twilio. at of address they disclosure, split the IP that based the provide that is mailing we on or customer that split,

messaging messages something pretty years the of tends impact did be see well. tends them if that gross is terminate, on from very more grow business And to in continued split Day, XX-XX, there we And outside to Like day. to correlation couple is showed as that mean, significant it's from remains for it's actually we business it's you is, and day when origin effectively, back the we of But obviously so true as to reporting SIGNAL, customer gist the continue go deviate that's from used we between where can I Samad, to but QX there. not to you it strong a commentary And U.S. today. be what period purposes, the destination that manage know of the about Obviously, that actually we how why on some that period. focus and terminate and where well And growth those that, the margin. Investor messages we much the

Samad Samana

And clarity there. the definitely really I helpful. That's appreciate additional

up And and -- is on, think the business lot very clears knowing the is follow end numbers. with the I big on the and the I that touched up. Jeff, a at which want to that it still growth of of something strong day, Khozema look

So I forward, higher? company are of are or and you on that I the there that going changes we the going just based How are to growth changes reiterating changes kind that think the think in Or about anticipated maybe go-to-market guess when the XX%-plus should about think it are in go-to-market the happen? team? management what guidance

Jeff Lawson

Elena question? don't Samad. you, Thank I have answer that Why

Elena Donio

Thank you.

lot say trajectory. Like So continue I like all, our to tend long-term first really we is well. growth going and I'd a trajectory, that of along

greatest their and know getting of it's about is when I to first of that. months, Engage accelerating spent is go two how have along we short-term But and that more and know foremost, Number so software team growth, plans. resource important that I one internalize customers obviously deeply to really possible. couple the towards I really think once especially the Number a so can there's and first explicitly And about as my would our model I calibrating get launched. efficacy them Segment aspirations priorities say couple with our

time and we've in doing lastly, And built capabilities messaging, our direct that growth paying while off operating of so product-led both those nurturing we're the over overall so past over amping our things but software. years. we've and sales of channel And that and up driving engine number investments that also additional made go-to-market the means ultimately leverage

Operator

Kidron of Your the Ittai next question Oppenheimer. from with comes line

Ittai Kidron

here regards any When Twilio color to think Engage. that traction timing? with you going bit Maybe, it's a and Jeff, I'll be, start with activity can you to you trial little specific more perhaps the on Can with we be customers? out? available? about on adoption is once first, should finally How share And

Jeff Lawson

Ittai. Thanks,

So first know, early customers. second year, we're new of half the from as we Engage and a in market. a you on of is -- looking into bring all, And product what learning second GA at the you timing, and our the are

it where as you guide You help and bring focusing. do on tell handful you and road a you to the they be customers. of map, beta they format, early And your

and first BXC these can accept. that's solve of the them we list customers great And want Engage filling sure is always feedback think receiving from and pilot hole I that to market built sign. of to with all, and and a companies, really taking -- we're like particular, their every are a those data with a understand requesting we're in early more terms been of the the in solve to understanding of uniquely. empowering in making problems employees problems apps they understanding and we Engage the help building. from is data personalizing that great really by with have actually journey Engage then customers we've the the have on And and we steps responding Engage, But platform so their part feedback, execute good feedback customers And product, access the the building look, customers

turning world third-party modern I privacy-forward is marketing, taking and it Engage especially And personalize saying, they data-first what need understand I so -- don't are about think that are pay with And where my customers the need have journey customer. that is on really is doing, so the modern customer I companies and when can't advertising become happy do kind bought just to marketers marketing. anonymous way whole on to repeat in platform. you them that, thing you IDFA good cookies through to to that is approach a customers. that an attention loyal, you Really, the of lazy and this

tools that companies early of are saying, are what are here's to seeing in our because access And types do are not this we look, resting on out who pilot we so those the need. there the they're

so I way. marketing And this going fullness Twilio's is time, gap. to filling in think And of go the look, all this

platform to blindly well, all first is where be like spending to I and think best of data, measuring, want to having data about campaigns money is as opposed of activating really all, starts, to which that a to, on have and me going just marketer every is the people the then many going sending how subscribe.

