Amplitude Announces Second Quarter 2021 Financial Results

  • Revenue of $39.3M, up 66% year over year
  • Current Remaining Performance Obligations of $116.9M, up 76% year over year

SAN FRANCISCO–(BUSINESS WIRE)–Amplitude, Inc., a pioneer in digital optimization, today announced financial results for its second quarter ended June 30, 2021.

“The acceleration of the digital world has put digital products at the center of business. Digital products are driving how businesses operate, go to market and generate revenue,” said Spenser Skates, CEO and co-founder of Amplitude. “As organizations make the shift to product-led growth, they are turning to Amplitude to help drive business outcomes. Great execution combined with strong demand for the Amplitude Digital Optimization System has led to our exceptional second quarter results, highlighted by revenue growth of 66% year-over-year, and a strong outlook for the year. We believe we are in the very early stages of a large opportunity and that we can help companies of various sizes and digital maturities build great products through data.”

Second Quarter 2021 Financial Highlights:

(in millions, except per share data)

 

Q2 2021

Q2 2020

Y/Y Change

Revenue

$39.3

$23.7

66%

Current Remaining Performance Obligations

$116.9

$66.5

76%

GAAP Loss from Operations

$(9.7)

$(11.5)

$1.8

Non-GAAP Loss from Operations

$(4.1)

$(1.9)

$(2.2)

GAAP Net Loss Per Share

$(0.34)

$(0.47)

$0.13

Non-GAAP Net Loss Per Share

$(0.15)

$(0.08)

$(0.07)

Net Cash used in Operating Activities

$(5.1)

$(7.2)

$2.1

Free Cash Flow

$(5.8)

$(7.7)

$1.9

Non-GAAP loss from operations and non-GAAP net loss per share exclude expenses related to stock-based compensation expense and related employer payroll taxes, amortization of acquired intangible assets, and non-recurring costs, such as direct listing costs. Direct listing costs were $2.1 million in Q2’21 and there were no direct listing costs in Q2’20. The section titled “Non-GAAP Financial Measures” below contains a description of the non-GAAP financial measures and reconciliations between historical GAAP and non-GAAP information are contained in the tables below.

Second Quarter and Recent Business Highlights

  • Number of paying customers grew 51% year-over-year to 1,280.
  • Dollar-based net retention rate (NRR) at the end of June 30, 2021, was 119% and relatively consistent with the prior year’s rate.
  • Introduced Amplitude Experiment, the industry’s first full stack experimentation solution powered by customer behavior and product analytics to provide organizations with end-to-end experimentation and delivery workflow that integrates customer data into every step from generating a hypothesis to targeting users to measuring results.
  • Introduced Amplitude Recommend, the industry’s first personalization solution powered by customer behavior, machine learning, and product analytics to enable organizations to determine the right experience for each user and instantly measure impact on key outcomes like purchase conversion, average order size, or video completion. The system then adapts each individual experience based on these insights to optimize the desired outcome.
  • Hosted inaugural Digital Disruptors Summit, a premier event for innovators and transformers who are shaping the world through disruptive digital products.
  • Hosted its Virtual Investor Day on September 14, 2021, which was held in connection with Amplitude’s registration statement on Form S-1 filed with the U.S. Securities and Exchange Commission relating to the proposed direct listing of its Class A common stock. A replay of the event is available at investors.amplitude.com.

Financial Outlook:

For the third quarter and full year 2021, the Company expects:

 

Q3 2021

FY 2021

Revenue

$43.0 – $44.0 million

$160.0 – $162.0 million

Non-GAAP Loss from Operations

$(5.0) – $(4.0) million

$(25.0) – $(23.0) million

Non-GAAP Net Loss Per Share

$(0.15) – $(0.12)

$(0.50) – $(0.46)

Weighted Average Shares Outstanding

34.2 million

49.6 million

Additionally, the Company expects that its full year 2022 total revenue growth will be in excess of 40%.

