Twilio shares fell as much as 4% in premarket trading and were down 6.77% at $279.36 after HSBC analyst Sameer Lam downgraded the stock to Reduce from Hold while keeping his $211 price target. Lam said Twilio’s recent rally, which followed Meta’s September 8, 2026 debut of its Muse AI agent, had made the shares overvalued. Twilio has gained roughly 30% since Muse debuted and nearly tripled over the past year. HSBC agrees that AI agents should increase demand for calls, messages and authentications, but argues Twilio’s role may be narrower than investors expect and that the company is being treated as the core infrastructure behind Muse and other consumer-facing AI agents. Wall Street’s broader view remains more positive, with a Buy consensus and an average price target of $254.59. TD Cowen and Rosenblatt recently raised their targets to $300 and $290, respectively, while Morgan Stanley and Stifel remain positive on Twilio’s AI prospects ahead of its October 29, 2026 quarterly results.