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What changed in Amplitude, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Amplitude, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+256 added−232 removedSource: 10-K (2025-02-20) vs 10-K (2024-02-20)

Top changes in Amplitude, Inc.'s 2024 10-K

256 paragraphs added · 232 removed · 190 edited across 7 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

101 edited+54 added−20 removed343 unchanged
Biggest changeOur current and future international business and operations involve a variety of risks, including: • slower than anticipated public cloud adoption by international businesses; • changes, which may be unexpected, in a specific country’s or region’s political, economic, or legal and regulatory environment, including Brexit, armed conflicts, pandemics, terrorist activities, tariffs, trade wars, or long-term environmental risks; • the need to adapt and localize our Digital Analytics Platform for specific countries; • longer payment cycles and greater difficulty enforcing contracts, collecting accounts receivable, or satisfying revenue recognition criteria, especially in emerging markets; • new, evolving, and more stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe; • differing and potentially more onerous labor regulations, especially in Europe, where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in these locations; • challenges inherent in efficiently managing, and the increased costs associated with, an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, benefits, and compliance programs that are specific to each jurisdiction; • difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems, and regulatory systems; • increased travel, real estate, infrastructure, and legal compliance costs associated with international operations; • currency exchange rate fluctuations and the resulting effect on our revenue and expenses, and the cost and risk of entering into hedging transactions if we choose to do so in the future; • limitations on our ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries; • laws and business practices favoring local competitors or general market preferences for local vendors; • limited or insufficient intellectual property protection or difficulties obtaining, maintaining, protecting, or enforcing our intellectual property rights, including our trademarks and patents; • health epidemics, or other global political, social or macroeconomic events, including the war in Ukraine and the conflict in the Middle East, that could decrease economic activity in certain markets, decrease use of our products and services, or decrease our ability to import, export, or sell our products and services to existing or new customers in international markets; • exposure to liabilities under export control, economic and trade sanctions, anti-corruption, and anti-money laundering laws, including the Export Administration Regulations, regulations administered by the Office of Foreign Assets Control, the U.S.
Biggest changeTo the extent we are unable to effectively engage with non-U.S. customers due to our limited sales force capacity and limited channel partners, we may be unable to effectively grow in international markets. 27 Our current and future international business and operations involve a variety of risks, including: • slower than anticipated public cloud adoption by international businesses; • changes, which may be unexpected, in a specific country’s or region’s political, economic, or legal and regulatory environment, including Brexit, armed conflicts, pandemics, terrorist activities, tariffs, trade wars, or long-term environmental risks; • the need to adapt and localize our Digital Analytics Platform for specific countries; • longer payment cycles and greater difficulty enforcing contracts, collecting accounts receivable, or satisfying revenue recognition criteria, especially in emerging markets; • new, evolving, and more stringent regulations relating to privacy and data security and the unauthorized use of, or access to, commercial and personal information, particularly in Europe; • differing and potentially more onerous labor regulations, especially in Europe, where labor laws are generally more advantageous to employees as compared to the United States, including deemed hourly wage and overtime regulations in these locations; • challenges inherent in efficiently managing, and the increased costs associated with, an increased number of employees over large geographic distances, including the need to implement appropriate systems, policies, benefits, and compliance programs that are specific to each jurisdiction; • difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems, and regulatory systems; • increased travel, real estate, infrastructure, and legal compliance costs associated with international operations; • currency exchange rate fluctuations and the resulting effect on our revenue and expenses, and the cost and risk of entering into hedging transactions if we choose to do so in the future; • limitations on our ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries; • laws and business practices favoring local competitors or general market preferences for local vendors; • limited or insufficient intellectual property protection or difficulties obtaining, maintaining, protecting, or enforcing our intellectual property rights, including our trademarks and patents; • global political, social or macroeconomic events, including the war in Ukraine, the conflicts in the Middle East, and potential public health epidemics or pandemics, that could decrease economic activity in certain markets, decrease use of our products and services, or decrease our ability to import, export, or sell our products and services to existing or new customers in international markets; • exposure to liabilities under export control, economic and trade sanctions, anti-corruption, and anti-money laundering laws, including the Export Administration Regulations, regulations administered by the Office of Foreign Assets Control, the U.S.