Fully Diluted Share Count: Approximately 129.6 million shares as of September 30, 2021. Excluding shares that are issuable with respect to outstanding options and restricted stock units (“RSUs”) that have been granted but have not yet vested or satisfied the service-based vesting condition per their terms, the fully diluted share count is 114.0 million. Both measures are calculated on a treasury stock method basis with respect to all common and preferred shares assuming a hypothetical per-share price of $32.02, the price of our series F preferred stock offering.

These statements are forward-looking and actual results may differ materially. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

Non-GAAP loss from operations and non-GAAP net loss per share expectations exclude expenses related to stock-based compensation expense and related employer payroll taxes (inclusive of stock-based compensation expense associated with the satisfaction of the performance-based vesting condition upon the Company’s listing on the Nasdaq Capital Market related to RSUs, for which the service-based vesting condition has already been met), amortization of acquired intangible assets, and non-recurring costs, such as direct listing costs. Direct listing costs are expected to be between $15.2 million and $15.5 million in Q3 2021 and $17.3 million and $17.7 million for the full year 2021. A reconciliation to GAAP loss from operations and GAAP net loss per share has not been provided as the quantification of certain items included in the calculation of GAAP loss from operations and GAAP net loss per share cannot be reasonably calculated or predicted at this time without unreasonable efforts. For example, the non-GAAP adjustment for stock-based compensation expense requires additional inputs such as the number and value of awards granted that are not currently ascertainable, and the non-GAAP adjustment for amortization of acquired intangible assets depends on the timing and value of intangible assets acquired that cannot be accurately forecasted.

Conference Call Information:

Amplitude will host a live video webcast to discuss the company’s financial results for the second quarter ended June 30, 2021 as well as the financial outlook for its third quarter and fiscal year 2021 today at 2:00 PM Pacific Time / 5:00 PM Eastern Time. A replay of this will be available a few hours after the conclusion of the live webcast. Interested parties can access these on the events section of Amplitude’s investor relations page at investors.amplitude.com.

Forward-Looking Statements:

This press release contains express and implied “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding the Company’s financial outlook for the third quarter of 2021 and full year 2021, expected 2022 revenue growth, the Company’s growth strategy and business aspirations and its market position. These statements are often, but not always, made through the use of words or phrases such as “may,” “should,” “could,” “predict,” “potential,” “believe,” “expect,” “continue,” “will,” “anticipate,” “seek,” “estimate,” “intend,” “plan,” “projection,” “would,” and “outlook,” or the negative version of those words or phrases or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not statements of historical fact, and are based on current expectations, estimates, and projections about the Company’s industry as well as certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond the Company’s control. These statements are subject to numerous uncertainties and risks that could cause actual results, performance, or achievement to differ materially and adversely from those anticipated or implied in the statements, including risks related to: the Company’s limited operating history and rapid growth over the last several years, which makes it difficult to forecast the Company’s future results of operations; the Company’s history of losses; any decline in the Company’s customer retention or expansion of its commercial relationships with existing customers or an inability to attract new customers; expected fluctuations in the Company’s financial results, making it difficult to project future results; the Company’s focus on sales to larger organizations and potentially increased dependency on those relationships, which may increase the variability of the Company’s sales cycles and results of operations; downturns or upturns in new sales, which may not be immediately reflected in the Company’s results of operations and may be difficult to discern; unfavorable conditions in the Company’s industry or the global economy, or reductions in information technology spending, which could limit the Company’s ability to grow its business; the market for SaaS applications, which may develop more slowly than the Company expects or decline; the Company’s intellectual property rights, which may not protect its business or provide the Company with a competitive advantage; and evolving privacy and other data-related laws. Additional risks and uncertainties that could cause actual outcomes and results to differ materially from those contemplated by the forward-looking statements are or will be included under the caption “Risk Factors” and elsewhere in the reports and other documents that the Company files with the Securities and Exchange Commission from time to time. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. The Company undertakes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law.


