Amplitude outlines $89M–$91M Q4 revenue target amid strong enterprise momentum and AI product launches

Earnings Call Insights: Amplitude (AMPL) Q3 2025

MANAGEMENT VIEW

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Spenser Skates, CEO & Co-Founder, highlighted, "We delivered another strong quarter, continuing the acceleration we saw in Q2. We exceeded expectations on our core financial metrics and made solid progress against our enterprise strategy. Our third quarter revenue was $88.6 million, up 18% year-over-year and exceeding the high end of our guidance." Skates reported annual recurring revenue (ARR) of $347 million and noted growth in customers with more than $100,000 in ARR.

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Skates emphasized the company's focus on AI, saying, "Over the past year, we've rebuilt the Amplitude team to be AI native. We've reorganized product development twice, and we've acquired 4 AI companies." He detailed the launch of several AI-native products, including MCP server, AI agents, AI Visibility, and upcoming AI Feedback, each designed to expand market reach and drive product adoption among nontechnical users.

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Andrew Casey, CFO, stated, "We've delivered another solid quarter of acceleration in our ARR, improved operational efficiency and created greater durability in our future revenue base." He explained, "Our average contract duration grew to nearly 22 months, up from 19 months just 1 year ago." Casey reported total RPO growth of 37% and improvement in contract duration, attributing this to a more repeatable, scalable go-to-market strategy.

OUTLOOK

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Casey provided, "For the fourth quarter of 2025, we expect revenue to be between $89 million and $91 million, representing an annual growth rate of 15% at the midpoint." Non-GAAP operating income is forecasted between $3.5 million and $5.5 million for Q4. Non-GAAP net income per share is projected to be between $0.04 and $0.05, with approximately 142.6 million diluted shares outstanding.

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For the full year 2025, Amplitude raised its revenue outlook to $340.8 million to $342.8 million, reflecting a 14% annual growth rate at the midpoint. Full year non-GAAP operating income is now expected between $0.5 million and $2.5 million, and non-GAAP net income per share between $0.06 and $0.08, based on about 142 million diluted shares.

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Casey stated, "We will continue to focus on gaining new enterprise customers and driving cross-platform sales with our existing customer base." He pointed to the monetization of data ingested into the platform and new product cross-sell opportunities as key growth drivers.

FINANCIAL RESULTS

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Revenue for Q3 2025 was $88.6 million, an 18% increase year-over-year and a 6% rise sequentially. ARR at quarter-end reached $347 million, up $12 million from Q2. Non-GAAP operating income for the quarter was $0.6 million, and non-GAAP net income per share was $0.02 on 143.2 million diluted shares. Free cash flow was $3.4 million for the quarter.

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Gross margin for the quarter was 76%, improving by 1 point sequentially. Sales and marketing expenses represented 43% of revenue, a 1-point decrease from Q2, while G&A expenses dropped to 13% of revenue. R&D expenses rose to 19% of revenue, reflecting increased investment in AI and new product development.

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The number of customers with over $100,000 in ARR grew to 653, up 19 from the previous quarter. Multi-product adoption now accounts for 71% of ARR, with 39% of customers using multiple products.

Q&A

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Koji Ikeda, BofA Securities, asked about the drivers behind RPO growth. Casey responded, "We made a lot of efforts at resegmenting our customers, refocusing our sales coverage on the enterprise group of clients...that’s led to more strategic conversations and thus the deal constructs, which have more duration to them."

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Patrick Schulz, Robert W. Baird, inquired about growth investment balance. Casey replied, "Our guidance is always based upon the lens of execution for us...we're going to stick with that guidance pattern and stick with what we know we can go execute in the market." Skates added focus on sales productivity and leveraging AI for efficiency.

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Elizabeth Elliott, Morgan Stanley, questioned multi-product adoption acceleration. Skates said the company is "focused on the analytics adoption piece" now, with increased action-oriented agent features planned for the future.

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Willow Miller, William Blair, asked about expanding reach to nontechnical users. Skates explained, "We've set really aggressive internal targets for next year for what we expect the -- how we expect the adoption of Amplitude to grow because of what we're building."

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Questions also addressed sales cycle changes, monetization of new AI features, and pricing strategies, with Skates emphasizing a focus on delivering value and maintaining event-based pricing models.

SENTIMENT ANALYSIS

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Analysts' questions were mostly positive, focusing on growth, product innovation, and market expansion, with some neutral to slightly skeptical tones regarding guidance conservatism and monetization strategy.

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Management maintained a confident tone in both prepared remarks and Q&A, emphasizing repeatable execution, strong enterprise traction, and AI-driven product innovation. Phrases like "We are all in here" and "We're going to go really aggressive after it" signaled high confidence.

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Compared to the previous quarter, both analysts and management demonstrated increased optimism, with less focus on macro headwinds and more on growth opportunities and operational improvements.

QUARTER-OVER-QUARTER COMPARISON

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Revenue grew to $88.6 million in Q3 from $83.3 million in Q2, with ARR rising by $12 million sequentially. Non-GAAP operating income turned positive from a loss in Q2.

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Guidance for Q4 and full-year 2025 was raised, reflecting stronger confidence in execution and enterprise strategy compared to the more cautious approach in Q2.

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Analysts continued to focus on RPO growth, enterprise execution, and the impact of new AI products, but showed more enthusiasm about the company's long-term prospects and product pipeline.

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Management tone remained confident, with even greater emphasis on AI innovation and expanded product offerings. Analysts’ sentiment shifted to slightly more positive, reflecting improved financials and clearer strategic direction.

RISKS AND CONCERNS

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Management acknowledged continued cost consciousness among customers and the need to consistently deliver value at a premium price point.

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Casey noted, "We continue to focus on improving sales efficiencies, driving improvement through our changes in process, coverage and expansion of enterprise customers."

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Skates pointed to the early stage of adoption for some new AI products, emphasizing adoption as a priority before monetization.

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The company is closely monitoring the balance between growth investment and operational efficiency.

FINAL TAKEAWAY

Amplitude management highlighted a quarter of strong revenue and ARR growth, increased enterprise contract duration, and meaningful progress in launching new AI-native products. The company raised its full-year revenue guidance and signaled confidence in its strategy to expand multi-product adoption and capture greater value from enterprise customers, driven by accelerated innovation and a focus on operational efficiency.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/ampl/earnings/transcripts]

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