TWILIO INC (TWLO) · Quarterly Report (10-Q) SEC Filing

PART I - FINANCIAL INFORMATION Item 1. Financial Statements TWILIO INC. Condensed Consolidated Balance Sheets (Unaudited) As of June 30,As of December 31, 20262025 (In thousands) ASSETS Current assets: Cash and cash equivalents$823,261 $682,335 1,833,069 1,788,007 Accounts receivable, net760,074 636,736 330,011 469,650 3,746,415 3,576,728 Property and equipment, net186,628 176,963 Operating right-of-use assets30,462 39,031 Equity method investment250,525 301,642 Intangible assets, net114,064 142,065 Goodwill5,292,457 5,291,787 Other long-term assets188,674 222,648 Deferred tax asset1,029,402 20,026 Total assets$10,838,627 $9,770,890 LIABILITIES AND STOCKHOLDERS EQUITY Current liabilities: Accounts payable$70,551 $85,089 Accrued expenses and other current liabilities557,698 608,119 Deferred revenue and customer deposits153,004 158,677 Operating lease liability, current29,433 35,123 810,686 887,008 Operating lease liability, noncurrent42,924 54,162 993,162 992,287 Other long-term liabilities14,047 15,887 1,860,819 1,949,344 Commitments and contingencies (Note 10) Stockholders equity: Preferred stock Class A common stock 154 152 Additional paid-in capital16,488,013 16,148,190 Accumulated other comprehensive (loss) income (5,270)15,668 Accumulated deficit(7,505,089)(8,342,464) Total stockholders equity8,977,808 7,821,546 Total liabilities and stockholders equity$10,838,627 $9,770,890 Six Months EndedJune 30,202520262025 Revenue$1,499,089 $1,228,425 $2,905,996 $2,400,888 773,223 625,685 1,495,886 1,216,581 725,866 602,740 1,410,110 1,184,307 273,317 243,495 535,483 497,790 216,802 220,724 428,668 432,837 118,430 101,532 220,976 193,609 32,771 32,771 641,320 565,751 1,217,898 1,124,236 84,546 36,989 192,212 60,071 (24,346)(25,222)(51,569)(44,693)15,326 21,825 37,115 44,798 (9,020)(3,397)(14,454)105 75,526 33,592 177,758 60,176 991,683 (11,169)979,590 (17,736)$1,067,209 $22,423 $1,157,348 $42,440 $6.99 $0.15 $7.59 $0.28 $6.68 $0.14 $7.29 $0.26 152,785,292 153,228,766 152,582,316 153,273,594 159,708,166 159,691,758 158,711,170 160,729,638 Six Months EndedJune 30,202520262025 Net income $1,067,209 $22,423 $1,157,348 $42,440 (1,122)(1,116)(11,191)3,942 391 15,821 (10,199)24,207 (222)(347)452 (2,132)(953)14,358 (20,938)26,017 $1,066,256 $36,781 $1,136,410 $68,457 Accumulated Other Comprehensive LossAccumulated DeficitTotal Stockholders' EquityAmount152,105,999 $152 16,294,528 $(4,317)$(8,506,279)$7,784,084 1,067,209 1,067,209 96,023 9,011 1,616,234 2 (3) (1)227,243 23,221 22,102 4,356 8,675 (1,122) (1,122)(495,726) (66,019)(66,019) 391 391 (222) (222) 148,225 153,571,872 $154 16,488,013 $(5,270)$(7,505,089)$8,977,808 Accumulated Other Comprehensive Income (Loss) Accumulated DeficitTotal Stockholders' EquityAmount152,411,346 $152 16,148,190 $15,668 $(8,342,464)$7,821,546 1,157,348 1,157,348 133,192 9,570 3,340,269 4 (358) (43)227,243 23,221 44,204 6,801 8,675 (11,191) (11,191)(2,584,024)(2) (319,973)(319,975) (10,199) (10,199) 452 452 291,603 153,571,872 $154 16,488,013 $(5,270)$(7,505,089)$8,977,808 Accumulated Other Comprehensive Income Accumulated DeficitTotal Stockholders' EquityAmount153,254,342 $153 15,625,545 $10,358 $(7,631,765)$8,004,291 22,423 22,423 225,709 2,384 1,631,186 2 (661) (85)253,298 20,757 22,102 2,237 (1,116) (1,116)(1,809,818)(1) (176,747)(176,748) 15,821 15,821 (347) (347) 154,305 153,576,158 $154 15,805,141 $24,716 $(7,786,089)$8,043,922 Accumulated Other Comprehensive (Loss) Income Accumulated DeficitTotal Stockholders' EquityAmount152,610,697 $153 15,476,124 $(1,301)$(7,522,010)$7,952,966 42,440 42,440 357,224 5,150 3,343,830 4 (1,084) (138)253,298 20,757 44,204 5,013 3,942 3,942 (3,032,011)(3) (306,519)(306,522) 24,207 24,207 (2,132) (2,132) 298,239 153,576,158 $154 15,805,141 $24,716 $(7,786,089)$8,043,922 June 30, 20262025(In thousands) Net income $1,157,348 $42,440 63,688 99,403 9,484 10,516 (4,093)(8,182)278,423 288,524 33,556 38,387 10,763 3,686 6,801 5,013 51,569 44,693 (944,097) 32,771 4,367 3,487 (133,652)(3,112)101,533 84,662 (49,412)(1,732)(551)(49,688)(14,462)(24,323)(52,851)(40,086)(5,674)(7,671)(17,768)(18,693)(2,152)802 525,591 468,126 (685) (491,492)(408,836)438,342 818,034 (33,383)(24,152)(7,218)(2,167)(94,436)382,879 (128)(4,228)(43)(138)(323,048)(323,249)32,791 25,907 (290,428)(301,708)140,727 549,297 682,534 431,437 $823,261 $980,734 $23,519 $13,088 $18,762 $18,813 $823,261 $969,229 11,505 $823,261 $980,734 Gross Unrealized GainsGross Unrealized Losses Less Than 12 MonthsAggregate Fair Value Level 1Level 2Level 3 Financial Assets:(In thousands) Cash and cash equivalents:$571,680 $ $ 571,680 $ $ $571,680 21,579 21,579 21,579 U.S. Treasury bills3,000 3,000 Total included in cash and cash equivalents596,259 21,579 596,259 Marketable securities:190,136 135 (710) 189,561 1,638,200 1,683 (5,605)1,634,278 1,634,278 Total debt securities1,828,336 1,818 (6,315)1,634,278 1,823,839 Equity securities9,230 9,230 Total marketable securities1,837,566 1,818 (6,315)1,634,278 1,833,069 Total financial assets$2,433,825 $1,818 $(6,315)773,471 $1,655,857 $ $2,429,328 Gross Unrealized GainsGross Unrealized Losses Less Than 12 MonthsGross Unrealized Losses More Than 12 MonthsAggregate Fair Value Level 1Level 2Level 3 Financial Assets:(In thousands) Cash and cash equivalents:$454,505 $ $ $ 454,505 $ $ $454,505 37,517 37,517 37,517 492,022 37,517 492,022 Marketable securities:249,396 1,190 (9) 250,577 1,523,935 9,360 (84)(1)1,533,210 1,533,210 Total debt securities1,773,331 10,550 (93)(1)1,533,210 1,783,787 Equity securities4,220 4,220 Total marketable securities1,777,551 10,550 (93)(1)1,533,210 1,788,007 Total financial assets$2,269,573 $10,550 $(93)$(1)709,302 $1,570,727 $ $2,280,029 Debt Securities The Company s primary objective when investing excess cash is preservation of capital, hence the Company s debt securities primarily consist of U.S. Treasury securities, high credit quality corporate debt securities and commercial paper. Because the Company views its debt securities as available to support current operations, it has classified all available for sale securities as short-term. Interest earned on debt securities was $17.8 million and $35.3 million in the three and six months ended June 30, 2026, respectively, and $17.9 million and $36.8 million in the three and six months ended June 30, 2025, respectively. The interest is recorded as other income, net, in the accompanying unaudited condensed consolidated statements of operations. 13 Table of Contents The following table summarizes the contractual maturities of debt securities: As of June 30,As of December 31, 20262025 Amortized CostAggregate Fair ValueAmortized CostAggregate Fair Value Financial Assets:(In thousands) Less than one year$737,062 $738,146 $588,022 $590,997 One to three years1,091,274 1,085,693 1,185,309 1,192,790 Total$1,828,336 $1,823,839 $1,773,331 $1,783,787 Strategic Investments As of June 30, 2026, and December 31, 2025, the Company held strategic investments with a carrying value of $24.2 million and $24.5 million, respectively, recorded as other long-term assets in the accompanying unaudited condensed consolidated balance sheets. There were no significant impairments or adjustments recorded in the three and six months ended June 30, 2026 and 2025 related to these securities. Financial Liabilities The Company s financial liabilities that are measured at fair value on a recurring basis consist of foreign currency derivative liabilities and are classified as Level 2 financial instruments in the fair value hierarchy. As of June 30, 2026, and December 31, 2025, the aggregate fair value of these liabilities and the associated unrealized losses were not significant. The Company s financial liabilities that are not measured at fair value on a recurring basis are its Senior Notes due 2029 ( 2029 Notes ) and its Senior Notes due 2031 ( 2031 Notes ). As of June 30, 2026, the fair values of the 2029 Notes and 2031 Notes were $487.6 million and $477.1 million, respectively. As of December 31, 2025, the fair values of the 2029 Notes and 2031 Notes were $489.7 million and $483.9 million, respectively. 