of I this you for of And data can a data by the optimize spot They the think basis clicks. too. the can money that just, and of sees other make systems. the got sees outcome variety those that, for not business neat because many -- don't you flow the gets make thing is as care days marketing opens Nobody the are tell Segment from money and We sales. using Segment over. with big the many And tool clicks. there's opens companies this campaign, like about marketer

amazing. say, of sales. this not. working. dollars is resulted So they in amount of is campaign hey, can This This That's campaign this one

think to and company And who marketer saying, to that to making on we're they're on be look, money now because spend so you can it. about the proposition the give able tool you'd justify value a the

to So I second early still product, in anticipate think proposition. life we half but great a in value bringing cycle that But GA obviously, of year. of the the it it's the really

Ittai Kidron

great. Khozema. then a follow-up That's Okay. you, for And

year at going activities the of the half you second gross your year. is clearly messaging – the about that, that you volume messaging around progress. gross stick X, is the talked that of customers year. were not again. registration second March normalize. come date, think half the that I around expect on in to messaging Just trying normalization of see so assume Great to margin, to to half And the registered and the the means that some part I somewhat adjusted that higher where in margin tie the I'm depressed a to volumes the political just second because and into was date, that you have of also

any not should the incremental half that way and expect inflate these -- the elements right about So the messaging messaging, we some now to think going year-end second perhaps because gross year? Is X to of margin volumes things? just between are in improvements

Khozema Shipchandler

Ittai. Yes,

our if forecasting. necessarily of possible, it's broke certainly it's that that but way, not we're think all something I

principal on As are margins. of down. gross the it's you really fluctuates that way a tends that that to kind And it way know, end the traffic that anything it's mix drive say the just would what so on out, the big, fairly plays I up factors and and more who and of I how messages business all scale such of the I mean, I things. I really going don't driver. than it's are that those the to is just terminating be it in mean based it the mean, messaging prior up guide question, -- said complex that drives and we going be to

it's I that but going so we're the today. it's something not ZIP And be think in code, to guiding to

Operator

question JMP. of next Your comes Joe line from the Goodwin with

Q –Unidentified Analyst

Great.

think I for question Pat. I a have me, be Elena, that might you.

might companies Concur and you from boards you of at can relevant Just that things you think at you're your be I hear learnings be would sort or of might or have the apply other that time other Twilio. any love to on some

Elena Donio

much. lot acquired at XXXX. started the in I Concur for question Thanks Yes. when I Bellevue was hope learnings. there's a of startup very my

saw early market of all and along to the of products and the from And of XXXXs so with amazing transitions some that. dot-com boom the XXXX went through years that and bust kind

and to whole ultimately focused company federal end one and of U.S. company became company platform host So that's overseas, invoice reporting SaaS a a company sort management Web sold the a that growing into CDs from of downmarket. growing travel front a on-premise, others while government, growing to company one from moving mobile, product that the from a a on sold shipping to

So seen into transitions and it lot lot change the of President certainly from different a period including of acquired our of role people. in when of that, by a all away were a and SAP we take for intense moving lessons came have XXXX, with

the growth, And myself growth and making the so human we're I of period maybe that things those but embracing the think about thinking sure fantastic and a equally sort most are of is leadership. our navigating on people, of side some careers I of pride

So the to to as I'm process. as I excited much bring can that of

business. In as the me operating was of I move terms a into unique X think and an ride boards, for I But it's shift lens great other into this last the years, me that Twilio lens interesting over role. given new learning will

the general, on that interesting investors, are in boards, other number sit that I other I building board hearing I'd think leadership from I opportunities to from. still learn me other just mix, teams, think other Lastly, and say general in boards, products do I board of as in a private work keeps think work both other

that me I’m in Twilio, into I so here work about excited will learning here versa, a all that. that the excited that And but learned mouthpiece be talent to industry be house bring best set the the I'm hope as vice still in continue around to I building wonderful of from virtually. and to the do sort of also this

Operator

Macquarie. of from line Frank next question the comes with Havemeyer Your

Frederick Havemeyer

Close. Havemeyer. Fred

we've actually recently, have So executive of within happened made discussed Twilio a -- of And ask prominent X hires. couple I you the and I firstly a privacy trust-related wanted couple that that to recently. changes noticed

as just wanted inherently trust Twilio you're both So importance what and the environment privacy the of is are I to globally of as trust-based policies? navigating expanding XXDLC and you perhaps ask, to also

Jeff Lawson

Yes.

