Twilio reported third-quarter revenue of $1.56 billion, up 20% year over year, surpassing analyst estimates of $1.52 billion. Net income surged 333% to $161 million, according to MarketWatch. Despite the strong results, the company issued a cautious outlook for the fourth quarter, expecting slower revenue growth.
Shares of Twilio (TWLO) dropped more than 15% in after-hours trading following the report, as investors focused on the weaker guidance. The stock reaction highlights growing concerns about a potential slowdown in cloud and API spending, a key driver of Twilio's business.
Twilio Q3 2026 earnings: key numbers
Twilio's third-quarter results beat Wall Street's expectations on both revenue and profitability, but the forward-looking guidance overshadowed the beat. The company's net income saw a massive jump, though the year-over-year comparison is influenced by a low base from the prior year.
- Revenue: $1.56 billion, up 20% year over year, vs. $1.52 billion expected
- Net income: $161 million, up 333% year over year
- Q4 outlook: slower revenue growth expected
- Stock reaction: TWLO down 15%+ after hours
What Twilio's guidance says about cloud and API demand
Twilio's downbeat fourth-quarter forecast could signal a broader deceleration in demand for cloud-based communication tools and APIs. The company provides programmable messaging, voice, and email services that many businesses rely on, making its outlook a bellwether for the sector.