4. Property and Equipment Property and equipment consist of the following: As of June 30,As of December 31, 20262025 (In thousands) Capitalized internal-use software developments costs$464,892 $421,795 Data center equipment 19,639 27,843 Leasehold improvements62,186 62,143 Office equipment47,902 46,709 Furniture and fixtures9,965 10,399 Software15,431 14,927 Total property and equipment620,015 583,816 Less: accumulated depreciation and amortization (433,387)(406,853) Total property and equipment, net$186,628 $176,963 Depreciation and amortization expense was $17.7 million and $22.3 million in the three months ended June 30, 2026 and 2025, respectively, and $34.6 million and $44.1 million in the six months ended June 30, 2026 and 2025, respectively. The Company capitalized $22.8 million and $17.6 million in internal use software development costs in the three months ended June 30, 2026 and 2025, respectively, and $46.1 million and $33.9 million in the six months ended June 30, 2026 and 2025, respectively. 14 Table of Contents 5. Derivatives and Hedging As of June 30, 2026, the Company s outstanding foreign currency forward contracts designated as cash flow hedges had a total sell notional value of $330.6 million. The notional value represents the amount that will be sold upon maturity of the forward contract. As of June 30, 2026, these contracts had maturities of up to seventeen months. Gains and losses associated with these foreign currency forward contracts were not significant. The Company is subject to master netting agreements with certain counterparties of the foreign exchange contracts, under which it is permitted to net settle transactions of the same currency with a single net amount payable by one party to the other. It is the Company s policy to present the derivatives at gross in its unaudited condensed consolidated balance sheets. The Company s foreign currency forward contracts are not subject to any credit contingent features or collateral requirements. The Company manages its exposure to counterparty risk by entering into contracts with a diversified group of major financial institutions and by actively monitoring its outstanding positions. As of June 30, 2026, the Company did not have any offsetting arrangements. 6. Goodwill and Intangible Assets Goodwill The goodwill balance as of June 30, 2026 and December 31, 2025, and the changes during the period, were as follows: Total (In thousands) Balance as of December 31, 2025 $5,291,787 Measurement period adjustment and other 670 $5,292,457 CostAccumulated AmortizationNet Amortizable intangible assets:(In thousands) Developed technology$398,205 $(370,302)$27,903 Customer relationships350,283 (272,686)77,597 Supplier relationships49,756 (48,983)773 Trade names25,968 (25,968) 3,968 (1,392)2,576 Total amortizable intangible assets828,180 (719,331)108,849 Non-amortizable intangible assets: Telecommunication licenses4,920 4,920 Trademarks and other295 295 Total$833,395 $(719,331)$114,064 15 Table of Contents Accumulated AmortizationNet(In thousands)$398,205 $(359,450)$38,755 350,283 (260,216)90,067 49,756 (44,443)5,313 25,968 (25,928)40 3,968 (1,293)2,675 828,180 (691,330)136,850 4,920 4,920 295 295 $833,395 $(691,330)$142,065 Year Ended December 31,(In thousands) 2026 (remaining six months)$16,614 202727,796 202821,520 202917,353 203016,614 Thereafter8,952 Total$108,849 7. Balance Sheet Components Prepaid expenses and other current assets consist of the following: As of June 30,As of December 31, 20262025 (In thousands) Prepaid expenses(1) $223,615 $307,263 Other current assets106,396 162,387 Total prepaid expenses and other current assets $330,011 $469,650 ____________________________________ (1) In the three months ended June 30, 2026, the Company recorded a $32.8 million impairment loss on prepaid assets, which contributed to a decrease in prepaid expenses from December 31, 2025. The impairment loss was due to the Company s determination that it would be unable to consume certain network services that were prepaid in previous periods due to operational and financial challenges experienced by two network service providers. 