Non-GAAP Financial Measures:

This press release includes financial information that has not been prepared in accordance with GAAP. The Company uses non-GAAP financial measures internally in analyzing its financial results and believes they are useful to investors, as a supplement to GAAP measures, in evaluating the Company’s ongoing operational performance. The Company believes that the use of these non-GAAP financial measures provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing the Company’s financial results with other companies in the industry, many of which present similar non-GAAP financial measures to investors. There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under U.S. GAAP. For example, other companies in the Company’s industry may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance. In addition, free cash flow does not reflect the Company’s future contractual commitments and the total increase or decrease of its cash balance for a given period.

Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to their most directly comparable GAAP financial measures below. A reconciliation of the Company’s non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the financial statement tables included below in this press release.


Non-GAAP Gross Profit, Non-GAAP Gross Margin, Non-GAAP Loss from Operations, Non-GAAP Operating Margin, Non-GAAP Net Loss, and Non-GAAP Loss per Share.

The Company defines these non-GAAP financial measures as their respective GAAP measures, excluding expenses related to stock-based compensation expense and related employer payroll taxes, amortization of acquired intangible assets, and non-recurring costs, such as direct listing costs. The Company excludes stock-based compensation expense and related employer payroll taxes, which is a non-cash expense, from certain of its non-GAAP financial measures because it believes that excluding this item provides meaningful supplemental information regarding operational performance. The Company excludes amortization of intangible assets, which is a non-cash expense, related to business combinations from certain of its non-GAAP financial measures because such expenses are related to business combinations and have no direct correlation to the operation of the Company’s business. Although the Company excludes these expenses from certain non-GAAP financial measures, the revenue from acquired companies subsequent to the date of acquisition is reflected in these measures and the acquired intangible assets contribute to the Company’s revenue generation. The Company excludes non-recurring costs from certain of its non-GAAP financial measures because such expenses do not repeat period over period and are not reflective of the ongoing operation of the Company’s business.

The Company uses non-GAAP gross profit, non-GAAP gross margin, non-GAAP loss from operations, non-GAAP operating margin, non-GAAP net loss and non-GAAP loss per share in conjunction with its traditional U.S. GAAP measures to evaluate the Company’s financial performance. The Company believes that these measures provide its management and investors consistency and comparability with its past financial performance and facilitates period-to-period comparisons of operations.

Free Cash Flow and Margin. The Company defines free cash flow as net cash used in operating activities, less cash used for purchases of property and equipment and capitalized internal-use software costs. The Company believes that free cash flow is a useful indicator of liquidity that provides its management, board of directors, and investors with information about its future ability to generate or use cash to enhance the strength of its balance sheet and further invest in its business and pursue potential strategic initiatives. Free cash flow margin is calculated as free cash flow divided by total revenue.


Definitions of Business Metrics

Dollar-based net retention rate

The Company calculates dollar-based net retention rate as of a period end by starting with the Annual Recurring Revenue (“ARR”) from the cohort of all customers as of 12 months prior to such period-end (the “Prior Period ARR”). The Company then calculates the ARR from these same customers as of the current period-end (the “Current Period ARR”). Current Period ARR includes any expansion and is net of contraction or attrition over the last 12 months, but excludes ARR from new customers as well as any overage charges in the current period. The Company then divides the total Current Period ARR by the total Prior Period ARR to arrive at the point-in-time dollar-based net retention rate. The Company then calculates the weighted-average of the trailing 12-month point-in-time dollar-based net retention rates, to arrive at the dollar-based net retention rate.

The Company defines ARR as the annual recurring revenue of subscription agreements at a point in time based on the terms of customers’ contracts. ARR should be viewed independently of revenue, and does not represent the Company’s U.S. GAAP revenue on an annualized basis, as it is an operating metric that can be impacted by contract start and end dates and renewal rates.

About Amplitude

Amplitude is a pioneer in digital optimization software. It has more than 1,200 paying customers, including 26 of the Fortune 100.

