With the business potentially at an important milestone, we thought we'd take a closer look at Twilio Inc.'s (NYSE:TWLO) future prospects. Twilio Inc., together with its subsidiaries, provides customer engagement platform solutions in the United States and internationally. The US$23b market-cap company announced a latest loss of US$109m on 31 December 2024 for its most recent financial year result. Many investors are wondering about the rate at which Twilio will turn a profit, with the big question being “when will the company breakeven?” In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

See our latest analysis for Twilio

Twilio is bordering on breakeven, according to the 25 American IT analysts. They expect the company to post a final loss in 2024, before turning a profit of US$95m in 2025. So, the company is predicted to breakeven approximately 12 months from now or less. We calculated the rate at which the company must grow to meet the consensus forecasts predicting breakeven within 12 months. It turns out an average annual growth rate of 49% is expected, which is rather optimistic! Should the business grow at a slower rate, it will become profitable at a later date than expected.

Underlying developments driving Twilio's growth isn’t the focus of this broad overview, however, keep in mind that typically a high forecast growth rate is not unusual for a company that is currently undergoing an investment period.

Before we wrap up, there’s one aspect worth mentioning. The company has managed its capital prudently, with debt making up 12% of equity. This means that it has predominantly funded its operations from equity capital, and its low debt obligation reduces the risk around investing in the loss-making company.

Next Steps:

This article is not intended to be a comprehensive analysis on Twilio, so if you are interested in understanding the company at a deeper level, take a look at Twilio's company page on Simply Wall St. We've also compiled a list of relevant factors you should further examine:

1. Valuation: What is Twilio worth today? Has the future growth potential already been factored into the price? The intrinsic value infographic in our free research report helps visualize whether Twilio is currently mispriced by the market.
2. Management Team: An experienced management team on the helm increases our confidence in the business – take a look at who sits on Twilio’s board and the CEO’s background.
3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.