Joining me today are Khozema Shipchandler, Chief Executive Officer, Aidan Viggiano, Chief Financial Officer, and Thomas Wyatt, Chief Revenue Officer. Definitions and reconciliations between our GAAP and non-GAAP results can be found in our earnings presentation posted on our IR website at investors.twilio.com. We will also make forward-looking statements on this call, including statements about our future, outlook, and goals. Twilio had a great Q4 as we reached record heights with $1.4 billion in revenue, $256 million of non-GAAP income from operations, and $256 million in free cash flow.

For the full-year, we generated $5.1 billion in revenue, $924 million of non-GAAP income from operations, and $945 million of free cash flow. Reflecting on 2025, Twilio stood out with accelerating revenue growth, expanding operating margins, and by delivering significant growth in free cash flow. In Q4, we saw particular strength in self-serve as revenue grew 28% year-over-year, led by accelerating voice revenue growth. Twilio sent 6.99 billion messages, a 34.5% year-over-year increase, handled 1.07 billion calls, up 58% year-over-year, and processed 75.1 billion emails, a 14.6% increase year-over-year.

Voice year-over-year revenue growth accelerated throughout the year, with customers adopting products like Branded Calling, conversation relay, and conversational intelligence. Additionally, they will use voice software products like conferencing to support additional use cases like multi-party calling or taking payment over the phone. While still early days, during Q4, Twilio's Branded Calling revenue grew roughly 6x year-over-year. We generated record revenue of $1.4 billion, up 14% year-over-year on a reported basis, and 12% year-over-year on an organic basis.

What went well
  • Twilio capped fiscal 2025 with a record fourth quarter of $1.4 billion in revenue (up 14% reported, 12% organic), record non-GAAP income from operations of $256 million (up 30% year-over-year), and $256 million of free cash flow.
  • For the full year the company generated $5.1 billion in revenue (14% reported, 13% organic growth), $924 million of non-GAAP income from operations (up 29%), and $945 million of free cash flow (up 44%), and delivered its first-ever full year of GAAP operating profitability at $158 million.
  • The number of large deals of $500,000 or more rose 36% year-over-year, including a nine-figure renewal that was the largest deal in Twilio's history, and multi-product customer count grew 26%.
  • Voice growth accelerated to the high teens (its best rate since 2022) with voice AI revenue up more than 60%, and Cyber Week set records of 6.99 billion messages and 1.07 billion calls.
  • Twilio repurchased $855 million of stock for the year (about 90% of free cash flow), drove stock-based compensation down to 11.3% of Q4 revenue, and set a 2027 non-GAAP operating income target of at least $1.23 billion.
What went wrong
  • Non-GAAP gross margin fell 200 basis points year-over-year to 49.9%, pressured by $23 million of Verizon A2P carrier pass-through fees, and the dollar-based net expansion rate was a still-modest 109%.
  • Growth was uneven across products for the year, with Segment up only 2% and Email up 7%, well behind messaging (18%) and voice (13%), and Q4 GAAP income from operations was just $57 million.
  • Initial full-year 2026 guidance of 8%-9% organic growth implied a deceleration from 2025, first-quarter 2026 free cash flow was expected to be limited to about $100 million due to a $140 million bonus payment, and incremental carrier fees were projected to cut roughly 170 basis points from 2026 non-GAAP gross margin.

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Reported 2026-02-12 · figures from the Twilio Inc Q4 2025 earnings call.

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