Twilio (TWLO) agreed to buy business text messaging firm Zipwhip for $850 million in cash and stock as its acquisition spree continues. Twilio stock rose on the Zipwhip deal, which is expected to close by year end.
San Francisco-based Twilio announced the deal late Monday. Zipwhip’s software enables companies to generate two-way text messages on existing landline phone numbers. Twilio did not disclose Seattle-based Zipwhip’s revenue but said it has more than 30,000 customers.
Twilio stock rose 2.4% to near 304.40 in midday trading on the stock market today.
The company, in a release, reiterated its June quarter revenue guidance of $591 million to $601 million, which excludes any impact from the Zipwhip deal.
Twilio Stock: Zipwhip Deals Follows Segment, SendGrid Purchases
However, the software stock holds a Relative Strength Rating of only 35 out of a best-possible 99. Twilio stock trades below both its 50-day and 200-day moving averages and needs to form a base to be actionable.
Twilio’s tools enable app developers to embed voice, text messaging and video into their products. In addition, Twilio’s software makes it easier for cloud-based applications to communicate.
Among recent deals, Twilio acquired Segment in November for $3.2 billion in stock. It bought SendGrid in 2018 for $2 billion.
Meanwhile, Twilio stock has retreated 34% from its all-time high of 457.30 set on Feb. 18.
Software growth stocks have been hit by rising interest rates and a market rotation into sectors that will likely benefit from a 2021 economic recovery as the coronavirus emergency eases.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.