XML 24 R14.htm IDEA: XBRL DOCUMENT v3.23.2
Reorganization and Segment Reporting
 6 Months Ended
Jun. 30, 2023
Restructuring and Related Activities [Abstract]  
Reorganization and Segment Reporting Reorganization and Segment Reporting
In February 2023, the Company announced a reorganization of its business into two business units, Twilio Communications and Twilio Data & Applications (the “Reorganization”). With the Reorganization, the Company changed the organizational structure of its business, including the way management operates the business.
The Company’s Chief Executive Officer is its CODM. In the second quarter of 2023, the Company began regularly providing the CODM with discrete financial information for each business unit, as presented below, which required a reevaluation of the Company’s operating and reportable segments in accordance with ASC 280. The Company concluded that as of June 30, 2023, it had two operating and reportable segments: Twilio Communications and Twilio Data & Applications.
Twilio Communications: The Communications segment consists of a variety of application programming interfaces (“APIs”) and software solutions to optimize communications between Twilio customers and their end users. The key products from which the segment derives its revenue are Messaging, Voice and Email.
Twilio Data & Applications: The Data & Applications segment consists of software products that enable businesses to achieve more effective customer engagement by providing the tools necessary for customers to build direct, personalized relationships with their end users. The key products from which the segment derives its revenue are Segment, Engage, Flex and Marketing Campaigns.
Presented below is the discrete financial information by reportable segment for the three and six months ended June 30, 2023 and 2022, that is regularly reviewed by the CODM for performance assessment and resource allocation decisions. Asset information is not presented below since it is not reviewed by the CODM on a segment by segment basis. Revenue and costs of revenue are generally directly attributable to each segment. Certain costs of revenue are allocated based on methodologies that best reflect the patterns of consumption of these costs. Prior period comparative financial information presented below was restated to conform to the current period presentation.

Three Months Ended
June 30,		Six Months Ended June 30,
2023202220232022
(In thousands)
Revenue:
     Communications$913,135 $832,305 $1,796,365 $1,604,158 
     Data & Applications124,626 111,049 247,960 214,559 
          Total1,037,761 943,354 2,044,325 1,818,717 
Non-GAAP gross profit:
     Communications440,071 387,294 865,211 759,448 
     Data & Applications101,810 93,469 202,806 181,543 
          Total$541,881 $480,763 $1,068,017 $940,991 
Reconciliation of non-GAAP gross profit to gross profit:
Total non-GAAP gross profit$541,881 $480,763 $1,068,017 $940,991 
Stock-based compensation(6,334)(3,996)(11,624)(8,517)
Amortization of acquired intangibles(29,669)(31,236)(59,630)(61,872)
Payroll taxes related to stock-based compensation(123)(242)(318)(242)
Gross profit505,755 445,289 996,445 870,360 
Operating expenses(647,582)(757,225)(1,402,356)(1,400,104)
Other expenses, net(23,616)(8,239)(91,204)(14,916)
Loss before provision for income taxes$(165,443)$(320,175)$(497,115)$(544,660)

Depreciation and amortization expenses included in non-GAAP gross profit for the Communications reportable segment was $13.9 million and $7.0 million in the three months ended June 30, 2023 and 2022, respectively, and $23.1 million and $13.8 million in the six months ended June 30, 2023 and 2022, respectively.

Depreciation and amortization expenses included in non-GAAP gross profit for the Data & Applications reportable segment was $3.5 million and $1.5 million in the three months ended June 30, 2023 and 2022, respectively, and $6.6 million and $2.8 million in the six months ended June 30, 2023 and 2022, respectively.