AMPLITUDE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(unaudited)
June 30, 2021 December 31, 2020
Assets
Current assets:
Cash and cash equivalents

$

291,062

 

$

117,783

 

Restricted cash, current

 

1,080

 

 

1,080

 

Accounts receivable, net

 

25,242

 

 

17,396

 

Prepaid expenses and other current assets

 

11,981

 

 

6,857

 

Deferred commissions, current

 

7,016

 

 

5,563

 

Total current assets

 

336,381

 

 

148,679

 

Property and equipment, net

 

3,523

 

 

2,673

 

Intangible assets, net

 

4,554

 

 

1,955

 

Goodwill

 

3,694

 

 

1,000

 

Restricted cash, net

 

850

 

 

 

Deferred commissions, noncurrent

 

17,941

 

 

13,877

 

Other noncurrent assets

 

9,589

 

 

6,898

 

Total assets

$

376,532

 

$

175,082

 

Liabilities, Redeemable Convertible Preferred Stock, and Stockholders’ Deficit
Current liabilities:
Accounts payable

$

3,751

 

$

4,417

 

Accrued expenses

 

14,803

 

 

8,110

 

Deferred revenue

 

61,050

 

 

40,797

 

Total current liabilities

 

79,604

 

 

53,324

 

Noncurrent liabilities

 

1,504

 

 

1,067

 

Total liabilities

 

81,108

 

 

54,391

 

Commitments and contingencies
Redeemable convertible preferred stock:

 

361,113

 

 

187,811

 

Stockholders’ deficit:
Additional paid-in capital

 

55,657

 

 

37,704

 

Accumulated deficit

 

(121,346

)

 

(104,824

)

Total stockholders’ deficit

 

(65,689

)

 

(67,120

)

Total liabilities, redeemable convertible preferred stock, and stockholders’ deficit

$

376,532

 

$

175,082

 

AMPLITUDE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(unaudited)
Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

 
Revenue

$

39,254

 

$

23,692

 

$

72,364

 

$

46,022

 

Cost of revenue (1)

 

12,135

 

 

7,206

 

 

22,390

 

 

13,516

 

Gross profit

 

27,119

 

 

16,486

 

 

49,974

 

 

32,506

 

Operating expenses:
Research and development (1)

 

8,544

 

 

8,486

 

 

15,529

 

 

14,141

 

Sales and marketing (1)

 

20,040

 

 

14,193

 

 

36,810

 

 

25,369

 

General and administrative (1)

 

8,282

 

 

5,354

 

 

13,531

 

 

9,498

 

Total operating expenses

 

36,866

 

 

28,033

 

 

65,870

 

 

49,008

 

Operating loss

 

(9,747

)

 

(11,547

)

 

(15,896

)

 

(16,502

)

Other income (expense), net

 

32

 

 

51

 

 

20

 

 

227

 

Loss before provision for income tax

 

(9,715

)

 

(11,496

)

 

(15,876

)

 

(16,275

)

Provision for income taxes

 

368

 

 

219

 

 

646

 

 

348

 

Net loss

$

(10,083

)

$

(11,715

)

$

(16,522

)

$

(16,623

)

Net loss per share
Basic and diluted

$

(0.34

)

$

(0.47

)

$

(0.57

)

$

(0.68

)

Weighted-average shares used in calculating net loss per share:
Basic and diluted

 

29,681

 

 

24,684

 

 

28,808

 

 

24,550

 

 
(1) Amounts include stock-based compensation expense as follows:
Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

 
Cost of revenues

$

247

 

$

114

 

$

483

 

$

243

 

Research and development

 

1,154

 

 

3,675

 

 

2,063

 

 

3,986

 

Sales and marketing

 

866

 

 

3,316

 

 

1,689

 

 

3,705

 

General and administrative

 

752

 

 

2,290

 

 

1,361

 

 

2,552

 

Total stock-based compensation expense

$

3,019

 

$

9,395

 

$

5,596

 

$

10,486

 

AMPLITUDE, INC.
SUMMARY OF CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(unaudited)
Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

Cash flows from operating activities:
Net loss

$

(10,083

)

$

(11,715

)

$

(16,522

)

$

(16,623

)

Adjustments to reconcile net loss to net cash used in operating
Depreciation and amortization

