Amplitude (NasdaqCM:AMPL) 2025 Conference Summary Company Overview - **Company**: Amplitude - **Industry**: Software as a Service (SaaS), specifically in product analytics and marketing analytics Key Points Current Business Momentum - Amplitude has experienced a reacceleration in growth to **18%** [4][5][7] - The company is focusing on consolidating various analytics products to create a comprehensive platform [5][6] - Transitioning from a transactional sales model to an enterprise sales model has been a significant change [6][7] Financial Performance - The company reported a **Net Revenue Retention (NRR)** rate of **104%** last quarter [9] - Growth is attributed to increased data ingestion and new product offerings, despite challenges from overselling during COVID [12][19] - The company aims for **20%+ revenue growth** and NRR of **110%+** in the future [14][26] Product and Market Strategy - Amplitude's monetization strategy includes charging based on event data ingestion and additional modules [10][11] - The company has seen a **30%** increase in revenue from non-product analytics, which now represents **30%** of total revenue [29] - **71%** of Annual Recurring Revenue (ARR) comes from customers using multiple products, indicating a strong cross-sell opportunity [29] Customer Engagement and Retention - The company is focusing on increasing multi-year contracts to improve revenue visibility and reduce churn [18][19] - Newer customer cohorts show better retention and expansion rates compared to older cohorts [24][26] - The company is targeting traditional industries such as healthcare and financial services for growth [32][33] AI and Innovation - Amplitude is introducing AI capabilities, including agentic features that automate experimentation and data analysis [35][36] - The company is optimistic about the potential of AI to enhance customer engagement and retention [40][41] - New products, such as those from the acquisition of Command AI, aim to disrupt existing market players [41] Future Outlook - The company is preparing for tougher comparisons in net new ARR growth but remains optimistic about market demand [48][49] - Amplitude is focused on balancing growth and profitability, with a path towards achieving the **Rule of 40** metric [51][53] Competitive Landscape - The acquisition of Statsig by OpenAI is seen as validation of the importance of experimentation in digital engagement [44][45] - Amplitude is increasingly being adopted by AI-native companies, indicating a growing market presence [47] Additional Insights - The transition to a more enterprise-focused sales strategy is expected to yield better long-term results [20][21] - The company is methodically redesigning sales territories to optimize performance without causing disruption [20][21] - There is a significant opportunity for upselling within the existing customer base, as only **39%** of customers currently use multiple products [19][29] This summary encapsulates the key insights from the Amplitude conference, highlighting the company's growth strategies, financial performance, product innovations, and market positioning.

Core Insights - The current Q3 earnings season is characterized by uncertainty, with investors focused on positioning for potential market corrections in 2026 [1] Group 1: Market Positioning - Investors are considering strategies to navigate a possible market correction in the near future [1] Group 2: Industry Expertise - Gary Alexander has extensive experience in technology sectors, having worked on Wall Street and in Silicon Valley, which informs his insights into current industry trends [1] - His contributions to Seeking Alpha since 2017 highlight his ongoing engagement with market analysis and investment strategies [1]

Core Insights - Amplitude is experiencing a resurgence in revenue growth, attributed to the launch of its new AI platform, which has led to its fastest revenue growth in over two years [3][4] - The company reported an 18% revenue growth in Q3, reaching $88.6 million, surpassing the consensus estimate of $86.3 million [3] - Remaining performance obligations (RPO) increased by 37% to $391.9 million, indicating a trend towards longer-term contracts from customers [4] AI Platform Development - Amplitude has introduced several AI features, including the Model Context Protocol (MCP), which connects AI assistants to the platform, enhancing data accessibility for customers [5][6] - The company also launched AI Visibility, a tool for optimizing performance in AI searches, and AI Feedback, which aggregates and summarizes customer feedback from various sources [6][7] Market Position and Future Outlook - Amplitude is positioned as a smaller player in the software and analytics market, competing against larger entities like Google Analytics and Adobe Analytics [10] - The company is projected to achieve revenues between $340.8 million and $342.8 million, with a market cap of approximately $1.3 billion, resulting in a price-to-sales ratio of 4 [10] - If the AI platform gains traction, there is potential for significant stock price appreciation [10]