Khozema Shipchandler

Jeff. Go ahead,

Jeff Lawson

privacy the is Fred, their it's customers. privacy right, with to this I of think Look, answer obviously, I some is most it. as Jeff. I with our And companies mean, important in trust for this the the -- era, trust, investing just and, concepts privacy mean, our I'll be relationships coming and nature of of the serve revenue and really talked like advertising and particular customers. changing a about way changing is the where landscape and acquire in we is privacy -- like companies how the lot from. build And and about with privacy companies it's

that see through coming some earnings. of you think in I

the think that companies bases. way their see about you customer building go I

way layers not? of I go X then And private think website, please to information no? is you've getting to that wins privacy we like, it yes, government, is to not the like, [indiscernible]. about with we is you to time don't that growth a their really the like your in it you and It's companies got complex. is this the want it just world a This not fact I you lot, do you’re sell every have personal way my that or And in dialogue. and landscape like navigate incredibly click the the information, testers like have. Can agreed do sell

across doing Segment. that for are third-party that the changes this the our our don't obviously and that comply b, where that but our help customers IDFA we're Segment everything the they the They privacy products customers also the companies brought helping does. customers so have company it So not about every People things because, and is dictating better world Think kind to and rely -- and understand shenanigans what going of to is a, all Apple that about on like platforms navigate respected. and stuff and, through only consumers Internet. privacy, is cookies employees own building are this like their to Twilio want be tracked own are doing with has a

Internet shifts gone for since the out largest honestly. that's a vehicle on the business, became of one is this so And

that, navigate so help helping not navigate is but only helping our that customers us incredibly important. Twilio And

and changes on program So the compliance -- Amy responsible works. this for to utterly regulations is complex the enormous and going of the shift Internet lead team the privacy navigating this

Frederick Havemeyer

And the solid analysts asked question, but sheet. you be a it'd M&A have now positioning the I balance suppose your on

in Just Twilio could update or And market, thinking of how appetite? having wanted on is related generally, as progressing? a question, valuations kind where give compressed to relationship then Syniverse is ask with the any its you this about M&A the how

Khozema Shipchandler

Khozema. is this Fred,

the part take me second Let first.

the I by agreement, Syniverse, of transaction of closing anticipate May. end of the think that subject to closing the terms we conditions In do

M&A an that more part probably business. of getting think forward to that's in game organization going at. certainly the you're look maintain be and the we a with how opportunities you're a what opportunistic. important And balance strong we messaging we different relationship Relative think do that certainly broadly, and the remains will remain I and evaluate go great, board. right sheet. We're I all that have to very we mean, time And

and along nothing about and like imminent take all really it. a we'll comes can think we feel good And I planned I this about at a say if time. necessarily there's that but it's look, that's fit, certainly something

Operator

Your line next comes Blair. question of Matt from William with the Stotler

Matt Stotler

with and guess one. kind and looking mean, at seeing intentions at of I what's kind we're but overall the of happening of spending your market Kind trends so specifically Segment, terms services, customers we're and we're opportunities, application of Flex a it it partners, in for I right? seems setting right now. quickly. growing year like But for mean, position a just just like interesting pretty seems particular Obviously, up I advantageous in what Flex looking it's the and and in been

of thoughts not some that? pipeline kind So then for year expand I'm effect year. Obviously, what relates if how thoughts CDP, of And this the but of the you're pull-through seeing a And in in of of more of you're the having of Any on guidance, is to terms or looking just to course kind the for Segment maybe that Flex at addition interest color asking over bundling get qualitative. the I'd developing. ramp it just like product is on how as there? kind

Jeff Lawson

to continue traction Yes. excited with make see is question. Thanks, Look, pay customers, on to with I'll we we're to earnings great attention call Flex. progress that really our This the the we and the calls. Matt. answer out Jeff. we're customers with particular, in continuing And really

everything different Fortune all see of like from the to companies selection legacy up You XXX, a Fortune in companies. legacy, nice gen way verticals, XXX disruptors digital like the enormous sizes, different really

world about we’ve the provide this to And just of with the legacy digital are that we remain Flex. who expanding seeing today. us. can't was we've channels excited the like flexibility of for XXXX traction the first the Compass the automaker, time take they today, the need and we on thing company, you calls. prepared is And hear why Global XXXX mean opportunity so Global of consistently really like these really their are cases customers in ahead referenced Flex about the seen I but address in the a And we're so that mean, also remarks see customers customers talked adopters of companies one or see I the Flex like use and -- set is a companies on a the we earnings from services great companies financial prior we solutions

on what's talked market. strong. surface about brought segments partner take and into of into We're just possible take of Board to And traction different partners it And the types go-to-market to with is verticals the also accelerate actually ecosystem. we help we've so our overall, it of our our scratching the

the about the think here. the we're that amazing So direct ecosystem customers we're opportunity you've partner love an your for I we're really serving. that addressing fact look, got we're seeing it's for We And -- we're excited building, market digital the disruptors.

