Twilio Inc. (NYSE:TWLO) is possibly approaching a major achievement in its business, so we would like to shine some light on the company. Twilio Inc., together with its subsidiaries, provides customer engagement platform solutions in the United States and internationally. With the latest financial year loss of US$1.0b and a trailing-twelve-month loss of US$462m, the US$17b market-cap company alleviated its loss by moving closer towards its target of breakeven. As path to profitability is the topic on Twilio's investors mind, we've decided to gauge market sentiment. In this article, we will touch on the expectations for the company's growth and when analysts expect it to become profitable.

Twilio is bordering on breakeven, according to the 27 American IT analysts. They expect the company to post a final loss in 2025, before turning a profit of US$69m in 2026. So, the company is predicted to breakeven approximately 2 years from today. What rate will the company have to grow year-on-year in order to breakeven on this date? Using a line of best fit, we calculated an average annual growth rate of 87%, which is extremely buoyant. If this rate turns out to be too aggressive, the company may become profitable much later than analysts predict.

Given this is a high-level overview, we won't go into details of Twilio's upcoming projects, however, take into account that generally a high growth rate is not out of the ordinary, particularly when a company is in a period of investment.

One thing we'd like to point out is that 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 important factors you should further research:

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.