16 Table of Contents Accrued expenses and other current liabilities consist of the following: As of June 30,As of December 31, 20262025 (In thousands) Accrued payroll and related liabilities$87,912 $95,795 Company-wide bonus program liability76,184 136,221 Accrued sales bonus and commissions14,742 21,922 Accrued cost of revenue254,004 226,878 Sales and other taxes payable57,053 58,259 ESPP contributions5,376 6,925 62,427 62,119 Total accrued expenses and other current liabilities$557,698 $608,119 8. Long-Term Debt Long-term debt, net, consists of the following: As of June 30,As of December 31, 20262025 (In thousands) 2029 Senior Notes Principal$500,000 $500,000 Unamortized discount(2,329)(2,733) Unamortized issuance costs(524)(615) Net carrying amount497,147 496,652 2031 Senior Notes Principal500,000 500,000 Unamortized discount(3,253)(3,563) Unamortized issuance costs(732)(802) Net carrying amount496,015 495,635 Total long-term debt, net$993,162 $992,287 As of June 30, 2026, the Company was in compliance with all of its covenants under the related indentures. 9. Revenue by Geographic Area Revenue by geographic area is based on the IP address or the mailing address of the customer at the time of registration. The following table sets forth revenue by geographic area: Six Months Ended June 30,202520262025(In thousands) United States$961,352 $786,974 $1,860,246 $1,536,414 537,737 441,451 1,045,750 864,474 $1,499,089 $1,228,425 $2,905,996 $2,400,888 64 %64 %64 %64 %36 %36 %36 %36 %As of December 31, 20262025 Stock options issued and outstanding767,453 902,120 Unvested restricted stock units issued and outstanding12,168,065 13,663,977 Shares of Class A common stock reserved for Twilio.org221,021 265,225 Stock-based awards available for grant under 2016 equity plan10,529,415 28,543,969 Shares of Class A common stock reserved for issuance pursuant to ESPP(1) 12,133,808 10,836,938 Total35,819,762 54,212,229 ____________________________________ (1) The amount as of June 30, 2026 reflects the number of shares of Class A common stock reserved for issuance pursuant to the ESPP governing the current offering period as of that date. See Note 12 for further details. Share Repurchase Program In January 2025, the board of directors of the Company authorized a share repurchase program to repurchase up to $2.0 billion in aggregate value of the Company s outstanding Class A common stock. Repurchases under this program can be made through open market, private transactions or other means, in compliance with applicable federal securities laws, and can include repurchases pursuant to Rule 10b5-1 trading plans. The Company has discretion in determining the conditions under which shares may be repurchased from time to time. The program expires on December 31, 2027. In the three months ended June 30, 2026 and 2025, the Company repurchased 0.5 million and 1.8 million shares of its Class A common stock, respectively, for an aggregate purchase price of $66.0 million and $176.7 million, respectively. In the six months ended June 30, 2026 and 2025, the Company repurchased 2.6 million and 3.0 million shares of its Class A common stock, respectively, for an aggregate purchase price of $319.4 million and $306.9 million, respectively. As of June 30, 2026, approximately $826.0 million of the amount authorized in January 2025 for share repurchases remained available for future repurchases. 