 

796

 

 

427

 

 

1,337

 

 

689

 

Stock-based compensation expense

 

3,019

 

 

9,395

 

 

5,596

 

 

10,486

 

Allowance for doubtful accounts

 

13

 

 

44

 

 

(25

)

 

114

 

Changes in operating assets and liabilities:
Accounts receivable

 

(9,931

)

 

(452

)

 

(7,805

)

 

(375

)

Prepaid expenses and other current assets

 

(2,837

)

 

203

 

 

(5,088

)

 

1,031

 

Deferred commissions

 

(4,248

)

 

(1,345

)

 

(5,517

)

 

(1,886

)

Other noncurrent assets

 

(1,375

)

 

(1,249

)

 

(2,691

)

 

(1,863

)

Accounts payable

 

856

 

 

(212

)

 

(699

)

 

(3

)

Accrued expenses

 

5,964

 

 

864

 

 

5,227

 

 

(1,219

)

Deferred revenue

 

12,596

 

 

(3,193

)

 

20,226

 

 

(326

)

Noncurrent liabilities

 

169

 

 

45

 

 

438

 

 

33

 

Net cash used in operating activities

 

(5,061

)

 

(7,188

)

 

(5,523

)

 

(9,942

)

Cash flows from investing activity:
Purchase of property and equipment

 

(405

)

 

(79

)

 

(655

)

 

(262

)

Cash paid for acquisitions, net of cash acquired

 

1,725

 

 

 

 

1,725

 

 

(3,700

)

Capitalization of internal-use software costs

 

(350

)

 

(409

)

 

(731

)

 

(467

)

Net cash provided by (used in) investing activities

 

970

 

 

(488

)

 

339

 

 

(4,429

)

Cash flows from financing activity:
Proceeds from issuance of redeemable convertible preferred stock, net

 

173,302

 

 

49,621

 

 

173,302

 

 

49,821

 

Proceeds from the exercise of stock options

 

3,993

 

 

1,020

 

 

6,011

 

 

1,066

 

Repurchase of unvested stock options

 

 

 

 

 

 

 

(2

)

Net cash provided by financing activities

 

177,295

 

 

50,641

 

 

179,313

 

 

50,885

 

Net increase (decrease) in cash, cash equivalents, and restricted cash

 

173,204

 

 

42,965

 

 

174,129

 

 

36,514

 

Cash, cash equivalents, and restricted cash at beginning of period

 

119,788

 

 

74,467

 

 

118,863

 

 

80,918

 

Cash, cash equivalents, and restricted cash at end of period

$

292,992

 

$

117,432

 

$

292,992

 

$

117,432

 

AMPLITUDE, INC.
Reconciliation of GAAP to Non-GAAP Data
(In thousands, except percentages)
Three Months Ended June 30, Six Months Ended June 30,

2021

2020

2021

2020

Reconciliation of gross profit and gross margin
GAAP gross profit

$

27,119

 

$

16,486

 

$

49,974

 

$

32,506

 

Plus: stock-based compensation expense and employer taxes on NSOs

 

247

 

 

114

 

 

483

 

 

243

 

Plus: amortization of acquired intangible assets

 

429

 

 

 

 

651

 

 

 

Non-GAAP gross profit

$

27,795

 

$

16,600

 

$

51,108

 

$

32,749

 

GAAP gross margin

 

69.1%

 

69.6%

 

69.1%

 

70.6%

Non-GAAP adjustments

 

1.7%

 

0.5%

 

1.6%

 

0.5%

Non-GAAP gross margin

 

70.8%

 

70.1%

 

70.6%

 

71.2%

Reconciliation of operating expenses
GAAP research and development

$

8,544

 

$

8,486

 

$

15,529

 

$

14,141

 

Less: stock-based compensation expense and employer taxes on NSOs

 

(1,196

)

 

(3,675

)

 

(2,129

)

 

(3,987

)

Less: amortization of acquired intangible assets

 

 

 

(224

)

 

 

 

(291

)

