Photo Credit: Gerd Altmann from Pixabay

According to a recent report, the global Unified Communication as a Service (UCaaS) market is projected to grow at 15% CAGR to reach $85.77 billion by 2030 from $32.01 billion in 2023. Communications PaaS player Twilio (NYSE: TWLO) recently announced its second quarter results that surpassed market expectations. The company is leveraging AI capabilities into its tools to continue to drive its growth rate.

Twilio’s Financials

Twilio’s second quarter revenues grew 10% to $1.04 billion, surging ahead of the market’s forecast of $984.5 million. Earnings of $0.54 per share was also significantly better than the earnings of $0.29 per share forecast by the market.

Among key metrics, Twilio said it had over 304,000 active customer accounts at the end of the quarter, compared with 275,000 a quarter ago. Dollar-Based Net Expansion Rate was 103% for the second quarter, compared to 123% for the second quarter of 2022.

Twilio expects to end the current quarter with revenues of $980-$990 million with earnings of $0.33-$0.37 per share. The market forecast revenues of $1.01 billion with earnings of $0.30 per share.

Twilio’s AI Focus

Recently, Twilio announced the expansion of its partnership with Google Cloud, which consists of an integration between Google Cloud Contact Center AI and Twilio Flex. The integration facilitates the deployment of AI-powered virtual agents offering conversational self-service interactions.

The partnership will also allow the two companies to leverage the powers of generative AI into Flex. Users will be able to access personalized services with recommendations provided to contact center agents with the “best next action” that should be taken based on relevant historical context and data sourced from the customer profile. The technology will make the process more efficient by utilizing generative AI to complete time-consuming tasks like after call summaries, providing agents to serve customers more effectively, and increasing operation efficiency. Twilio also entered into a similar agreement with Amazon for the implementation of predictive AI technology.

The introduction of generative AI to Flex will allow for the recording of critical first-party data and traits from customer calls, building rounded customer profiles that can be later used to assist and delight end users. The integration with AI will enable Twilio’s community of more than 10 million developers to continue to expand their products. For instance, developers will be able to build a ChatGPT plugin for Twilio Flex that will give users the ability to access Flex directly from ChatGPT’s interface, thus opening a new channel for brands to serve their customers. Some of the other potential use cases include the ability for developers to create voice-activated chatbots using Twilio’s native speech recognition and Amazon Polly Neural text-to-speech capabilities with ChatGPT and pairing ChatGPT with Twilio Programmable Messaging to build a serverless SMS chatbot.

Twilio’s stock is trading at $61.22 with a market cap of $10.92 billion. The stock had climbed to a 52-week high of $81.56 in August of last year and reported a 52-week low of $41.00 in October of last year.

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