August 11, 2025
5 min read
Jeremy Bowman
This Software-as-a-Service Stock Is Getting Into Agentic AI, and It Could Be a Game-Changer
Amplitude (NASDAQ: AMPL), a digital product analytics specialist, is building momentum with accelerating revenue growth and a strategic push into agentic AI that could transform its business. Amplitude recently reported its third consecutive quarter of accelerating revenue growth. Its platform strategy is evolving with innovative features like session replay, which lets clients observe customer navigation on websites, and interactive guides and surveys that engage users in real time. The company’s annual recurring revenue (ARR) grew 16% year over year to $335 million, with net-new ARR hitting $15 million—the highest in nearly three years. Its dollar-based net retention rate reached 104% in the second quarter, the strongest in at least six quarters, signaling recovery from earlier post-pandemic churn. On a reported basis, revenue rose 14% year over year to $83.3 million, surpassing analyst expectations of $81.3 million. The number of customers with ARR exceeding $100,000 increased 16% to 634. Adjusted profit per share was $0.01, up from breakeven a year earlier, and free cash flow nearly tripled to $18.2 million.Amplitude's AI Playbook
Amplitude has made several acquisitions over the past year to enhance its AI capabilities and platform offerings. Last October, it acquired Command AI, which underpins its guides and surveys product—its fastest-adopted new offering to date. More recently, Amplitude acquired June, known for AI-powered product analytics; Kraftful, which specializes in AI-native Voice of Customer technology; and Inari, a feedback analytics tool. These acquisitions strengthen Amplitude’s talent pool and product suite as it deepens its AI integration. In June, Amplitude launched its AI agents in beta, with plans to commercialize them later this year. Two standout AI agents are:- Experiment: Generates website variants based on existing data to optimize user experience.
- Insight Generation: Analyzes client dashboards to identify trends and recommend solutions, such as diagnosing traffic drops and suggesting remedies. Customer response to these AI agents has been positive, demonstrating Amplitude’s potential to deliver significant value amid widespread AI hype. Additionally, Amplitude received recognition from Forrester in its inaugural digital analytics solutions report, ranking highest in strength of offering and earning the title of customer favorite.
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Is Amplitude a Buy?
Amplitude’s third-quarter guidance projects revenue between $85 million and $87 million, a 17.3% increase, indicating continued acceleration. Despite a modest $2 billion market cap, Amplitude’s growth trajectory is promising even before factoring in its AI agents. As it competes with legacy providers like Google Analytics and Adobe Analytics, its AI-driven innovations could be a key differentiator. With its platform strategy, acquisitions, and AI integration aligning, Amplitude is well-positioned for growth. If its momentum continues and AI agents gain traction, the stock could see significant upside.Originally published at The Motley Fool on August 10, 2025.