TWLO Q2 2026 Earnings

Call Details

• Call Title: Twilio Inc. Q2 2026 Earnings Call
• Date: August 6, 2026 at 9:00 PM UTC
• Management Team:
  • Khozema Shipchandler (Chief Executive Officer)
  • Aiden Viggiano (Chief Financial Officer)
  • Thomas

Call Summary

Financial Performance

• Q2 non-GAAP gross profit was $736M, with non-GAAP gross profit growth accelerating to 18% year-over-year.
• Q2 non-GAAP gross margin was 49.1%, which declined 160 basis points year-over-year and 50 basis points quarter-over-quarter due to incremental carrier fees of $71M.
• Q2 non-GAAP income from operations was $285M, which represents a 29% year-over-year increase.
• Q2 non-GAAP operating margin was 19%, which was up 100 basis points year-over-year and down 80 basis points quarter-over-quarter and included roughly a 90 basis point headwind from incremental U.S. carrier fees.
• GAAP income from operations was $85M and was impacted by a $33M prepaid asset impairment that did not affect non-GAAP results or free cash flow.
• GAAP net income was positively affected by a one-time non-cash $944M valuation allowance release against certain deferred tax assets and did not impact non-GAAP results.
• Q2 stock-based compensation was 9.5% of revenue, down 270 basis points year-over-year and down 20 basis points quarter-over-quarter.
• Q2 free cash flow was a record $353M for the quarter.

Guidance

• Q3 revenue guidance is $1.505B to $1.515B, representing 16% to 16.5% reported growth and 11% to 12% organic growth.
• Q3 reported revenue guidance assumes $56M in incremental U.S. carrier fees that are excluded from organic revenue.
• Full-year organic revenue growth range was raised to 13% to 13.5% from prior 9.5% to 10.5%.
• Full-year reported revenue growth range was raised to 18% to 18.5% from prior 14% to 15%.
• Full-year guidance assumes approximately $250M in incremental US carrier pass-through revenue, which is expected to reduce full-year 2026 non-GAAP gross margin by roughly 210 basis points versus 2025, all else equal.
• Q3 non-GAAP income from operations is expected to be $285M to $295M.
• Full-year non-GAAP income from operations guidance was raised to $1.135B to $1.155B from $1.08B to $1.10B previously.
• Full-year free cash flow guidance was raised to $1.135B to $1.155B.