August 10, 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 (AMPL) is a digital product analytics company that has been building momentum with accelerating revenue growth and a strategic push into AI-powered solutions. Amplitude recently reported its third consecutive quarter of accelerating revenue growth, with annual recurring revenue (ARR) increasing 16% year over year to $335 million. The company also achieved its highest net-new ARR in nearly three years at $15 million, signaling strong business momentum. Its dollar-based net retention rate reached 104% in the second quarter, the best in at least six quarters, indicating improved customer retention following earlier pandemic-related churn. Revenue for the quarter rose 14% year over year to $83.3 million, surpassing analyst expectations of $81.3 million. The number of customers with ARR of $100,000 or more grew 16% to 634. On profitability, Amplitude reported an adjusted profit of $0.01 per share, matching estimates and improving from breakeven a year ago. Free cash flow nearly tripled to $18.2 million from $6.8 million.Amplitude's AI Strategy
Amplitude has made several acquisitions in the past year to enhance its AI capabilities and platform offerings. Key acquisitions include:- Command AI (October 2024): Laid the foundation for guides and surveys products.
- June (July 2025): An AI-powered product analytics tool.
- Kraftful: Specializes in AI-native Voice of Customer analytics.
- Inari: A feedback analytics platform. These acquisitions bolster Amplitude's talent and product suite as it advances its AI initiatives. The company launched AI agents in beta in June 2025, with plans to begin commercial sales later this year. Two notable AI agents introduced are:
- Experiment: Automatically generates website variants based on Amplitude's data.
- Insight Generation: Analyzes client dashboards to identify issues like traffic drops and suggests remedies. Customer response to these AI agents has been positive, and Amplitude demonstrated their potential to add significant value amid widespread AI enthusiasm.
- How AI is Revolutionizing Cryptocurrency Trading
- The Rise of Agentic AI: What Businesses Need to Know
- Amplitude's Latest Earnings Report
Market Position and Outlook
Amplitude received strong validation from Forrester, which rated it highest in strength of offering and recognized it as a customer favorite in its first digital analytics solutions report. The company’s third-quarter guidance calls for revenue between $85 million and $87 million, representing 17.3% growth and indicating continued acceleration. Despite a relatively small market cap of around $2 billion, Amplitude is well-positioned to challenge legacy players like Google Analytics and Adobe Analytics in the digital product analytics space. The integration of AI agents could be a key catalyst for future growth. If Amplitude maintains its growth trajectory and successfully commercializes its AI offerings, the stock could see significant upside.About the Author
Jeremy Bowman is a contributing Motley Fool Stock Analyst covering consumer discretionary, consumer goods, and tech sectors, as well as macroeconomic trends. He holds a B.A. in English and Creative Writing from Colorado College and an MBA from American University.Originally published at The Motley Fool on August 10, 2025.