Non-GAAP research and development

$

7,348

 

$

4,587

 

$

13,400

 

$

9,863

 

GAAP research and development as percentage of revenue

 

21.8%

 

35.8%

 

21.5%

 

30.7%

Non-GAAP research and development as percentage of revenue

 

18.7%

 

19.4%

 

18.5%

 

21.4%

GAAP sales and marketing

$

20,040

 

$

14,193

 

$

36,810

 

$

25,369

 

Less: stock-based compensation expense and employer taxes on NSOs

 

(870

)

 

(3,316

)

 

(1,709

)

 

(3,712

)

Less: direct listing expenses

 

(13

)

 

 

 

(13

)

 

 

Non-GAAP sales and marketing

$

19,157

 

$

10,877

 

$

35,088

 

$

21,657

 

GAAP sales and marketing as percentage of revenue

 

51.1%

 

59.9%

 

50.9%

 

55.1%

Non-GAAP sales and marketing as percentage of revenue

 

48.8%

 

45.9%

 

48.5%

 

47.1%

GAAP general and administrative

$

8,282

 

$

5,354

 

$

13,531

 

$

9,498

 

Less: stock-based compensation expense and employer taxes on NSOs

 

(773

)

 

(2,304

)

 

(1,394

)

 

(2,565

)

Less: direct listing expenses

 

(2,073

)

 

 

 

(2,125

)

 

 

Non-GAAP general and administrative

$

5,436

 

$

3,050

 

$

10,012

 

$

6,933

 

GAAP general and administrative as percentage of revenue

 

21.1%

 

22.6%

 

18.7%

 

20.6%

Non-GAAP general and administrative as percentage of revenue

 

13.8%

 

12.9%

 

13.8%

 

15.1%

Reconciliation of operating loss and operating margin
GAAP loss from operations

$

(9,747

)

$

(11,547

)

$

(15,896

)

$

(16,502

)

Plus: stock-based compensation expense and employer taxes on NSOs

 

3,086

 

 

9,409

 

 

5,714

 

 

10,507

 

Plus: amortization of acquired intangible assets

 

429

 

 

224

 

 

651

 

 

291

 

Plus: direct listing expenses

 

2,086

 

 

 

 

2,139

 

 

 

Non-GAAP loss from operations

$

(4,146

)

$

(1,914

)

$

(7,392

)

$

(5,704

)

GAAP operating margin

 

(24.8%

)

 

(48.7%

)

 

(22.0%

)

 

(35.9%

)

Non-GAAP adjustments

 

14.3%

 

40.7%

 

11.8%

 

23.5%

Non-GAAP operating margin

 

(10.5%

)

 

(8.0%

)

 

(10.2%

)

 

(12.4%

)

Reconciliation of net loss
GAAP net loss

$

(10,083

)

$

(11,715

)

$

(16,522

)

$

(16,623

)

Plus: stock-based compensation expense and employer taxes on NSOs

 

3,086

 

 

9,409

 

 

5,714

 

 

10,508

 

Plus: amortization of acquired intangible assets

 

429

 

 

224

 

 

651

 

 

291

 

Plus: direct listing expenses

 

2,086

 

 

 

 

2,139

 

 

 

Non-GAAP net loss

$

(4,482

)

$

(2,082

)

$

(8,018

)

$

(5,824

)

Reconciliation of net loss per share
GAAP net loss per share, basic

$

(0.34

)

$

(0.47

)

$

(0.57

)

$

(0.68

)

Non-GAAP adjustments to net loss

 

0.19

 

 

0.39

 

 

0.30

 

 

0.44

 

Non-GAAP net loss per share, basic

$

(0.15

)

$

(0.08

)

$

(0.27

)

$

(0.24

)

Weighted-average shares used in GAAP and non-GAAP per share calculation, basic and diluted

 

29,681

 

 

24,684

 

 

28,808

 

 

24,550

 

Contacts

Investor Relations

Jason Starr

ir@amplitude.com

Communications

Darah Easton

press@amplitude.com

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