Amplitude, Inc. annual report, FY2022

Amplitude, Inc. — FY 2022 Form 10-K Summary

Reporting period: Fiscal year ended December 31, 2022, compared primarily with FY 2021. This annual filing does not provide standalone Q4 results. Amplitude sells a cloud-based digital analytics platform, primarily through subscriptions.

Financial and operating performance

MetricFY 2022FY 2021
Revenue$238.1 million$167.3 million
Gross profit / margin$167.6 million / 70%$115.5 million / 69%
Operating loss / margin$96.6 million / (41%)$74.1 million / (44%)
Net loss$93.4 million$75.0 million
Net cash used in operating activities$5.4 million$31.7 million
Free cash flow (non-GAAP)$(11.2) million$(34.9) million
  • Subscription revenue was 97% of total revenue. Revenue increased 42%, driven by 25% growth in paying customers and expansion within existing accounts.
  • GAAP operating expenses were $264.2 million, up 39%. Research and development rose 67% to $80.6 million; sales and marketing rose 51% to $130.0 million. General and administrative expenses fell 3% to $53.6 million, partly because $18.2 million of 2021 direct-listing costs did not recur.
  • Stock-based compensation was $67.2 million, up from $34.4 million. Non-GAAP operating loss was $26.2 million (11% margin), versus $14.6 million (9% margin) in 2021.
  • At year-end, cash and cash equivalents were $218.5 million and marketable securities were $83.2 million; restricted cash was $0.9 million. Cash and cash equivalents alone were $307.4 million a year earlier. Current assets were $284.4 million and current liabilities $109.2 million.
  • The balance sheet lists no borrowings or debt. Deferred revenue was $90.0 million. Remaining performance obligations were $248.2 million, up 46%, including $190.6 million expected within 12 months.

Material changes versus FY 2021

  • Paying customers increased to 1,994 from 1,597; customers above $100,000 ARR rose to 480 from 385. Customers above $1 million ARR increased to 30 from 29.
  • Dollar-based net retention declined to 119% from 123%, indicating continued existing-customer expansion but at a slower rate.
  • Revenue and gross margin improved, but the absolute GAAP net loss widened to $93.4 million from $75.0 million. Operating cash use improved substantially; free cash flow remained negative.
  • Investing cash outflow was $89.4 million, principally reflecting $83.2 million of marketable-security purchases. Financing cash inflow was $5.8 million, compared with $222.6 million in 2021, which included preferred-stock proceeds.

Outlook, risks, contingencies, and unusual items

  • Management gave no specific numerical revenue, earnings, or cash-flow guidance. It expects near-term spending on product development and sales growth, with research and development and sales and marketing expenses potentially increasing as a percentage of revenue in the short term. Management believes current cash and cash equivalents will cover working capital and capital expenditures for at least 12 months.
  • Key risks include continued losses, retention and expansion trends, longer and less predictable enterprise sales cycles, competition, macroeconomic pressure on software spending, privacy and data-protection regulation, cybersecurity, and reliance on third-party cloud infrastructure. AWS hosting arrangements include a five-year minimum spend of $267 million; $227 million remained at year-end 2022.
  • Total contractual obligations were $240.2 million, including $228.5 million of purchase commitments, primarily hosting, and $11.7 million of lease and real-estate commitments. The filing’s commitment table reports $64.6 million due in 2023 and $126.7 million in 2024–2025.
  • The company reported no legal proceeding expected to have a material adverse effect and no material indemnification claims known. The filing identifies revenue arrangements with non-standard terms as a critical audit matter; the auditor issued an unqualified opinion and concluded internal control over financial reporting was effective.

Important facts for investors to verify

  • Whether customer retention and expansion stabilize or continue to weaken, particularly given the decline in net retention to 119%.
  • How quickly revenue growth can translate into lower GAAP losses and positive free cash flow, considering operating expense growth and substantial stock-based compensation.
  • The economics and flexibility of the AWS commitment, including remaining minimum spend of $227 million.
  • The quality and timing of contracted revenue conversion: $248.2 million of remaining performance obligations, with $190.6 million expected within 12 months.
  • Potential dilution from equity compensation: 16.8 million options and 9.9 million RSUs were outstanding at year-end, alongside the company’s dual-class voting structure.