Twilio stock forecast
Twilio’s weighted value is $153.85 in October 2029, a −40% return, based on 30% bear, 50% base and 20% bull probabilities. It hinges on whether cash after stock pay grows enough to offset valuation compression.
Where could Twilio’s shares be by 2029?
The forecast points to substantial downside over all three dates. The probability-weighted price is $108.01 in October 2027, $135.92 in October 2028 and $153.85 in October 2029, equal to returns of negative 58%, negative 47% and negative 40% with dividends included, from today’s $258.29.
| Case | Probability | October 2027 | October 2028 | October 2029 |
|---|---|---|---|---|
| Bear | 30 % | 107.62 (-58 %) | 114.86 (-56 %) | 154.80 (-40 %) |
| Base | 50 % | 107.94 (-58 %) | 148.03 (-43 %) | 152.99 (-41 %) |
| Bull | 20 % | 108.76 (-58 %) | 137.23 (-47 %) | 154.58 (-40 %) |
| Weighted | 100 % | 108.01 (-58 %) | 135.92 (-47 %) | 153.85 (-40 %) |
What this means. The weighted row is the probability-based average of the bear, base, and bull values, so it is not a separate forecast.
What could go right or wrong for Twilio?
Cash after stock pay is the central operating assumption. The base case rises from $320 million in October 2027 to $570 million in October 2028 and $750 million in October 2029. The latest complete annual figure was $345.020 million, while the latest quarter produced $210.733 million after stock pay, versus $352.645 million before stock pay. Twilio also raised its 2026 reported free-cash-flow guidance to $1.135–$1.155 billion, although that figure precedes stock pay. The forecast therefore assumes continued operating leverage, but not a large AI windfall.
The bear case falls to $150 million, then $100 million, before recovering to $230 million. That reflects the negative after-compensation results recorded from 2021 through 2023 and pressure from carrier costs. The bull case reaches $500 million, $950 million and $1.300 billion because software add-ons grew above 25% in Q2 2026 and management targets stock pay at 10% of revenue in 2027.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Free cash flow after stock pay | 320 (150 / 500) | 570 (100 / 950) | 750 (230 / 1,300) |
| Shares (millions) | 153 (154 / 153) | 153 (154 / 152) | 152 (154 / 150) |
| Enterprise value to free cash flow after stock pay | 44.40 (94.80 / 28.50) | 34.70 (150 / 18.90) | 26.40 (90.00 / 15.20) |
| Net debt | -2,350 (-2,311 / -2,390) | -2,840 (-2,665 / -2,890) | -3,455 (-3,155 / -3,505) |
What this means. The negative net debt means the company has more cash than borrowed money, so it has net cash.
How much cash does Twilio really make?
Stock compensation changes the economic reading. Twilio added back 600,407 of stock pay in operating cash flow because it was not an immediate cash payment. Deducting it analytically leaves “real free cash flow” of 345,020, or 6.8% of revenue. This is not Twilio’s official measure, but it shows what remains after recognizing the cost borne by owners.
| 2025 | 2024 | 2023 | 2022 | 2021 | |
|---|---|---|---|---|---|
| Cash from operations | 1,003,244 | 716,241 | 414,752 | -254,368 | -58,192 |
| − Capital spending | 57,817 | 58,786 | 51,235 | 80,182 | 90,021 |
| = Free cash flow | 945,427 | 657,455 | 363,517 | -334,550 | -148,213 |
| − Stock pay | 600,407 | 616,607 | 675,857 | 798,560 | 632,285 |
| = Real free cash flow | 345,020 | 40,848 | -312,340 | -1,133,110 | -780,498 |
| Real free cash flow, % of revenue | 6.8% | 0.9% | -7.5% | -29.6% | -27.5% |
What this means. Real free cash flow is lower because paying employees with shares uses no cash but gives away part of the company to them.
What does Twilio stock valuation look like today?
A P/E, or price-to-earnings ratio, shows how much investors pay for each dollar of profit. At $258.29 a share, Twilio trades at a high multiple of recent and expected earnings. The trailing P/E is 36.0 times; the forward P/E is 38.1 times. But second-quarter earnings included a $5.91-per-share noncash tax benefit. Twilio had tax losses that it now expects to use against future profits, so accounting rules allowed it to reduce a valuation allowance. No customer paid that amount, which means the reported profit was not all created by selling more services.