Core Insights - Amplitude, Inc. reported revenue of $88.56 million for the quarter ended September 2025, reflecting a year-over-year increase of 17.7% [1] - The company's EPS was $0.02, down from $0.03 in the same quarter last year, but it exceeded the consensus EPS estimate of $0.01 by 100% [1] - The reported revenue surpassed the Zacks Consensus Estimate of $86.03 million, resulting in a revenue surprise of +2.94% [1] Financial Performance Metrics - Dollar-based Net Retention Rate was 104%, exceeding the estimated 103.4% by analysts [4] - The number of Paying Customers stood at 4,500, slightly below the average estimate of 4,565 [4] - Annual Recurring Revenue (ARR) reached $347 million, slightly above the estimated $345 million [4] - Remaining Performance Obligations (RPO) for less than or equal to 12 months were reported at $257,677, surpassing the average estimate of $243,625.60 [4] Stock Performance - Over the past month, Amplitude's shares have returned -6.4%, contrasting with the Zacks S&P 500 composite's +1.3% change [3] - The stock currently holds a Zacks Rank 4 (Sell), indicating potential underperformance relative to the broader market in the near term [3]

Financial Performance - Revenue for Q3 2025 was $88,564,000, representing a 17.5% increase from $75,217,000 in Q3 2024[24] - Gross profit for Q3 2025 was $65,490,000, up from $56,473,000 in Q3 2024, indicating a growth of 15.0%[24] - Total operating expenses for Q3 2025 were $91,140,000, compared to $76,486,000 in Q3 2024, reflecting an increase of 19.2%[24] - Net loss for Q3 2025 was $23,986,000, compared to a net loss of $16,854,000 in Q3 2024, representing a 42.5% increase in losses[24] - Revenue for the nine months ended September 30, 2025, was $251.8 million, an increase of 13.9% compared to $221.1 million for the same period in 2024[37] - Net loss for the nine months ended September 30, 2025, was $70.9 million, compared to a net loss of $61.7 million for the same period in 2024, reflecting a 14.8% increase in losses[32] - Total revenue for the third quarter ended September 30, 2025, was $88.6 million, compared to $75.2 million for the same quarter in 2024, marking a 17.8% increase[37] - The company reported a consolidated net loss of $24.0 million for the third quarter ended September 30, 2025, compared to a net loss of $16.9 million for the same quarter in 2024[37] Cash and Assets - Cash and cash equivalents decreased to $82,217,000 as of September 30, 2025, down from $171,678,000 as of December 31, 2024[22] - Total current assets decreased to $265,777,000 as of September 30, 2025, from $303,631,000 as of December 31, 2024[22] - Cash, cash equivalents, and restricted cash at the end of the period on September 30, 2025, was $83.1 million, down from $318.3 million at the end of the same period in 2024[32] - As of September 30, 2025, cash and cash equivalents were $82.2 million, with an additional $185.1 million in marketable securities[173] Deferred Revenue and Performance Obligations - Deferred revenue increased to $131,534,000 as of September 30, 2025, compared to $109,671,000 as of December 31, 2024, showing a growth of 19.9%[22] - Remaining performance obligations (RPO) increased by 37% to $391.9 million as of September 30, 2025, compared to $286.6 million in 2024[183] - The total remaining performance obligations expected to be recognized within 12 months amounted to $257.7 million as of September 30, 2025[51] Research and Development - Research and development expenses for Q3 2025 were $26,612,000, up from $19,037,000 in Q3 2024, marking an increase of 39.8%[24] - Research and development expenses for the nine months ended September 30, 2025, were $25.3 million, compared to $24.1 million for the same period in 2024, reflecting a year-over-year increase of 4.9%[84] - Amplitude's investment in research and development is expected to increase over time, with a focus on maintaining market leadership and attracting top engineering talent[118] Stock-Based