SAN FRANCISCO (Reuters) - Cloud communications technology company Twilio Inc (TWLO.N) on Tuesday forecast fourth quarter revenue ahead of Wall Street targets and exceeded third quarter expectations for results, sending shares up 12 percent.
Companies including Airbnb and Uber use Twilio technology to send texts and other communications to customers. Last month Twilio announced it was buying email technology firm SendGrid Inc SEND.N in an all-stock deal valued at about $2 billion.
Developers prefer to use Twilio to handle communications while focusing their own efforts on core application tasks.
Twilio’s third quarter revenue rose 68 percent to $168.90 million, ahead of the $150.45 million average estimate of 18 analysts according to IBES data from Refinitiv. This is at least the ninth quarter the company had an upside surprise on revenue.
Pat Walravens, an analyst for JMP Securities, told Reuters by email that Twilio’s quarterly revenue growth rate was the fastest of more than 50 software companies covered at JMP, thanks to its focus on developers.
GAAP loss in the period widened to $25 million for the third quarter from a loss of $24 million in the same period last year. Twilio posted non-GAAP income of $4.3 million, up from a loss of $7.7 million in the third quarter last year. The non-GAAP earnings per share of 7 cents topped Wall Street’s target of 2 cents.
The company on Tuesday forecast that revenue for the fourth quarter would be between $183 million and $185 million, higher than analysts estimates of $161.36 million.
WhatsApp continued to be the biggest revenue generator in the third quarter for Twilio, making up 6 percent of revenue, followed by Uber which accounted for 4 percent. Twilio’s technology is used by WhatsApp for mobile phone number verification when users sign up.
Twilio CEO Jeff Lawson said on a conference call with analysts that the bulk of the growth still came from its voice and messaging products.
Shares rose to $79.86 in after hours trade from a close of $71.02.
Reporting by Jane Lanhee Lee; editing by Peter Henderson and Grant McCool