If we or our implementation partners fail to train customers on how to efficiently and effectively use our Digital Analytics Platform or we fail to provide adequate product support to our customers, we may lose opportunities for additional subscriptions, customers may choose not to renew or expand the use of our Digital Analytics Platform, we may experience negative publicity or legal claims against us, and our reputation and brand may suffer.
If we or our implementation partners fail to train customers on how to efficiently and effectively use our Digital Analytics Platform or if we fail to provide adequate product support to our customers, we may lose opportunities for additional subscriptions, customers may choose not to renew or expand the use of our Digital Analytics Platform, we may experience negative publicity or legal claims against us, and our reputation and brand may suffer.
Any of these circumstances could materially adversely affect our business, financial condition, and results of operations.
Any of these circumstances could materially adversely affect our business, financial condition, and results of operations.
If we are unable to close one or more expected significant transactions with these customers in a particular period, or if an expected transaction is delayed until a subsequent period, our results of operations for that period, and for any future periods in which revenue from such transaction would otherwise have been recognized, may be adversely affected.
If we are unable to close one or more expected significant transactions with these customers in a particular period, or if an expected transaction is delayed until a subsequent period, our results of operations for that period, and for any future periods in which revenue from such transaction would otherwise have been recognized, may be adversely affected.
Our restated certificate of incorporation and amended and restated bylaws include provisions that: • authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our Class A common stock; • require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent; • specify that special meetings of our stockholders can be called only by our board of directors; 41 • establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors; • establish that our board of directors is divided into three classes, with each class serving three-year staggered terms; • prohibit cumulative voting in the election of directors; • provide that our directors may only be removed for cause; • provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum; and • require the approval of our board of directors or the holders of at least 66 2/3% of our outstanding shares of voting stock to amend our bylaws and certain provisions of our certificate of incorporation.
Our restated certificate of incorporation and amended and restated bylaws include provisions that: • authorize our board of directors to issue, without further action by the stockholders, shares of undesignated preferred stock with terms, rights, and preferences determined by our board of directors that may be senior to our Class A common stock; • require that any action to be taken by our stockholders be effected at a duly called annual or special meeting and not by written consent; • specify that special meetings of our stockholders can be called only by our board of directors; • establish an advance notice procedure for stockholder proposals to be brought before an annual meeting, including proposed nominations of persons for election to our board of directors; • establish that our board of directors is divided into three classes, with each class serving three-year staggered terms; • prohibit cumulative voting in the election of directors; • provide that our directors may only be removed for cause; • provide that vacancies on our board of directors may be filled only by a majority of directors then in office, even though less than a quorum; and 41 • require the approval of our board of directors or the holders of at least 66 2/3% of our outstanding shares of voting stock to amend our bylaws and certain provisions of our certificate of incorporation.
Our restated certificate of incorporation and our amended and restated bylaws provide that: (i) unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if such court does not have subject matter 42 jurisdiction thereof, the federal district court of the State of Delaware) will, to the fullest extent permitted by law, be the sole and exclusive forum for: (A) any derivative action or proceeding brought on our behalf, (B) any action asserting a claim for or based on a breach of a fiduciary duty owed by any of our current or former directors, officers, other employees, agents, or stockholders to us or our stockholders, including, without limitation, a claim alleging the aiding and abetting of such a breach of fiduciary duty, (C) any action asserting a claim against us or any of our current or former directors, officers, other employees, agents, or stockholders arising pursuant to any provision of the Delaware General Corporation Law or our restated certificate of incorporation or amended and restated bylaws or as to which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware, or (D) any action asserting a claim related to or involving us that is governed by the internal affairs doctrine; (ii) unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America will, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act and the rules and regulations promulgated thereunder; (iii) the exclusive forum provisions are intended to benefit and may be enforced by us, our officers and directors, the financial advisors to any offering giving rise to such complaint, and any other professional or entity whose profession gives authority to a statement made by that person or entity and who has prepared or certified any part of the documents underlying the offering; and (iv) any person or entity purchasing or otherwise acquiring or holding any interest in our shares of capital stock will be deemed to have notice of and consented to these provisions.
