Amplitude, Inc.

Amplitude, Inc. operates in the AI analytics industry, which is characterized by the increasing importance of data-driven decision-making in product development and a shift towards product-led growth (PLG) strategies. The market is experiencing a convergence of product, web, and marketing, and AI experience analytics into a single "AI analytics" category, which is a pivotal element of modern data platforms as businesses centralize their data stacks. The digital economy's exponential growth is broadening the competitive focus from customer acquisition to retention and engagement, making data-driven insights essential for maintaining relevance and growth. The company believes it is well-positioned to lead this evolving category as a first mover in the space.

The company's core business model revolves around generating revenue primarily through subscription-based pricing for its AI Analytics Platform. This platform is designed to analyze behavioral data and provide real-time, actionable insights to improve engagement, retention, and monetization of digital products and experiences. Amplitude employs a "land-and-expand" strategy, where customers initially adopt the platform for specific use cases and then expand their usage across teams, use cases, and digital properties as they recognize its value. The company serves a diverse customer base, including 4,797 paying customers ⁴ as of December 31, 2025, with 27 of the Fortune 100 ⁵ among them. Subscription revenue constituted 98% ⁶ of total revenue for the year ended December 31, 2025.

Amplitude's platform is a unified AI Analytics Platform that integrates various products to create a powerful feedback loop. The primary offerings include Amplitude Analytics, which provides real-time insights into user behavior; Amplitude Session Replay, offering a qualitative perspective by reconstructing user journeys; Amplitude Feature Experimentation, enabling product, data, and engineering teams to build and test experiments; Amplitude Web Experimentation, facilitating A/B testing and personalization of web experiences; and Amplitude Activation (formerly Customer Data Platform), which unifies data for analytics and personalization. Additionally, the platform includes Amplitude Guides and Surveys, launched in February 2025, to deploy in-product assistance; Amplitude AI Agents, launched in June 2025, to accomplish specific goals like checkout conversion; Amplitude Model Context Protocol (MCP), launched in October 2025, for conversational AI analysis of product data; Amplitude AI Visibility, launched in October 2025, for insights into brand presence in AI search results; Amplitude AI Feedback, launched in November 2025, for processing customer input into actionable insights; and Amplitude Automated Insights, launched in December 2025, to replicate expert analysis.

For the fiscal year ended December 31, 2025, Amplitude reported total revenue of $343.214 million ⁷, an increase of 15% ⁸ from $299.272 million ⁹ in the prior year. Gross profit for the period was $253.928 million ¹⁰, resulting in a gross margin of 74% ¹¹. Operating expenses totaled $349.933 million ¹², leading to a loss from operations of $96.005 million ¹³, or an operating margin of (28)% ¹⁴. The net loss for the year was $88.541 million ¹⁵, with basic and diluted EPS of $(0.67) ¹⁶. Net cash provided by operating activities was $29.824 million ¹⁷, and free cash flow was $23.478 million ¹⁸. As of December 31, 2025, cash and cash equivalents stood at $81.119 million ¹⁹, with marketable securities (current and non-current) totaling $171.425 million ²⁰. The company had no total debt explicitly stated as a single figure, but current liabilities were $164.746 million ²¹ and non-current liabilities were $3.710 million ²², excluding operating lease liabilities.

Comparing fiscal year 2025 to 2024, revenue increased by $43.942 million ²³, or 15% ²⁴. Cost of revenue increased by $12.362 million ²⁵, or 16% ²⁶, primarily due to a $6.0 million ²⁷ increase in third-party hosting costs and a $3.4 million ²⁸ increase in amortization of capitalized internal-use software development costs. Gross margin remained consistent at 74% ²⁹. Research and development expenses saw a minimal increase of $0.1 million ³⁰, or 0% ³¹, while sales and marketing expenses rose by $19.7 million ³², or 12% ³³. General and administrative expenses increased by $0.5 million ³⁴, or 1% ³⁵. The dollar-based net retention rate for paying customers (TTM) improved to 104% ³⁶ as of December 31, 2025, from 97% ³⁷ as of December 31, 2024. The number of paying customers with ARR of $100,000 or greater increased by 18% ³⁸ to 698 ³⁹ in 2025 from 591 ⁴⁰ in 2024, and customers with ARR of $1.0 million or greater increased by 33% ⁴¹ to 56 ⁴² from 42 ⁴³.

During fiscal year 2025, Amplitude launched several new products and capabilities, including Guides and Surveys in February 2025, following the acquisition of Command AI in October 2024. In May 2025, a suite of new marketing capabilities was rolled out. Amplitude AI Agents were introduced in June 2025, and Amplitude MCP server and AI Visibility were launched in October 2025. AI Feedback was launched in November 2025, following the acquisition of Kraftful, Inc. in July 2025. Amplitude's Automated Insights were launched in December 2025. The company also completed an asset acquisition of Inari in June 2025 and a talent acquisition of June.io in July 2025 to accelerate its AI roadmap and enhance AI-driven analytics experiences. In Fall 2024, Amplitude introduced "Amplitude Made Easy" with features like Auto-Capture and a revamped user experience to simplify AI analytics adoption.

The company intends to continue investing significant resources in the development of its AI Analytics Platform, including its research and development team, the development or acquisition of new products, features, and functionality, and improvements to the scalability, availability, and security of its platform. Future investments will also target technology infrastructure, including expansion of activities in third-party data centers, enhancements to network operations, and hiring additional employees. Sales and marketing efforts will be a focus, along with additional international expansion to increase the customer base and sales. General administration, including legal, accounting, and other expenses, will also see continued investment.

