I included this general thought at the end of my response in the Twilio earnings results thread, but I felt it was worthy of a thread of its own.
I recall from back in February, that Saul (or was it only Bear?) was clear to point out that Twilio’s non-Uber revenue growth rate was pretty outstanding. The very simplified thesis was that as the non-Uber revenue continued to grow, that the hit from the whole Uber thing would fade away into the past and the non-Uber revenue growth rate would eventually overshadow declines from Uber-related revenue.
Similarly, Nutanix’s recurring software revenue growth rate is considerably higher than the hardware revenue, which was basically just a zero margin pass-through that they’re moving away from. Thus, their revenue growth picture seems to have some parallels to Twilio.
Also, Pivotal’s subscription-based revenue is growing considerably faster than their legacy business’s revenue, which should allow their total revenue growth rate to accelerate as the subscription revenue grows to overwhelm the other revenue. Again, this seems to me to be a decent corollary/parallel to Twilio’s revenue story.
For a quick data point, Twilio’s share price was under $27 in late January 2018 (before the early-February market dip, and is now over $72/share in the after-hours today. I am not suggesting that the market is missing the Pivotal and Nutanix growth rates to the extent that it missed Twilio, but it may be missing things a bit.
Anyone have any further thoughts on my comparison here or able to point out why the parallels I have suggested might not actually exist?
Thanks,
volfan84
no Twilio position; long PVTL; long NTNX