Compensation - Stock-based compensation expense for the nine months ended September 30, 2025, was $70.2 million, up from $64.9 million in the same period of 2024, indicating an increase of 8.1%[32] - The total fair value of RSUs vested during the nine months ended September 30, 2025, was $76.6 million, up from $52.7 million in 2024[78] - The intrinsic value of options exercised for the nine months ended September 30, 2025, was $9.3 million, compared to $12.6 million for the same period in 2024[74] Customer Metrics - As of September 30, 2025, Amplitude reported Annual Recurring Revenue (ARR) of $347 million, a 16% increase from $298 million in 2024[122] - The number of paying customers with ARR of $100,000 or greater increased by 15% year-over-year, reaching 653 customers in 2025 compared to 567 in 2024[114] - The dollar-based net retention rate for the trailing 12 months (TTM) improved to 102% in 2025, up from 97% in 2024[114] Acquisitions - The Company completed the acquisition of Kraftful, Inc. for a total consideration of $3.8 million, including $2.9 million in cash and $0.9 million in equity[62] - The Company acquired certain assets from Inari for $0.5 million in cash on June 25, 2025, which will be amortized over three years[61] - The fair value of developed technology acquired in the Kraftful acquisition was $3.0 million, contributing to a total purchase price allocation of $3.76 million[63] Operating Expenses - Sales and marketing expenses for the three months ended September 30, 2025, were $10.0 million, up 20.4% from $8.3 million in the same period in 2024[84] - General and administrative expenses increased by $2.1 million, or 4%, for the nine months ended September 30, 2025, compared to the same period in 2024[169] - Total operating expenses for the nine months ended September 30, 2025, were $262.6 million, an increase of $26.7 million, or 11%, compared to the prior year[166] Risks and Challenges - The company faces risks related to competition, market demand, and economic conditions that could adversely affect its business[202] - Legal proceedings and potential liabilities may incur significant costs and impact management resources[209] - The competitive landscape for digital analytics applications is fragmented and rapidly evolving, leading to intensified competition[218] Future Outlook - The company plans to invest significantly in the development of its Digital Analytics Platform, technology infrastructure, sales and marketing, international expansion, and general administration[203] - Customer retention and expansion are critical for maintaining revenue growth, with challenges arising from customer satisfaction, pricing, and competition[206] - The company expects fluctuations in financial results and key metrics, making future projections difficult[208]

Financial Data and Key Metrics Changes - The third quarter revenue was $88.6 million, up 18% year over year, exceeding the high end of guidance [3][22] - Annual recurring revenue (ARR) reached $347 million, up 16% year over year, and increased by $12 million from the previous quarter [3][22] - Non-GAAP operating income was $0.6 million, with a gross margin of 76%, down one percentage point from the third quarter of 2024 but up one percentage point from the previous quarter [23][24] - Free cash flow for the quarter was $3.4 million, or 4% of revenue, compared to $4.5 million, or 6% of revenue during the same period last year [24] Business Line Data and Key Metrics Changes - Customers with more than $100K in ARR grew to 653, an increase of 15% year over year [3][23] - 39% of customers now have multiple products, with 71% of ARR coming from that cohort [22][23] - Net revenue retention (NRR) progressed to 104%, driven by cross-sell expansions [23] Market Data and Key Metrics Changes - The average contract duration grew to nearly 22 months, up from 19 months a year ago [20] - Remaining performance obligations (RPO) growth accelerated to 22% year-over-year, up from 20% in the previous quarter [21] - Long-term RPO growth accelerated to 78% year-over-year, up from 64% last quarter [21] Company Strategy and Development Direction - The company is focusing on expanding its enterprise customer base and driving cross-platform sales with existing customers [25] - The strategy includes leveraging AI capabilities to enhance product offerings and improve customer engagement [25][26] - The company aims to redefine analytics as an AI-native system that learns, reasons, and acts [18] Management's Comments on Operating