You've got your enterprises.

in all if everything around using You've the and between also, you got world particular. notice, or using Twilio -- Flex

think so we need, set and market seen, see. great which the see And is I and hypothesis. hitting those way you I a That's you of helping you're what broad have [trends] are your that out proving a customers

Operator

from comes question McGinnis the of Taylor UBS. next Your with line

Taylor McGinnis

year seeing ahead, in is in that comp throughout thoughts could that on engagement in and customer how based as that and might ZIP margins mix? influencing becoming XQ look a much code? the evolve any mix the be look messaging line there on by could I of some get gross businesses Another the portion think versus maybe recovery other there high-margin growth at the And and on increase, the we guess, as XQ is sequential a -- that bigger in when gross and that how stay tough you're your you view But the domestic the or Segment color just one how just we of we margin. on provide any then driven been what have versus would about today, revenue the of compares of when can easier given too, we

Khozema Shipchandler

Khozema. Yes. is Taylor, this

So a let couple me to of unpack it try there, a bit. questions in so just

the of total was QX the the specific just mean, organic pieces, really and not there, So last QX growth in in set year, alluding quarter. I then half the year. relative of any to terms year to Last I a second business for was comp XX%

half why plus half therefore, about And that's year setup way to provides that for great next the for we of guidance second so feel a that's did And this year, more we the continue we favorable the QX this our year. the back for year. whereas guide XX% why

of the terms most messaging, In driven QX of relative margin mean, terminating, the part what looking our sequential that, by margins you. are size at their I the happy business, they inspired. the given of fluctuations what in that are in obviously, kind that are, various behaving what just that underneath with of are But accounts are to themselves QX, we're I way in think, rates various business have things what

We of margins Twilio messaging to earlier, gross to that I so a And drive provide kind are messaging mix the were also comfortable a customers. more entry that meaningful the probably business. the mix broadly. just in sure that gross most off. tends make And us alluded And the with they those We the of just way throws point hurdle that importantly it as into that reinvest profits. provides margins we very accretive, interesting is of relationships. love deals of for profit but those not strategic that we And

feel of the terms components of really business, good I the really, said, In Segment. as we about software still

Flex as to of do and gross have elevated energy we that And And longer-term you messaging, gave a too, feel the of it'll mix at about as about over I quarter. said. time, Jeff's we the the that ago guidance other some product. And take gross the shift and moment And disclosures that continue we given business part heard some You higher of you XX% that, size carry around we of time in that prior margin in but time. grow indication our that comments our services, happens great that over plus. go we anticipate do think application margins, rates

Operator

of comes Barclays. question the next from with Ryan Your MacWilliams line

Ryan MacWilliams

So like looks on there this in could be price from this this price that U.S. memory some heard like SMS. the If a customers month the we is increase case, Twilio the U.S. increase in recent first

growth? the So can And how if thought maybe this behind about should process mean that, true? maybe that's for rev we think what U.S.

Khozema Shipchandler

part last I what? Ryan. could it mean of didn't What your the question, hear for

Ryan MacWilliams

rev U.S. growth?

Khozema Shipchandler

what that is growth, revenue said? you U.S.

Ryan MacWilliams

Yes, yes.

Khozema Shipchandler

and who And products. reflect true. through; as our or and term. expect necessarily sense in We messaging. Canada May. continuous to reliable So put customers our update in XXth and did price it that we software make global on And price, The both fixed doesn't in locked price affect effect we But changes the an of don't SMS to in costs increases our were take on yes, the trusted is a infrastructure material improvements to as a and and underlying it short are environment. into pricing whether the inflationary additional our results we're U.S. evaluating well not still they'll other obviously we provide impact

the that customers, like to made us And it to just the sense environment. the it offer given given value felt current technology so we and

Ryan MacWilliams

really just up I quickly. follow

were of end around quarter beat with guidance Just guidance going philosophy your new forward on of is on commentary you high line. The million revenue, last the first what your like thinking a kind to this the about guidance? quarter rev $XX in line

Khozema Shipchandler

guidance better out. of that's and refine actual Yes, pretty QX the headed, to are where more wanted I did that to We consistent mentioned, approach. we investors as just way to guidance approximation provide mean, things a our we basically much. give played

