Amplitude (AMPL) Stock Forecast & Price Target

Amplitude Inc. demonstrates strong financial growth with deferred revenue reaching $109.7 million, a 7% year-over-year increase, and significant expansion within its large enterprise customer base, highlighted by 42 customers spending over $1 million in annual recurring revenue, representing an 8% increase. The company's emphasis on a platform-led sales strategy is proving effective, as evidenced by net revenue retention stabilizing at 100% and a notable rise in the proportion of customers leveraging multiple products, increasing to 25% from 14% in the previous quarter. Furthermore, a substantial 75% of annual recurring revenue now comes from customers contributing over $100,000, reflecting an upward trend that supports a positive outlook for future growth.

Amplitude Inc. is facing a challenging financial outlook, with projections indicating a significant 30% drop in Net New Annual Recurring Revenue (NNARR) for FY25, primarily driven by the impact of aggressive usage assumptions in post-COVID contracts. The company's customer acquisition cost remains elevated at 5.9x, anticipated to decrease but still reflecting high marketing expenditures amid declining monthly tracked users due to constrained marketing budgets. Additionally, while free cash flow margins are expected to modestly increase over the next few years, overall revenue generation inefficiencies and the reliance on volume-based contracts suggest potential long-term difficulties for Amplitude's business model.