Our restated certificate of incorporation and our amended and restated bylaws provide that: (i) unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware) will, to the fullest extent permitted by law, be the sole and exclusive forum for: (A) any derivative action or proceeding brought on our behalf, (B) any action asserting a claim for or based on a breach of a fiduciary duty owed by any of our current or former directors, officers, other employees, agents, or stockholders to us or our stockholders, including, without limitation, a claim alleging the aiding and abetting of such a breach of fiduciary duty, (C) any action asserting a claim against us or any of our current or former directors, officers, other employees, agents, or stockholders arising pursuant to any provision of the Delaware General Corporation Law or our restated certificate of incorporation or amended and restated bylaws or as to which the Delaware General Corporation Law confers jurisdiction on the Court of Chancery of the State of Delaware, or (D) any action asserting a claim related to or involving us that is governed by the internal affairs doctrine; (ii) unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States of America will, to the fullest extent permitted by law, be the sole and exclusive forum for the resolution of any complaint asserting a cause of action arising under 42 the Securities Act and the rules and regulations promulgated thereunder; (iii) the exclusive forum provisions are intended to benefit and may be enforced by us, our officers and directors, the financial advisors to any offering giving rise to such complaint, and any other professional or entity whose profession gives authority to a statement made by that person or entity and who has prepared or certified any part of the documents underlying the offering; and (iv) any person or entity purchasing or otherwise acquiring or holding any interest in our shares of capital stock will be deemed to have notice of and consented to these provisions.
As a result of Russia’s invasion of Ukraine, governmental authorities in the United States, the European Union, and the United Kingdom, among others, launched an expansion of coordinated sanctions and export control measures, including, for example: • blocking sanctions on some of the largest state-owned and private Russian financial institutions (and their subsequent removal from the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”) payment system); • blocking sanctions against Russian and Belarusian individuals, including the Russian President, other politicians, and those with government connections or involvement in Russian military activities; • blocking sanctions against certain Russian businessmen and their businesses, some of which have significant financial and trade ties to the European Union; 33 • blocking of Russia’s foreign currency reserves and prohibition on secondary trading in Russian sovereign debt and certain transactions with the Russian Central Bank, National Wealth Fund, and the Ministry of Finance of the Russian Federation; • expansion of sectoral sanctions in various sectors of the Russian and Belarusian economies and the defense sector; • United Kingdom sanctions introducing restrictions on providing loans to, and dealing in securities issued by, persons connected with Russia; • restrictions on access to the financial and capital markets in the European Union, as well as prohibitions on aircraft leasing operations; • sanctions prohibiting most commercial activities of U.S., U.K., and E.U. persons in the so-called People’s Republic of Donetsk and the so-called People’s Republic of Luhansk (and, with respect to the European Union, the areas of Kherson and Zaporizhzhia not controlled by the Ukrainian government), with all of these new restrictions largely tracking prior prohibitions relating to Crimea and Sevastopol; • enhanced import and export controls and trade sanctions targeting Russia’s imports of technological goods, including E.U. and U.K. prohibitions on exporting a wide range of “industrial” goods to Russia (and on importing a large number of “revenue-generating” goods from Russia).
As a result of Russia’s invasion of Ukraine, governmental authorities in the United States, the European Union, and the United Kingdom, among others, launched an expansion of coordinated sanctions and export control measures, including, for example: • blocking sanctions on some of the largest state-owned and private Russian financial institutions (and their subsequent removal from the Society for Worldwide Interbank Financial Telecommunication payment system); • blocking sanctions against Russian and Belarusian individuals, including the Russian President, other politicians, and those with government connections or involvement in Russian military activities; • blocking sanctions against certain Russian businessmen and their businesses, some of which have significant financial and trade ties to the European Union; • blocking of Russia’s foreign currency reserves and prohibition on secondary trading in Russian sovereign debt and certain transactions with the Russian Central Bank, National Wealth Fund, and the Ministry of Finance of the Russian Federation; • expansion of sectoral sanctions in various sectors of the Russian and Belarusian economies and the defense sector; • U.K. sanctions introducing restrictions on providing loans to, and dealing in securities issued by, persons connected with Russia; • restrictions on access to the financial and capital markets in the European Union, as well as prohibitions on aircraft leasing operations; • sanctions prohibiting most commercial activities of U.S., U.K., and E.U. persons in the so-called People’s Republic of Donetsk and the so-called People’s Republic of Luhansk (and, with respect to the European Union, the areas of Kherson 33 and Zaporizhzhia not controlled by the Ukrainian government), with all of these new restrictions largely tracking prior prohibitions relating to Crimea and Sevastopol; • enhanced import and export controls and trade sanctions targeting Russia’s imports of technological goods, including E.U. and U.K. prohibitions on exporting a wide range of “industrial” goods to Russia (and on importing a large number of “revenue-generating” goods from Russia).