Environment and Future Outlook - Management believes that the importance of analytics and data usage for enterprises is increasing, especially with the rapid changes in development and deployment processes [19][25] - For Q4 2025, the company expects revenue to be between $89 million and $91 million, representing an annual growth rate of 15% at the midpoint [26] - The full-year revenue expectation has been raised to between $340.8 million and $342.8 million, reflecting a 14% annual growth rate at the midpoint [26] Other Important Information - The company has launched several AI-native products, including the MCP Server and AI agents, which are designed to enhance user experience and accessibility for non-technical users [8][12][14] - The company is seeing strong interest from customers in AI capabilities, which is expected to drive future growth [18][40] Q&A Session Summary Question: Can you break down the RPO growth by enterprise, mid-market, and contract duration? - Management noted that the RPO growth is driven by strategic conversations with enterprise clients, leading to multi-year contracts and increased contract duration [29][30] Question: Where are enterprises investing in the product circle of life? - Management indicated that enterprises are still early in the "use and learn" phase, with significant opportunities for improvement in analytics [32][33] Question: Can you provide insight into the Q4 revenue guidance and the balance between growth and profitability? - Management emphasized that the guidance is based on execution visibility and the strong performance of the sales team, balancing growth investments with operational leverage [35][36] Question: How is the adoption of AI products progressing? - Management reported strong customer interest in AI products, with a focus on delivering value and enhancing user experience [54] Question: What are the expectations for multi-product adoption? - Management anticipates a significant increase in multi-product adoption as more users engage with analytics and AI capabilities [40] Question: How does the company view the selling environment currently? - Management noted that there is continued cost consciousness among customers, but excitement around the effectiveness of AI solutions [49]

Q3 2025 Financial Highlights - Revenue reached $88.6 million, an 18% year-over-year increase[12] - Annual Recurring Revenue (ARR) totaled $347 million, reflecting a 16% year-over-year growth[12] - The dollar-based net retention rate was 104%, compared to 98% in Q3 2024[12] - Non-GAAP operating income was $0.6 million, a decrease from $1.6 million in Q3 2024[12] - Free cash flow amounted to $3.4 million, compared to $4.5 million in Q3 2024[12] - The company's cash and investments stood at $268 million[12] Customer Metrics - The company had 653 customers with ARR equal to or greater than $100,000[13] - Enterprise customers accounted for 66% of the company's ARR[13] - Multi-product customers represent 39% of the customer base[42] Q4 2025 and Full Year 2025 Guidance - The company projects Q4 2025 revenue between $89.0 million and $91.0 million, representing a year-over-year growth of 13.9% to 16.5%[58] - Full year 2025 revenue is expected to be between $340.8 million and $342.8 million, a year-over-year increase of 13.9% to 14.5%[58] - Non-GAAP operating income for Q4 2025 is projected to be $3.5 million to $5.5 million, and for the full year 2025, $0.5 million to $2.5 million[58] - Non-GAAP net income per share is expected to be $0.04 to $0.05 for Q4 2025, and $0.06 to $0.08 for the full year 2025[58]

Financial Performance - Annual Recurring Revenue (ARR) reached $347 million, representing a 16% year-over-year increase[5] - Revenue for the third quarter was $88.6 million, an 18% increase compared to $75.2 million in the same quarter of 2024[3] - Remaining performance obligations totaled $391.9 million, up 37% year-over-year[5] - Revenue for the three months ended September 30, 2025, was $88,564,000, representing a 17.5% increase from $75,217,000 in the same period of 2024[24] - Gross profit for the three months ended September 30, 2025, was $65,490,000, up from $56,473,000 in the prior year, indicating a gross margin improvement[24] - Total operating expenses for the three months ended September 30, 2025, were $91,140,000, compared to $76,486,000 in 2024, reflecting a 19.2% increase[24] - GAAP gross profit for Q3 2025 was $65.49 million, up from $56.47 million in Q3 2024, representing a 15.4% increase[27] - Non-GAAP gross profit for the nine months