Twilio beat revenue forecasts and raised its full-year outlook, yet its stock fell more than 15% after hours because investors worry about slower growth ahead.
Twilio had a strong quarter, and its stock still dropped more than 15% in after-hours trading. Third-quarter revenue rose 20% from a year ago to $1.56 billion. Analysts had expected about $1.52 billion. The company also said it expects slower revenue growth in the fourth quarter, and investors reacted to that.
After-hours trading happens after the regular stock market closes, and prices can move sharply on earnings news. Here, the pattern is clear. The past quarter looked good, but the forecast for the next one pointed to slower growth. Investors often care more about where a company is headed than where it has been.
Twilio is one of the companies behind the tools that let businesses text or call customers through apps. If your business relies on that kind of service, this is a look at how investors judge the companies that supply it.
The material does not say how much slower Twilio expects fourth-quarter growth to be. It also does not explain why the outlook disappointed investors, or whether the drop will hold when regular trading opens.
A company can beat forecasts and still be punished by investors if its outlook for the next quarter points to slower growth.
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