Valuation Allowance Release Boosts Net Income
Twilio released a significant portion of its U.S. valuation allowance, resulting in a $944.1 million income tax benefit and a deferred tax asset recognition.
TWILIO INC is expected to release its Q3 2026 10-Q filing on October 28, 2026, after market close. Last quarter: Twilio's Q2 FY2026 results featured a $944.1 million tax benefit that propelled net income to $1.07 billion, while 22% revenue growth and a 116% dollar-based net expansion rate underlined strong operational momentum.
EPS Estimate
$1.42
Revenue Estimate
$1.49B
Analyst consensus from Finnhub and Financial Modeling Prep. Actual results posted within minutes of the SEC filing on the TWLO page.
Drawn from management commentary in the Q2 2026 10-Q:
Twilio released a significant portion of its U.S. valuation allowance, resulting in a $944.1 million income tax benefit and a deferred tax asset recognition.
The company recorded a $32.8 million impairment loss on prepaid network services after two service providers faced operational and financial challenges; this did not affect free cash flow.
Incremental A2P fees from major U.S. carriers increased both revenue and cost of revenue by $71.1 million each, creating a headwind to gross margin but no impact on gross profit.
Revenue
$1.5B
+22.03% YoY
EPS (Diluted)
$6.68
+4671.43% YoY
Gross Margin
48.4%
-0.6 pts YoY
Operating Income
$84.55M
+128.57% YoY
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