Such an event could also expose us to risks, including an inability to provide our services and fulfill contractual demands, and could cause management distraction and the obligation to devote significant financial and other resources to mitigate such problems, which would increase our future information security costs, including through organizational changes, deploying additional personnel, reinforcing administrative, physical, and technical safeguards, further training of employees, changing third-party vendor 24 control practices, and engaging third-party subject matter experts and consultants and reduce the demand for our technology and services.
Such an event could also expose us to risks, including an inability to provide our services and fulfill contractual demands, and could cause management distraction and the obligation to devote significant financial and other resources to mitigate such problems, which would increase our future information security costs, including through organizational changes, deploying additional personnel, reinforcing administrative, physical, and technical safeguards, further training of employees, changing third-party vendor control practices, and engaging third-party subject matter experts and consultants and reduce the demand for our technology and services.
If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, the trading price of our Class A common stock could decline, and we could be subject to sanctions or investigations by the SEC or 45 other regulatory authorities.
If we are unable to conclude that our internal control over financial reporting is effective, or if our independent registered public accounting firm determines we have a material weakness or significant deficiency in our internal control over financial reporting, we could lose investor confidence in the accuracy and completeness of our financial reports, the trading price of our Class A common stock could decline, and we could be subject to sanctions or investigations by the SEC or other regulatory authorities.
Moreover, assuming the availability of certain public information about us, (i) non-affiliates who have beneficially owned our common stock for at least six months may rely on Rule 144 to sell their shares of common stock, and (ii) our directors, executive officers, and other affiliates who have beneficially owned our common stock for at least six months will be entitled to sell their shares of our Class A common stock subject to volume and other limitations under Rule 144 and various vesting agreements.
Moreover, assuming the availability of certain public information about us, (i) non-affiliates who have beneficially owned our common stock for at least six months may rely on Rule 144 to sell their shares of common stock, and (ii) our directors, executive 40 officers, and other affiliates who have beneficially owned our common stock for at least six months will be entitled to sell their shares of our Class A common stock subject to volume and other limitations under Rule 144 and various vesting agreements.
Foreign Corrupt Practices Act (“FCPA”), U.S. bribery laws, the UK Bribery Act, and similar laws and regulations in other jurisdictions; • increased financial accounting and reporting burdens and complexities; • requirements or preferences for domestic products; 29 • differing technical standards, existing or future regulatory and certification requirements, and required features and functionality; • burdens of complying with laws and regulations related to privacy and data security, including the E.U.
Foreign Corrupt Practices Act (“FCPA”), U.S. bribery laws, the UK Bribery Act, and similar laws and regulations in other jurisdictions; • increased financial accounting and reporting burdens and complexities; • requirements or preferences for domestic products; • differing technical standards, existing or future regulatory and certification requirements, and required features and functionality; • burdens of complying with laws and regulations related to privacy and data security, including the E.U.
In addition, high levels of customer satisfaction and market adoption are central to our marketing model. Any decrease in our customers’ satisfaction with our products, including as a result of actions outside of our control, could harm word-of-mouth referrals and our brand. Additionally, many customers never convert from our free-tier, self-service option to a paid subscription contract.
In addition, high levels of customer satisfaction and market adoption are central to our marketing model. Any decrease in our customers’ satisfaction with our products, including as a result of actions outside of our control, could harm word-of-mouth referrals and our brand. 26 Additionally, many customers never convert from our free-tier, self-service option to a paid subscription contract.
For all of these reasons, we may not be 22 able to compete successfully against our current and future competitors, which would harm our business. For more information about the competitive landscape in which we operate, see “Part I, Item 1. Business—Competition” in this Annual Report on Form 10-K.
For all of these reasons, we may not be able to compete successfully against our current and future competitors, which would harm our business. For more information about the competitive landscape in which we operate, see “Part I, Item 1. Business—Competition” in this Annual Report on Form 10-K.
Efforts to comply with such reporting requirements could divert management’s attention from our incident response and could potentially reveal system vulnerabilities to threat actors. Failure to timely report incidents under these rules could also result in monetary fines, sanctions, or subject us to other forms of liability.
