It's time for Twilio (NYSE:TWLO) to get back on track. The fast-growing provider of cloud-based communications solutions reports quarterly results after the market close tomorrow, and there's a lot riding on the numbers. 

Twilio stock has more than doubled since going public at $15 back in June, but by late September, the stock had actually more than quadrupled when it peaked at $70.96. The shares have gone on to surrender more than half of their value.

The volatility is there, but it hasn't necessarily been a roller coaster around earnings report. The stock rose a mere 1% after its second-quarter report, only to slide by 3% the day after posting its third-quarter financials. Tuesday will be Twilio's third earnings announcement as a public company. 

The stage of the Signal conference for Twilio developers.

Image source: Twilio.   

Getting in ahead of the crowd

We know what Wall Street is expecting. Analysts see $74.2 million in revenue, at the top of Twilio's own guidance that is calling for growth of 41% to 45%. Landing ahead of its own forecast would obviously be a good thing, but the market may still be concerned with decelerating top-line growth. Twilio's year-over-year growth clocked in at 70% during the second quarter and 62% for the third quarter. This would be Twilio's sixth consecutive quarter of sequential deceleration in year-over-year revenue growth.

Analysts also see Twilio's deficit growing since the prior year's holiday quarter, but it has managed to post a much smaller quarterly loss than Wall Street was expecting in its first two reports as a public company.

A good sign heading into tomorrow's report is that it got a boost from Wall Street last week. JMP Securities analyst Patrick Walravens upgraded the stock from market perform to outperform last week, after his firm's checks show strong developer demand for Twilio's platform. Twilio provides real-time communications solutions that can be incorporated within existing apps. Twilio's biggest customers include Uber, Airbnb, and WhatsApp. 

It's not all unicorns and dot-com giants relying on Twilio to improve the responsiveness of their platforms. There were 34,457 developers on Twilio by the end of September, a 45% boost over the past year alone. Investors will be checking out the developer count, but they also shouldn't forget to compare how top-line growth is moving relative to its developer tally. Revenue has been growing faster than the number of developers on its platform as the companies leaning on Twilio are spending more, on average. Switching costs are high in terms of potential fumbles during the migration process, so once Twilio lands new customers they tend to stick around. It's been a different story when it comes to shareholders sticking around, but that's why Tuesday is so important in validating an investment in one of last year's hottest IPOs.