Twilio is staying in the customer data platform business. The company said that it has completed its review of Segment, will improve operations and the combination of Segment benefits its core communications customers.
The company during its most recent earnings report said Segment, which is about 7% of revenue, wasn't meeting potential. As a result, Twilio was reviewing what to do with the business.
In a statement, Twilio said the board concluded that Segment would undergo "tangible near-term operational changes to accelerate Segment’s path to break-even non-GAAP income from operations by Q2 2025 and non-GAAP operating profitability thereafter."
Khozema Shipchandler, CEO of Twilio, said Segment strengthens its communication platforms. Shipchandler also said Twilio has authorized an additional $2 billion in share repurchases.
According to Twilio, about 8,000 customers of its communications platform leverage Segment for insights and to create platforms. Segment is seen as a cog in Twilio's AI roadmap.
What's next? Twilio said Thomas Wyatt will become president of Segment March 11. Segment will also restructure, focus on AI and automation and increase its innovation velocity. These efforts will be led by Wyatt, who was previously led product and strategy at People.ai.
As for the outlook, which was on hold pending the Segment review, Twilio said it is expecting 2024 organic revenue growth of 5% to 10% with non-GAAP income from operations of $550 million to $600 million.
In fiscal 2025, Twilio is projecting GAAP operating profitability by the fourth quarter with Segment at break-even in the second quarter.
