Amplitude stock drops on lower-than-expected revenue outlook

Amplitude Inc. fell in after-hours trading today after the behavior-tracking firm said its second-quarter revenue would be lower than what analysts expected.

For its first quarter that ended March 31, Amplitude reported a loss before costs such as stock compensation of four cents per share, down from a loss of seven cents per share in the first quarter of 2022. Revenue rose 25% year-over-year, to $66.5 million. Analysts had expected a loss of six cents per share on revenue of $65.25 million.

Amplitude saw its number of paying customers grow 28% year-over-year, to 2,175, with its annual recurring revenue increasing 25% to $262 million. The company’s dollar-based retention rate as of the end of March was 106%, down from 127% as of March 2022.

Amplitude noted that its stock-based compensation expenses and related employer payroll taxes were $20.9 million in the first quarter, up from $13.8 million a year ago. In a rarity for tech companies in 2023, as most companies are laying off staff, the increase was primarily from Amplitude hiring more people.

“Every business with a digital product needs digital analytics,” Spenser Skates, Amplitude’s co-founder and chief executive officer, said in the company’s earnings release. “Amplitude is just scratching the surface of that opportunity and we’re systematically upleveling every part of our business to set us up for success long term.

For the quarter ahead, Amplitude expects adjusted earnings of one to two cents per share on revenue of $66.5 million. For the full year, the company expects an adjusted profit of two to four cents on revenue of $266 million to $269 million.

For the full year, the earnings outlook was a strong beat, since analysts had expected a loss of nine cents per share, but Amplitude fell short on revenue, as analysts were expecting an outlook of $286 million. The lower-than-expected outlook caused Amplitude shares to drop nearly 7% in late trading.

Photo: Amplitude