Twilio just reported quarterly results for March 2022. Revenue growth at 48%.
Organic Revenue Growth is at 35%
Full report here.
Takeaways for me:
- This industry has tremendous tailwinds. There is plenty of White Space in this industry.
- Twilio is down 72% from its high.
- 75% P/S derating down to 7 from 28. De-Frothing.
- Route is down 33%.
- 45% P/S derating down to 5.8 from 11.2
- Business momentum remains strong, valuations not so.
- What is needed for Route: Good revenue growth along with reasonable margin expansion (RM has low GM). Execution is key.
- What can help Route
- Organic growth of 25 to 30%
- Send clean momentum, this is a very high margin business
- Mr. Messaging, is slightly margin accretive, will add to revenues
- Masivian, good growth momentum
- Route has so far made good use of the equity capital raised in acquiring companies & tech. Management is walking the talk so far.
- What can go wrong
- Low growth
- Margin contraction
- Poor M&A Integration
Disc: Not an investment advice, RM is a significant part of my portfolio.