Twilio Inc (TWLO)

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Twilio Announces Fourth Quarter and Full Year 2022 Results
February 15 2023 - 04:05PM

Fourth Quarter Revenue of $1.02 billion, up 22% Year-Over-Year

Moving to a Business Unit structure and announcing four executive updates
Authorized a $1.0 billion share repurchase program
Reduced workforce by 17% and further rationalizing cost base

https://ih.advfn.com/stock-market/NYSE/twilio-TWLO/stock-news/90256733/twilio-announces-fourth-quarter-and-full-year-2022

Twilio (NYSE: TWLO), the customer engagement platform that drives real-time, personalized experiences for today’s leading brands, today reported financial results for its fourth quarter and full year ended December 31, 2022.

“This week, we announced meaningful changes to Twilio’s leadership group, organizational structure, team size and capital allocation strategy that will both accelerate our path to profitability and most importantly, improve our execution in delivering our Engagement Platform strategy for our customers,” said Jeff Lawson. “While our vision remains, the way we operate and execute has changed — all in service of driving better focus for the business and ultimately enhancing value creation for our shareholders.”

Fourth Quarter 2022 Financial Highlights

Revenue of $1.02 billion for the fourth quarter of 2022, up 22% year-over-year. Organic revenue grew 21% year-over-year.

GAAP loss from operations of $218.6 million for the fourth quarter of 2022, compared with GAAP loss from operations of $283.6 million for the fourth quarter of 2021.

Non-GAAP income from operations of $32.9 million for the fourth quarter of 2022, compared with non-GAAP loss from operations of $27.2 million for the fourth quarter of 2021.

GAAP net loss per share attributable to common stockholders, basic and diluted, of $1.24 based on 185.1 million weighted average shares outstanding in the fourth quarter of 2022, compared with GAAP net loss per share attributable to common stockholders, basic and diluted, of $1.63 based on 178.9 million weighted average shares outstanding in the fourth quarter of 2021.

Non-GAAP net income per share attributable to common stockholders, diluted, of $0.22 based on 187.2 million non-GAAP weighted average shares outstanding in the fourth quarter of 2022, compared with non-GAAP net loss per share attributable to common stockholders, diluted, of $0.20 based on 178.9 million non-GAAP weighted average shares outstanding in the fourth quarter of 2021.

Full Year 2022 Financial Highlights

Revenue of $3.83 billion for the full year 2022, up 35% year-over-year. Organic revenue for the full year grew 30% year-over-year.

GAAP loss from operations of $1.2 billion for the full year 2022, compared with GAAP loss from operations of $915.6 million for the full year 2021.

Non-GAAP loss from operations of $4.5 million for the full year 2022 compared with non-GAAP income from operations of $2.5 million for the full year 2021.

GAAP net loss per share attributable to common stockholders, basic and diluted, of $6.86 based on 183.0 million weighted average shares outstanding in the full year 2022, compared with GAAP net loss per share attributable to common stockholders, basic and diluted, of $5.45 based on 174.2 million weighted average shares outstanding in the full year 2021.
Non-GAAP net loss per share attributable to common stockholders, basic and diluted, of $0.15 based on 183.0 million non-GAAP weighted average shares outstanding in the full year 2022, compared with non-GAAP net loss per share attributable to common stockholders, basic and diluted, of $0.25 based on 174.2 million non-GAAP weighted average shares outstanding in the full year 2021.

Key Metrics

More than 290,000 Active Customer Accounts as of December 31, 2022, compared to more than 256,000 Active Customer Accounts as of December 31, 2021.

Dollar-Based Net Expansion Rate was 110% for the fourth quarter of 2022, compared to 126% for the fourth quarter of 2021. Results from acquisitions closed after October 1, 2021, do not impact the calculation of this metric in either period. For the full year 2022, Dollar-Based Net Expansion Rate was 121%.

8,156 employees as of December 31, 2022.

Workforce Reduction

On Monday, February 13, Twilio announced the decision to reduce its workforce by approximately 17%, as well as pursue further expense rationalization. Leadership believes these changes will drive meaningful cost savings, and in conjunction with this announcement, Twilio has updated its Financial Framework to reflect a range for 2023 non-GAAP operating profit, as well as accelerated non-GAAP operating margin improvements and lowered stock-based compensation as a percentage of revenue in the medium term, which we define as fiscal years 2025 through 2027.

Organizational and Leadership Updates

Twilio also announced that moving forward, it will operate two separate business units: Twilio Communications, led by Khozema Shipchandler, and Twilio Data & Applications, led by Elena Donio. This strategic realignment enables Twilio to better execute on the key priorities for each business – driving efficiencies for Twilio Communications and accelerating growth for Twilio Data & Applications – while taking into consideration each business unit’s unique economic, customer, and product needs. Additionally, it was announced that Aidan Viggiano is being promoted to the role of Chief Financial Officer. Aidan joined Twilio in 2019 and has led the FP&A function for the past 1.5 years. She is a world-class leader and executive. These leadership changes will go into effect as of March 1, 2023. And finally, Eyal Manor has decided to leave Twilio, and will be stepping down from his position as Chief Product Officer effective February 28, 2023.

Share Repurchase Program

Twilio announced today that its Board of Directors has authorized a share repurchase program of up to $1.0 billion of Twilio’s outstanding Class A common stock. Under the program, Twilio may purchase shares from time to time through open market transactions, privately negotiated transactions, and other means in compliance with applicable securities laws, including through Rule 10b5-1 plans. The program is set to expire on December 31, 2024. The timing, manner, price and amount of any repurchases, are determined by Twilio at its discretion and depend on a variety of factors, including legal requirements, price and economic market conditions.

Outlook

Twilio is initiating guidance for the first quarter ending March 31, 2023 and fiscal year 2023.

Q1 FY23 Guidance

Revenue (millions) $995 - $1,005

Y/Y Growth 14% - 15%

Organic Y/Y Growth 13% - 14%

Non-GAAP profit from operations (millions) (1)$45 - $55

Non-GAAP profit per share (2) $0.18 - $0.22

Non-GAAP weighted average diluted shares outstanding (millions) 188

FY23 Guidance

Non-GAAP profit from operations (millions) (1) $250 - $350


(1)Includes an estimated $10 million one-time, non-cash benefit for termination of the employee sabbatical program.

(2)Non-GAAP profit per share guidance assumes no impact from volatility of foreign exchange rates.