May 25, 2017

Twilio shares crushed as major customer Uber pulls business



Less than a year after its IPO, Twilio is losing its largest customer Uber was mentioned 57 times on Twilio’s earnings call. If you’re a Twilio investor, that’s not a good thing.

Shares of Twilio TWLO, -26.31% tumbled 25% on Wednesday after Twilio blamed client Uber’s distancing for a weaker-than-expected outlook . That’s prompted analysts to admit they were wrong about the severity of the threat set to weigh heavily on Twilio’s business.

On a call with analysts shortly after the company reported first-quarter earnings late Tuesday, Twilio CEO Jeff Lawson said Uber, which accounted for 12% of the company’s revenue during the quarter, would be moving some of the technology it uses to communicate with customers in-house.

Twilio makes cloud-based software that brands can use to reach out to customers: think in-app messaging services. While it has major brands on its books as clients, including Nordstrom JWN, +2.06% , Airbnb Inc. and Amazon.com Inc. AMZN, -0.11% , Uber and Facebook Inc.’s FB, -1.09% WhatsApp are its two largest clients by far.

A number of other analysts lowered their price target on the stock, pushing the average target among a FactSet survey of nearly 15 analysts down to $32.45. Shares of Twilio traded […]

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