Operator

line comes Wolfe question the next Research. Zukin of with Alex Your from

Alex Zukin

on up to follow pricing want first. I

environment? that strategic the a to So more course there life. if application of globally? strategic is over is the opportunity more this exercised onetime really to of kind the you we walk more about there pricing of think lever of the services? or a an think about company's here haven't around interaction with customer by to a Is it, it, this was tie kind the this this you inflationary way driven And if Just was through a adjustment do

Khozema Shipchandler

out a Yes. I plans of we one every lever. across think single it necessarily that Grandios globally our products. say mean or wouldn't I I it's to have roll

notably increases think business, times of them, We've we done I -- business. them example, other in just for our back, we necessarily also not the parts still in a have Segment. e-mail like in I evaluating done it's a been But the mean, SMS, but to been in ownership. in that. done most even past, take few maybe done price actually under stuff a step while have the we're They've

that's like not planned it's so before Twilio. hasn't in And it's something or not something that happened

leave want So with I that to don't impression. you

us, variable as I environment, like seeing said. enough like that well price I we think it based as felt our we're the cost increase, inflation for to both in line pass the on inflation through was appropriate labor

go it's are balance and year, how the changes the still XX, on are as out. fixed that of price a those it's take going be material there see play on things think of we'll contracts. but we While effect And the that to I something evaluate lot short we'll customers through don't in term, the

Alex Zukin

Perfect. the to half, year. there you about comparables or And second just anything then, you're Kash's the question environment. prior that all there to impacts any I out hopefully, and any adjustment verticals than see into then guess, the back any use bouncing the Like goes in from Russia where to others? respect the macro And favorable with your stronger out in from or more take you're as Ukraine? to This at called is back coming account doing maybe are of Europe pandemic, are cases separately, revenue starting we models

Khozema Shipchandler

Okay. There's there. a lot

take So at time. a one them let me

customers a in business pretty that of we wouldn't to fringes much global we Russia. we've minimis their that extent we Ukraine, business our haven't at impact yes, it's that a Volume traffic, an doing to And bit we've extent a have impact a can pretty the with traffic might modeled to then little around isolated de some we've it even is had and really the that. that is any. seen I there's any seen who So state-owned piece the tell Russia, say business. suspended in been date. all. new region for terminated on our with traffic Russia, But pause in I small What it our would us. to And material customers, any to And of you impact impact

macro, factors all broader watching you of I mean, the terms same we're In all that do.

that I seeing that to in done would what line, what of think is conversations customers, the we've research others boardroom what a we're what we're I revenue go what in back our seeing to in on and that priority. some we're with the our have top finding both based done transformation continues digital is remain ground

that's not one trend, secular very a as that see we so And cyclical.

that factors, to of cetera, are long Twilio. I over feel there's for a lot into largely there labor, but all chain, mean, is period a course, we And et here as economic so built supply continues tailwind our And geopolitics, that happen like time, models. stuff of of

next so I of we of question have those well. And strong a well say part our Alex, other there's and as as obviously profitable impacts remember XX% that. sheet a I'd your one lot plus has as balance can't in, year baked being growth confidence

Alex Zukin

stronger others? verticals The back coming that are are than

Khozema Shipchandler

share, back to pandemic, of were I reports I what like some nicely. the drives of based volume impacted recently, transpiring significantly And you've obviously, mean, those mean into the pretty on the hospitality seen to obviously, Yes. some coming bad. And saw additional pretty industries are we going travel, ride that kind even us.

mind to bear is now the we're in terms I customer very, very there thing our base. think that in diversified of

industry revenue And necessarily so line. one our an drives impact no on outsized

categories during and those I of of services. the care, to going. those health hearing of I customers the path But we're we in the digital is what in elevated. be things for now expect think significant cases that pandemic durable that that our think the from they've financial keep verticals lot they've became gone down want to A ROI, course are, the transformation seen e-commerce, saw quite use example, that we they such

be and And ready areas, team helping I with gotten lot different we them. so we've solve stand do in their verticals, problems to and able just are do that to customers Elena those her going started and with to those that there's think now more in a

a up on COVID. I'd part referenced joined bit those I the you, industries of talk with in questions everybody, of IR that available and it Thank we're So some welcome you tailwind bit tailwind that, those the going you Thank of questions as say of team in your soon. afterwards. we down we'll then who Operator, wrap earlier subsequently, I that as think were and and to the early is call. far very much, answers. Certainly, and a to

Operator

attending for you call. today's conference Thank

disconnect. may now You

We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.