Twilio Inc (TWLO)

Return on equity (ROE)

		Dec 31, 2024	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020
Net income	US$ in thousands	-109,403	-1,015,440	-1,256,140	-949,900	-490,979
Total stockholders’ equity	US$ in thousands	7,952,970	9,732,550	10,559,000	11,031,500	8,452,660
ROE		-1.38%	-10.43%	-11.90%	-8.61%	-5.81%

December 31, 2024 calculation

ROE = Net income ÷ Total stockholders’ equity
= $-109,403K ÷ $7,952,970K
= -1.38%

The analysis of Twilio Inc's return on equity (ROE) over the period from December 31, 2020, to December 31, 2024, reveals a pattern of persistent negative values, indicating ongoing challenges in generating net income relative to shareholders’ equity. Specifically, the ROE for 2020 stood at -5.81%, reflecting a loss layer, and this negative trend deepened in 2021 and 2022, with ROE values of -8.61% and -11.90%, respectively. These figures suggest that the company experienced increasing difficulty in translating equity into positive net income during this period.

However, there is notable improvement beginning in 2023 and continuing into 2024. The ROE in 2023 improved to -10.43%, and further advanced to -1.38% in 2024. This upward trajectory indicates a significant reduction in losses relative to shareholders' equity, pointing towards a potential trend of operating improvements or cost management efforts that are slowly starting to translate into better financial performance.

Despite this positive trend in the most recent year, the overall ROE remains negative, implying that Twilio Inc has yet to achieve consistent profitability from an equity perspective. The substantial narrowing of the negative ROE in 2024 suggests an optimistic outlook if this trajectory continues, but the company remains in a loss-making position relative to equity. Investors and analysts should consider both the recent improvements and the historical context when assessing the company’s financial health and future prospects.