Efforts to comply with such reporting requirements could divert management’s attention from our incident response 23 and could potentially reveal system vulnerabilities to threat actors. Failure to timely report incidents under these rules could also result in monetary fines, sanctions, or subject us to other forms of liability.
Risks Related to Regulatory Compliance and Legal Matters We are subject to government regulation, including import, export control, economic, and trade sanctions, and anti-corruption laws and regulations, which may expose us to liability and increase our costs. Our activities must be conducted in compliance with U.S. export controls, including the U.S.
Risks Related to Regulatory Compliance and Legal Matters We are subject to government regulation, including import, export control, economic sanctions, and trade sanctions, and anti-corruption laws and regulations, which may expose us to liability and increase our costs. 31 Our activities must be conducted in compliance with U.S. export controls, including the U.S.
Further, these agreements may not prevent our competitors from independently developing technologies that are substantially equivalent or superior to our platform and offerings. 31 Further, litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others.
Further, these agreements may not prevent our competitors from independently developing technologies that are substantially equivalent or superior to our platform and offerings. Further, litigation may be necessary to enforce our intellectual property or proprietary rights, protect our trade secrets, or determine the validity and scope of proprietary rights claimed by others.
If we fail to offer a variety of integrations or the integrations that our customers and prospective customers expect 26 and demand, then our Digital Analytics Platform may become less marketable, less competitive, or obsolete, and our business, financial condition, results of operations, and growth prospects could be materially adversely affected.
If we fail to offer a variety of integrations or the integrations that our customers and prospective customers expect and demand, then our Digital Analytics Platform may become less marketable, less competitive, or obsolete, and our business, financial condition, results of operations, and growth prospects could be materially adversely affected.
To the extent that fluctuations in currency exchange rates cause our results of operations to differ from our expectations or the expectations of our investors, the trading price of our Class A common stock could be adversely affected. We do not currently maintain a program to hedge transactional exposures in foreign 36 currencies.
To the extent that fluctuations in currency exchange rates cause our results of operations to differ from our expectations or the expectations of our investors, the trading price of our Class A common stock could be adversely affected. We do not currently maintain a program to hedge transactional exposures in foreign currencies.
If we do not successfully maintain and enhance our brand, our business may not grow, we may have reduced pricing power relative to 28 competitors, and we could lose customers or fail to attract potential customers, all of which would materially adversely affect our business, financial condition, and results of operations.
If we do not successfully maintain and enhance our brand, our business may not grow, we may have reduced pricing power relative to competitors, and we could lose customers or fail to attract potential customers, all of which would materially adversely affect our business, financial condition, and results of operations.
Significant estimates and judgments involve those related to revenue 38 recognition, deferred commissions, valuation of our stock-based compensation awards, including the determination of the fair value of our common stock, valuation of goodwill and intangible assets, accounting for income taxes, and useful lives of long-lived assets, among others.
Significant estimates and judgments involve those related to revenue recognition, deferred commissions, valuation of our stock-based compensation awards, including the determination of the fair value of our common stock, valuation of goodwill and intangible assets, accounting for income taxes, and useful lives of long-lived assets, among others.
We are continuing to monitor the situation in Ukraine and assessing its impact on our business, including our business partners and customers. Such circumstances, combined with sanctions have resulted in disruptions to our customers' businesses in the impacted regions, including, at times, their ability to pay for our services.
We are continuing to monitor the situation in Ukraine and assessing its impact on our business, including our business partners and customers. Such circumstances, combined with sanctions have resulted in disruptions to our customers businesses in the impacted regions, including, at times, their ability to pay for our services.
Unauthorized disclosure of, access to, or security breaches of our platform and information technology systems could result in the loss of data, loss of business, severe reputational damage adversely affecting customer or investor confidence, damage to our brand, diversion of management’s attention, regulatory investigations, and orders, litigation, indemnity obligations, damages for contract breach, penalties for violation of applicable laws or regulations, significant costs for remediation that may include liability for stolen assets or information and repair of system damage that may have been caused, incentives offered to customers or other business partners in an effort to maintain business relationships after a breach, and other liabilities.
Unauthorized disclosure of, access to, or security breaches of our platform or our information technology systems could result in the loss of Confidential Information, loss of business, severe reputational damage adversely affecting customer or investor confidence, damage to our brand, diversion of management’s attention, regulatory investigations, and orders, litigation, indemnity obligations, damages for contract breach, penalties for violation of applicable laws or regulations, significant costs for remediation that may include liability for stolen assets or information and repair of system damage that may have been caused, incentives offered to customers or other business partners in an effort to maintain business relationships after a breach, and other liabilities.
