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. We delivered $1.5 billion in revenue, accelerating organic growth to 17% year-over-year, while non-GAAP gross profit growth also accelerated to 18% year-over-year.

We generated $285 million in non-GAAP income from operations and $353 million in free cash flow. Customers who engage with Carla convert to approved leads 1.6 times faster, delivering a multimillion-dollar annual revenue uplift across their core commission and ancillary offerings. We continue to see strength across the business, highlighted by robust messaging growth, even as carriers have raised their fees on our customers. Our go-to-market focus on multi-product adoption is working well, and we saw continued strength across our platform, including messaging, voice, and software add-ons during the quarter.

Revenue growth from multi-product customers is accelerating, illustrating that our customers are continuing to use multiple products within the Twilio platform to power personal multi-channel communications. Atlassian, a leading provider of AI-powered collaboration and team productivity software, utilizes Twilio's communications infrastructure to deliver contextual, AI-powered, omni-channel support within its new customer service management app. Twilio had an exceptional Q2, delivering record revenue of $1.5 billion, up 22% year-over-year on a reported basis, and 17% year-over-year on an organic basis, which excludes incremental U.S. We also generated record non-GAAP income from operations of $285 million and record free cash flow of $353 million.

What went well
  • Twilio delivered a record second quarter with revenue of $1.5 billion, up 22% year-over-year on a reported basis and accelerating to 17% organic growth, while non-GAAP gross profit growth accelerated to 18%, its fifth consecutive quarter of accelerating gross profit growth.
  • Profitability and cash generation hit records, with non-GAAP income from operations of $285 million (up 29% year-over-year) and record free cash flow of $353 million; the dollar-based net expansion rate rose to 116%.
  • Product momentum was strong: the next-generation Conversations layer reached general availability at SIGNAL, the redesigned Console drove a 90%+ conversion uplift versus the old console, messaging grew 28%, voice grew above 20%, and Verify accelerated to 30%+.
  • Go-to-market execution produced an eight-figure deal with a leading AI company plus wins with Atlassian, Olo, Eltropy and others, and Twilio was named a leader in the 2026 Gartner CPaaS Magic Quadrant (highest in ability to execute).
  • Management sharply raised full-year guidance, lifting organic revenue growth to 13%-13.5% (from 9.5%-10.5%), reported growth to 18%-18.5%, and non-GAAP income from operations to $1.135 billion-$1.155 billion; a one-time non-cash tax benefit of $944 million was recognized from a deferred-tax valuation allowance release.
What went wrong
  • Non-GAAP gross margin fell 160 basis points year-over-year to 49.1% and declined 50 basis points sequentially, driven by $71 million of incremental U.S. carrier pass-through fees; excluding those fees, gross margin would have risen 60 basis points year-over-year.
  • GAAP income from operations was only $85 million and was reduced by a $33 million prepaid asset impairment, and non-GAAP operating margin declined 80 basis points sequentially, carrying a roughly 90 basis point headwind from incremental carrier fees.
  • Management acknowledged the rising carrier pass-through fees create real cost pressure for customers, particularly small businesses, even though the fees do not affect Twilio's own profitability.

More on Twilio Inc

Reported 2026-08-06 · figures from the Twilio Inc Q2 2026 earnings call.

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