A key growth area for Amplitude is the continued development and integration of AI Technologies into its AI Analytics Platform. In fiscal year 2025, the company launched several AI-focused products, including AI Agents in June 2025, Amplitude MCP in October 2025, AI Visibility in October 2025, AI Feedback in November 2025, and Automated Insights in December 2025. These initiatives are designed to help customers accelerate data insights and drive better decision-making through natural language querying, automated trend summaries, and intelligent analysis tools powered by large language models. The company expects to continue investing in and developing AI technologies to enhance platform functionality and deliver greater value to customers.

Another significant growth vector is the expansion of the customer base and deepening relationships with existing customers. The company's "land-and-expand" model is designed to facilitate this growth, with customers typically starting with a specific use case and then expanding to additional functional teams, products, and use cases. This expansion is driven by adding data, users, or new functionality, using the platform for additional digital products, and layering on additional offerings. The company aims to win key reference accounts across industries and emerging use cases to establish itself as the platform of choice for digital innovation.

Operationally, the company expects its cost of revenue to increase in dollar amount as it acquires new customers and existing customers increase their use of the platform. However, in the long term, gross profit is expected to increase in dollar amount, and gross margin is anticipated to improve as system performance is optimized and ingested data is leveraged for new products. Gross margin percentage may fluctuate quarter-to-quarter due to potential reinvestments. Research and development expenses are expected to increase in dollar amount over time but decrease as a percentage of revenue over the longer term, though short-term fluctuations are possible. Sales and marketing expenses are also expected to increase in dollar amount over time but decrease as a percentage of revenue over the longer term, with short-term fluctuations possible depending on marketing initiatives. General and administrative expenses are expected to increase in dollar amount over time but generally decrease as a percentage of revenue over the longer term.

The company's capital allocation plans include continued investment in research and development, with expenses totaling $97.6 million ⁴⁴ for the year ended December 31, 2025. Capital expenditures for purchases of property and equipment were $1.621 million ⁴⁵ and capitalized internal-use software costs were $4.725 million ⁴⁶ for the year ended December 31, 2025. The Board of Directors authorized a share repurchase program on May 7, 2025, for up to $50.0 million ⁴⁷ of Class A common stock, with $26.1 million ⁴⁸ remaining available as of December 31, 2025. On February 18, 2026, the Board approved an increase to this program, authorizing an additional $100.0 million ⁴⁹ for repurchases, bringing the total available for future repurchases to $123.1 million ⁵⁰ as of February 18, 2026. The company does not intend to pay dividends for the foreseeable future.

The company explicitly flagged several structural headwinds and execution risks to its growth plan. These include the difficulty in forecasting future results due to a limited operating history and rapid growth, the challenge of achieving and sustaining profitability given increasing costs, and the dependence on existing customers renewing and purchasing additional subscriptions, as well as attracting new customers. Fluctuations in financial results and key metrics are expected, making future projections difficult. The focus on sales to larger enterprise organizations may increase the variability of sales cycles and results of operations. The company also notes that revenue recognition over contract terms means downturns or upturns in new sales may not be immediately reflected.

Geographically, the company's operations are international in scope, with 39% ⁵¹ of revenue generated outside the United States for the year ended December 31, 2025. Further geographic expansion is planned, which creates operational challenges. Regulatory and macro factors identified as constraints include unfavorable conditions in the industry or global economy, reductions in software spending, and the potential for the market for SaaS applications to develop more slowly or decline. The evolving regulatory framework for AI Technologies, including new laws and regulations in the U.S. and EU (such as the EU Artificial Intelligence Act and the revised EU Product Liability Directive), may limit the company's ability to use AI Technologies or require costly changes to products and operations. Sanctions and export controls targeting Russia and other countries, as well as other responses to Russia's invasion of Ukraine, could also adversely impact the business.

Amplitude faces several material risks, including macroeconomic instability such as inflationary pressures, rising interest rates, debt and equity market fluctuations, bank failures, and diminished liquidity, which could lead to reductions in software spending and limit business growth. The market for SaaS applications may develop slower than expected or decline, impacting the business. Competition in the AI analytics market is highly fragmented and rapidly evolving, with low barriers to entry, and larger competitors possess greater financial and marketing resources. Operational risks include the potential for disruptions, outages, defects, or other performance and quality problems with the platform or its reliance on public cloud and internet infrastructure, which could lead to contractual penalties or customer churn. The company's development and use of AI Technologies may not achieve intended benefits and could expose it to technical, legal, and regulatory risks, including the production of inaccurate or misleading data, or liability for intellectual property infringement from AI-generated output. Regulatory risks are significant, with evolving privacy and data-related laws globally, such as the EU GDPR, UK GDPR, CCPA, and the new U.S. Department of Justice's Data Security Program, potentially imposing expensive compliance requirements, restrictions on data transfers, and significant fines. Geopolitical risks include the ongoing war in Ukraine and conflicts in the Middle East, which could lead to market disruptions, supply chain interruptions, and increased cyberattacks, potentially preventing contract performance or revenue recognition.

Management's message to shareholders emphasizes Amplitude's mission to help companies build better products and digital experiences through its AI Analytics Platform, which is designed to analyze behavioral data and provide real-time, actionable insights. They highlight the company's position as a first mover in the evolving AI analytics category and its "land-and-expand" business model, which has resulted in significant customer growth and strong dollar-based net retention rates. Management is focused on continuing to acquire new customers and expanding relationships with the existing installed base, particularly larger enterprises, to support long-term growth. They also stress the importance of continuous investment in platform innovation and technology development, including the integration of AI Technologies, to maintain market leadership and meet evolving customer needs. The company's strategic priorities include product expansion, strengthening its sales force and partner ecosystem, and expanding its international presence. Management explicitly states that they do not intend to pay any cash dividends in the foreseeable future.