Shares of Twilio Inc. (NYSE:TWLO) have climbed 159.1% so far in 2018, according to data from S&P Global Market Intelligence, thanks largely to a pair of exceptional quarterly reports from the digital communications specialist.
More specifically, Twilio soared more than 20% the day after its stellar fourth-quarter 2017 report in mid-February, then continued to drift higher over the next few months before enjoying a similar pop following its first-quarter 2018 announcement in May.
Twilio stock has continued to rise on the heels of the latter report, in which the company revealed its quarterly revenue had climbed 48% year over year to $129 million, translating to an adjusted net loss of $0.04 per share. For perspective, most investors were modeling a much wider net loss on sales of $116 million.
But apart from simply outpacing expectations, what is making investors so crazy about this yet-to-be-profitable business? For one, revenue growth is handily outpacing Twilio's actual customer growth -- with the latter most recently increasing 33% year over year to just under 54,000. This indicates that not only are new customers realizing the utility of its core cloud-communications products, but existing customers are also proving a lucrative source of incremental growth as they buy into Twilio's other offerings.
Perhaps most exciting, Twilio stock still trades modestly below its post-IPO highs set in late 2016 -- only now, investors are buying a significantly stronger business with incredible momentum. That's not to say Twilio will continue to skyrocket indefinitely (for better or worse, we'll likely see another big move when it posts second-quarter results next month). But as Twilio works to effectively disrupt the enormous IT communications industry, I think its gains are only the beginning in a much longer story.