12. Stock-Based Compensation Stock Option and Incentive Plan The Company s 2016 Stock Option and Incentive Plan (the Prior Equity Plan ) that originally became effective on June 21, 2016, and was scheduled to expire in June 2026, was amended on June 16, 2026 (the Amendment Date ), pursuant to the Company s stockholders approval. The amended 2016 Stock Option and Incentive Plan (the Amended Equity Plan ) superseded the Prior Equity Plan and will expire on June 16, 2036. As of its effective date, the Amended Equity Plan reduced the number of shares reserved for issuance under the plan to a maximum of 10,500,000 shares of the Company s Class A common stock, which will be increased by the amount of any shares subject to awards granted under the Amended Equity Plan (or the Prior Equity Plan prior to the Amendment Date) that are forfeited, canceled, reacquired by the Company prior to vesting 19 Table of Contents or otherwise terminated. The Amended Equity Plan does not provide for automatic annual increases of available shares in the plan. The types of awards permitted for granting under the Amended Equity Plan remain unchanged and include stock options, restricted stock units ( RSUs ), restricted stock awards, stock appreciation rights, unrestricted stock awards, performance share awards, dividend equivalent rights and cash-based awards by the Company to be granted to its employees, directors and consultants. Certain of the Company s outstanding equity awards were granted under equity incentive plans that are no longer active but continue to govern the outstanding equity awards granted thereunder. Employee Stock Purchase Plan The Company s 2016 Employee Stock Purchase Plan (the Prior ESPP ) that originally became effective on June 21, 2016, and was scheduled to expire in June 2026, was amended on June 16, 2026, pursuant to the Company's stockholders approval. The amended 2016 Employee Stock Purchase Plan (the Amended ESPP ) superseded the Prior ESPP and will remain effective until terminated by the Company s board of directors in its discretion. As of its effective date, the Amended ESPP reduced the number of shares reserved for issuance thereunder to a maximum of 4,000,000 shares of the Company s Class A common stock. The Amended ESPP does not provide for automatic annual increases of available shares in the plan. Both the Prior ESPP and the Amended ESPP allow eligible employees to purchase shares of the Company s Class A common stock at a discount of 15% through payroll deductions of their eligible compensation, and provide for separate six-month offering periods beginning in May and November of each year. The initial offering under the Amended ESPP will begin on November 16, 2026, following the conclusion of the current six-month offering period that commenced in May 2026 under the Prior ESPP. On each purchase date, eligible employees purchase shares of the Company s Class A common stock at a price per share equal to 85% of the lesser of (i) the fair market value of the Company s Class A common stock on the offering date or (ii) the fair market value of the Company s Class A common stock on the purchase date. Performance-Based Restricted Stock Units In the first quarter of 2026, the Company granted to certain of its executive employees performance-based restricted stock units ( PSUs ) covering 210,301 shares of Class A common stock that had an aggregate grant date fair value of $24.8 million. The PSUs will vest if certain operational performance conditions, as defined in the grant agreements, are met during the three-year performance achievement period, which expires on December 31, 2028. Additionally, if certain market conditions are met during the performance achievement period, the number of shares that ultimately vest may further increase or decrease. At the end of the vesting period, the number of shares actually issued may range from 0% to 200% of the target based on levels of performance. The fair value of the PSUs was determined using a Monte-Carlo simulation model. The expense is recognized on a straight-line basis when it is probable that the performance target will be achieved during the performance period. The probability of achievement is assessed each reporting period and cumulative adjustments are recorded in periods in which the probability assessment changes. 