Shares of Amplitude (NASDAQ: AMPL) fell 16.3% on Wednesday after the digital-analytics platform provider announced mixed quarterly results and disappointing forward guidance.
Amplitude's "strong" quarter just wasn't enough
Amplitude's fourth-quarter 2023 revenue grew 9% year over year to $71.4 million, translating to adjusted (non-GAAP) net income of $0.04 per share. Analysts, on average, were only expecting earnings of $0.03 per share, but on slightly higher revenue.
The company's number of paying customers soared 37% year over year to 2,723, far outpacing its 10% growth in annual recurring revenue (ARR) to $281 million. Amplitude also swung to positive free cash flow of $1.5 million in Q4, compared to negative free cash flow of $5.9 million in the same year-ago period.
Amplitude co-founder and CEO Spenser Skates called it a "strong" end to the year, noting the company ended the quarter with a record number of new enterprise logo wins. "We see continued validation that our strategic approach -- a Digital Analytics Platform with product analytics at its core -- is the right one to win in the long term," Skates added.
What's next for Amplitude investors?
For the full-year 2024, however, Amplitude issued guidance for revenue to be in the range of $291.5 million to $294.5 million, which should translate to adjusted net income of $0.06 to $0.08 per share. Both ranges were well below Wall Street's consensus estimates, which called for earnings of $0.12 per share on revenue of $297.4 million.
In the end, Amplify's results weren't bad. To the contrary, the company drove decent top-line growth and improvements to both profitability and cash flow. But the market was expecting more, and the stock is responding in kind today.
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