What happened

Shares of Twilio (NYSE:TWLO) climbed 25.6% in November, according to data from S&P Global Market Intelligence, after the cloud-based communications company announced strong third-quarter results and enjoyed subsequent optimism from Wall Street.

More specifically on the former, Twilio shares popped more than 30% on Nov. 7, 2018, alone -- the first trading day after the company revealed that its quarterly revenue skyrocketed 68% year over year, to $101 million, translating to adjusted net income of $0.07 per share. Analysts, on average, were only looking for earnings of $0.05 per share on revenue of $150.4 million. 

Twilio red text logo with a circle and four dots in the center


So what

Twilio saw the size of its client base expand by 31% year over year, to 61,153 active customer accounts. And each of those customers was willing to pay more for Twilio's products, as the company's dollar-based net expansion rate jumped 145%.

If that weren't enough, Twilio also signed an agreement in October to acquire email delivery service leader SendGrid (NYSE:SEND) in an all-stock deal worth roughly $2 billion -- an encouraging strategic move that earned the stock an upgrade from Oppenheimer analyst Ittai Kidron in late November. 

Now what

Looking ahead, Twilio predicted its fourth-quarter revenue would arrive in the range of $183 million to $185 million, good for growth of 60% year over year, which should translate to net income per share of $0.03 to $0.04. Here again, the midpoints of both ranges were comfortably above consensus estimates at the time for earnings of $0.02 per share on revenue of $161.4 million. 

In the end, even with Twilio stock up roughly $180 year to date leading into its report last month, it was hard to blame the market for continuing to bid up shares given the gravity of its latest quarterly beat.