20 Table of Contents As of June 30, 2026, total unrecognized compensation cost related to unvested RSUs, including PSUs, was $1.1 billion, which will be amortized over a weighted-average period of 2.2 years. As of June 30, 2026, total unrecognized compensation cost related to the ESPP was not significant. Stock-Based Compensation Expense The Company recorded total stock-based compensation expense as follows: Six Months Ended June 30,202520262025 Cost of revenue$3,111 $4,087 $6,485 $8,358 74,702 80,590 147,713 158,656 32,299 34,413 63,448 65,772 31,800 30,161 60,777 55,738 $141,912 $149,251 $278,423 $288,524 Six Months Ended June 30,202520262025$1,067,209 $22,423 $1,157,348 $42,440 152,785,292 153,228,766 152,582,316 153,273,594 6,922,874 6,462,992 6,128,854 7,456,044 159,708,166 159,691,758 158,711,170 160,729,638 $6.99 $0.15 $7.59 $0.28 $6.68 $0.14 $7.29 $0.26 Six Months Ended June 30,202520262025132,180 414,972 132,180 145,350 2,286,140 4,458,044 2,286,140 4,261,767 90,584 148,220 90,584 148,220 2,508,904 5,021,236 2,508,904 4,555,337 2025$1,499,089 $1,228,425 22 %13 %116 %108 %Six Months EndedJune 30,202520262025(In thousands, except share and per share amounts) Revenue$1,499,089 $1,228,425 $2,905,996 $2,400,888 773,223 625,685 1,495,886 1,216,581 725,866 602,740 1,410,110 1,184,307 273,317 243,495 535,483 497,790 216,802 220,724 428,668 432,837 118,430 101,532 220,976 193,609 32,771 32,771 641,320 565,751 1,217,898 1,124,236 84,546 36,989 192,212 60,071 (24,346)(25,222)(51,569)(44,693)15,326 21,825 37,115 44,798 (9,020)(3,397)(14,454)105 75,526 33,592 177,758 60,176 991,683 (11,169)979,590 (17,736)$1,067,209 $22,423 $1,157,348 $42,440 $6.99 $0.15 $7.59 $0.28 $6.68 $0.14 $7.29 $0.26 152,785,292 153,228,766 152,582,316 153,273,594 159,708,166 159,691,758 158,711,170 160,729,638 Six Months EndedJune 30,202520262025 Cost of revenue$3,111 $4,087 $6,485 $8,358 74,702 80,590 147,713 158,656 32,299 34,413 63,448 65,772 31,800 30,161 60,777 55,738 $141,912 $149,251 $278,423 $288,524 Six Months EndedJune 30,202520262025 Cost of revenue$6,037 $15,594 $15,393 $31,276 5,248 11,411 12,509 22,868 $11,285 $27,005 $27,902 $54,144 Six Months EndedJune 30,202520262025100%100%100%100%5251515148494949182018211418151888882 1 434642476373(2)(2)(2)(2)1212(1)***536366(1)34(1)71%2%40%2%2025 $1,499,089 $1,228,425 270,664 22 % June 30, 20262025Change (Dollars in thousands) Cost of revenue$773,223 $625,685 $147,538 24 % Gross profit $725,866 $602,740 $123,126 20 % In the three months ended June 30, 2026, cost of revenue increased by $147.5 million, or 24%, compared to the same period last year. The increase was primarily attributable to a $138.8 million increase in network service provider costs, net of the impact of hedging instruments, which includes a $71.1 million increase due to the incremental A2P fees recently introduced by major U.S. carriers. In the three months ended June 30, 2026, gross profit increased by $123.1 million, or 20%, compared to the same period last year. This increase was attributable to the factors impacting our revenue and cost of revenue, as described above. Operating Expenses 2025 Research and development$273,317 $243,495 29,822 12 %216,802 220,724 (2)%118,430 101,532 17 %32,771 NM$641,320 $565,751 75,569 13 %2025$(24,346)$(25,222)876 3 %15,326 21,825 (30)%$(9,020)$(3,397)(5,623)166 %2025 $991,683 $(11,169)1,002,852 NM2025 $2,905,996 $2,400,888 505,108 21 % June 30, 20262025Change (Dollars in thousands) Cost of revenue$1,495,886 $1,216,581 $279,305 23 % Gross profit $1,410,110 $1,184,307 $225,803 19 % In the six months ended June 30, 2026, cost of revenue increased by $279.3 million, or 23%, compared to the same period last year. This increase was primarily attributable to a $257.0 million increase in network service providers costs, net of the impact of hedging instruments, which includes a $117.1 million increase due to the incremental A2P fees recently introduced by major U.S. carriers. In the six months ended June 30, 2026, gross profit increased by $225.8 million, or 19%, compared to the same period last year. The increase was attributable to the factors impacting our revenue and cost of revenue, as described above. Operating Expenses 2025 Research and development$535,483 $497,790 37,693 8 %428,668 432,837 (1)%220,976 193,609 14 %32,771 NM$1,217,898 $1,124,236 93,662 8 %2025 Share of losses from equity method investment$(51,569)$(44,693)(6,876)15 %37,115 44,798 (17)%$(14,454)$105 (14,559)NM2025 Benefit from (provision for) income taxes $979,590 $(17,736)997,326 NM2025(In thousands) GAAP gross profit$725,866 $602,740 48 %49 %3,111 4,087 6,037 15,594 696 481 $735,710 $622,902 49 %51 %2025(In thousands) GAAP operating expenses$641,320 $565,751 (138,801)(145,164)(5,248)(11,411)(32) (9,143)(4,440)(4,356)(2,237)108 (140)(32,771) $451,077 $402,359 2025(In thousands) GAAP income from operations $84,546 $36,989 6 %3 %141,912 149,251 11,285 27,005 32 9,839 4,921 4,356 2,237 (108)140 32,771 $284,633 $220,543 19 %18 %2025(In thousands) Net cash provided by operating activities$372,385 $277,084 25 %23 %(16,675)(12,588)(3,065)(1,004)$352,645 $263,492 24 %21 %$(53,246)$402,019 $(37,854)$(175,914) 20262025 Cash provided by operating activities $525,591 $468,126 (94,436)382,879 (290,428)(301,708)$140,727 $549,297 Average Price Paid Per Share(2) Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs(1) (In millions)496 $133.18 $826 $ $826 $ $826 Exhibit NumberIncorporated by Reference DescriptionFormFile No.ExhibitFiling Date 10.1+Twilio Inc. Amended and Restated 2016 Stock Option and Incentive Plan, and forms of agreement thereunder 8-K10.1June 17, 2026 10.2+Twilio Inc. Amended and Restated 2016 Employee Stock Purchase Plan 8-K10.2June 17, 2026 10.3+Twilio Inc. Amended and Restated Non-Employee Directors Deferred Compensation Program Filed herewith 31.1Certification of the Chief Executive Officer pursuant to Exchange Act Rules 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 31.2Certification of the Chief Financial Officer pursuant to Exchange Act Rules 13a-14(a) or 15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 Filed herewith 32.1* Certification of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Furnished herewith 101.INSInline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL documentFiled herewith 101.SCHInline XBRL Taxonomy Extension Schema DocumentFiled herewith 101.CALInline XBRL Taxonomy Extension Calculation Linkbase DocumentFiled herewith 101.DEFInline XBRL Taxonomy Extension Definition Linkbase DocumentFiled herewith 101.LABXBRL Taxonomy Extension Label Linkbase DocumentFiled herewith 101.PREInline XBRL Taxonomy Extension Presentation Linkbase DocumentFiled herewith 104Cover Page with Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101) __________________________________________ + Indicates a management contract or compensatory plan or arrangement. * The certifications furnished in Exhibit 32.1 hereto are deemed to accompany this Quarterly Report on Form 10-Q and will not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, except to the extent that the registrant specifically incorporates it by reference. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. TWILIO INC. August 7, 2026/s/ KHOZEMA Z. SHIPCHANDLER Khozema Z. Shipchandler Director and Chief Executive Officer (Principal Executive Officer) August 7, 2026/s/ AIDAN VIGGIANO Aidan Viggiano Chief Financial Officer (Principal Accounting and Financial Officer) 74