ended September 30, 2025, reached $190.58 million, compared to $168.94 million in the same period of 2024, reflecting a 12.8% growth[27] Profitability and Loss - GAAP net loss per share was $(0.18), compared to $(0.14) in the third quarter of 2024[10] - Non-GAAP net income per share was $0.02, down from $0.03 in the same quarter of 2024[10] - Net loss for the three months ended September 30, 2025, was $23,986,000, compared to a net loss of $16,854,000 in the same period of 2024[24] - GAAP net loss for Q3 2025 was $23.99 million, compared to a net loss of $16.85 million in Q3 2024, indicating a 42.0% increase in losses year-over-year[27] - Free cash flow for Q3 2025 was $3.35 million, down from $4.50 million in Q3 2024, representing a 25.6% decrease[28] Cash Flow and Assets - Cash flow from operations was $5.0 million, a decrease of $1.2 million year-over-year[10] - Free cash flow was $3.4 million, down $1.1 million compared to the previous year[10] - Cash, cash equivalents, and restricted cash at the end of the period was $83,108,000, down from $318,326,000 at the end of September 30, 2024[25] - Total current assets decreased to $265,777,000 as of September 30, 2025, from $303,631,000 as of December 31, 2024[23] Future Outlook - For Q4 2025, the company expects revenue between $89.0 million and $91.0 million[7] - The full year 2025 revenue outlook is projected to be between $340.8 million and $342.8 million[7] Customer Metrics - The number of customers with $100,000 or greater in ARR increased to 653, reflecting a 15% year-over-year growth[10] - Dollar-based Net Retention Rate (NRR) for Q3 2025 was 104%, consistent with the previous quarter, indicating strong customer retention[30] Expenses and Investments - Research and development expenses for the three months ended September 30, 2025, were $26,612,000, up from $19,037,000 in the same period of 2024, reflecting a focus on innovation[24] - The company reported stock-based compensation expense of $25,116,000 for the three months ended September 30, 2025, compared to $21,112,000 in the prior year[24] - Research and development expenses for Q3 2025 were $26.61 million, up from $19.04 million in Q3 2024, a 39.9% increase, indicating a focus on innovation[27] - Sales and marketing expenses for Q3 2025 were $48.31 million, compared to $40.86 million in Q3 2024, reflecting an 18.5% increase in investment in growth initiatives[27] Operational Efficiency - GAAP operating margin for Q3 2025 was -29.0%, compared to -26.6% in Q3 2024, reflecting a decline in operational efficiency[27] - Non-GAAP operating margin for Q3 2025 improved to 0.6%, up from 2.1% in Q3 2024, showing a positive trend in operational performance[27]

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Core Insights - Amplitude has launched an agent-to-agent integration with GitHub to enhance product development by incorporating real-time business context into engineering workflows [1][2][3] Integration Features - The integration enables AI-powered workflows where Amplitude functions as an agentic product manager, facilitating the connection between product insights and code implementation [2][3] - Amplitude's Feature Experimentation Custom Agent, developed in collaboration with GitHub, allows users to query product insights, manage feature flags, and run experiments on new features [3][5] Benefits for Teams - Teams can leverage Amplitude's analytics to identify effective strategies based on actual user behavior, prioritizing work that drives measurable outcomes [4] - The integration reduces manual tasks by auto-generating data-backed product requirements, allowing teams to focus on strategic work [4] - GitHub Copilot coding agent streamlines the development process by taking over from the Product Requirements Document (PRD) and preparing pull requests for review [4] Data-Driven Decision Making - The integration allows teams to track the impact of every feature post-release, enabling continuous learning and improvement based on real user responses [4] - Amplitude's Model Context Protocol (MCP) facilitates the embedding of product and customer data into GitHub Copilot workflows, enhancing AI agents' ability to make informed decisions [5] Company Background - Amplitude is recognized as a leading digital analytics platform, serving over 4,300 customers, including notable companies like Atlassian and NBCUniversal [7] - The company is positioned as a top analytics solution for product, data, and marketing teams, as evidenced by its ranking in G2's Fall 2025 Report [7]