Cloud communications software manufacturer Twilio On Thursday, it released promising profit forecasts for the next few years.

The company is expanding its adjusted operating margin to 21% to 22% in 2027 as part of a three-year guidance framework. This is higher than the visible alpha’s consensus of 19.68%. Twilio’s adjusted work margin most recent quarter It’s 16.1%.

Twilio revealed its new guidance at an investor event Thursday. There, the company’s executives also committed to generating $3 billion in free cash flow over the next three years, and about $692 million in 2022, 2023 and 2024. The visible alpha consensus for 2025-2027 is $2.76 billion in 2027.

The company’s shares rose more than 10% in extended trading after the company released a presentation for the event.

CEO Khozema Shipchandler told CNBC ahead of the company’s investor day that if 2024 was about rebuilding Twilio’s foundation, 2025 is all about execution.

“If we execute well in 2025, I think we start writing our story in 2026,” Shipchandler said. Replaces co-founder Jeff Lawson Serves as CEO in January 2024.

Twilio, which sends text messages and emails to customers, did not target revenue growth through 2027 at Thursday’s event.

Management also provided guidance for 2025 on Thursday. It calls for $825 million to $850 million in free cash flow and the same amount of adjusted operating income, with revenue growing 7% to 8%. Consensus visible alpha is $814 million, with adjusted operating income and free cash flow of about $888 million. Revenue forecasts for 2025 are in line with the LSEG consensus.

More than 9,000 AI companies have been built on Twilio services. These include OpenAI, which in December announced a 1-800-Chatgpt service that leverages Twilio voice tools.

“We’re hoping to attract more businesses,” Shipchandler said. “We’re open season on both fronts.”

Shareholder input influenced the restructuring, including 17% reduction in workforce In early 2023, activist investors Anson Capital and Legion Partners Asset Management fretted about selling Twilio or one of its business units, CNBC reports.

Since activist investor Sachem Head Management won a seat on Twilio’s board of directors last April, Twilio’s stock has jumped about 81% as revenue growth accelerated and losses narrowed.

Twilio has the opportunity to show double-digit growth in 2025 and beyond, it said in a report earlier this month. Analysts equal a buy rating on the stock.

Twilio says that by expanding into new areas, such as artificial intelligence, it can sell to a total addressable market of $158 million by 2028, compared with $158 billion when focusing solely on the communications and customer data platform categories. .

A spokesman said the company does not believe the acquisition is necessary to reach its new total addressable market.

Twilio’s preliminary fourth-quarter results show 11% revenue growth, with adjusted operating income beating the company’s high of $185 million to $195 million release October. Analysts polled by LSEG expected revenue to rise 7.9%, with the adjusted operating income consensus of about $190 million based on visible alpha.

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