If we invest substantial time and resources to further expand our international operations and are unable to do so successfully and in a timely manner, our business, financial condition, and results of operations could be materially adversely affected. The war in Ukraine could materially adversely affect our business, results of operations, and financial condition.
If we invest substantial time and resources to further expand our international operations and are unable to do so successfully and in a timely manner, our business, financial condition, and results of operations could be materially adversely affected. 28 The war in Ukraine could materially adversely affect our business, results of operations, and financial condition.
We depend and rely on third-party hosted cloud services and internet infrastructure in order to operate critical functions of our business. For example, our 25 platform and internal tools use computing, storage capabilities, bandwidth, and other services provided by AWS.
We depend and rely on third-party hosted cloud services and internet infrastructure in order to operate critical functions of our business. For example, our platform and internal tools use computing, storage capabilities, bandwidth, and other services provided by AWS.
If we are unable to develop adequate plans to ensure that our business functions continue to operate during and after a disaster, and successfully execute on those plans in the event of a disaster or emergency, our business and reputation would be harmed.
If we are unable to develop adequate plans to ensure that our business functions continue to operate during and 44 after a disaster, and successfully execute on those plans in the event of a disaster or emergency, our business and reputation would be harmed.
In February 2024, a purported securities class action complaint was filed against us 39 and certain of our current and former officers in U.S. federal court, and we may be the target of this type of litigation in the future.
In February 2024, a purported securities class action complaint was filed against us and certain of our current and former officers in U.S. federal court, and we may be the target of this type of litigation in the future.
In the 44 event of a major earthquake, fire, power loss, telecommunications failure, cyberattack, war or armed conflict (including the war in Ukraine and conflict in the Middle East), terrorist attack, sabotage, other intentional acts of vandalism or misconduct, geopolitical event, disease, or other catastrophic occurrence, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in our application development, lengthy interruptions in our products, breaches of data security, and loss of critical data, all of which could materially adversely affect our business, financial condition, and results of operations.
In the event of a major earthquake, fire, power loss, telecommunications failure, cyberattack, war or armed conflict (including the war in Ukraine and conflicts in the Middle East), terrorist attack, sabotage, other intentional acts of vandalism or misconduct, geopolitical event, disease, or other catastrophic occurrence, we may be unable to continue our operations and may endure system interruptions, reputational harm, delays in our application development, lengthy interruptions in our products, breaches of data security, and loss of critical data, all of which could materially adversely affect our business, financial condition, and results of operations.
We do not have employment agreements with our executive officers 43 or other key personnel that require them to continue to work for us for any specified period; therefore, they could terminate their employment with us at any time.
We do not have employment agreements with our executive officers or other key personnel that require them to continue to work for us for any specified period; therefore, they could terminate their employment with us at any time.
As a result, potential changes in our pricing policies, or our rate of customer expansion or retention, may not be fully reflected in our results of operations until future periods. Moreover, larger organizations may demand price concessions.
As a result, potential changes in our pricing policies, or our rate of customer expansion or retention, may not be fully reflected in our results of operations 25 until future periods. Moreover, larger organizations may demand price concessions.
Although we have implemented policies to regulate the use and incorporation of open-source 32 software into our platform, we cannot be certain that we have not incorporated open-source software in our platform in a manner that is inconsistent with such policies.
Although we have implemented policies to regulate the use and incorporation of open-source software into our platform, we cannot be certain that we have not incorporated open-source software in our platform in a manner that is inconsistent with such policies.
In addition to the other risks described herein, other factors that may cause our results of operations or key metrics to fluctuate include: • fluctuations in demand for, or pricing of, our Digital Analytics Platform, including as a result of our introduction of new products, features, and functionality; • fluctuations in usage of our Digital Analytics Platform; • our ability to attract new customers; • our ability to retain existing customers; • customer expansion rates; • investments in new products, features, and functionality; • the timing of our customers’ purchases; • the speed with which customers are able to migrate data onto our platform after purchasing capacity; • awareness of our brand on a global basis; • fluctuations or delays in purchasing decisions in anticipation of new products, features, or functionality developed or acquired by us or our competitors; • changes in customers’ budgets and in the timing of their budget cycles and purchasing decisions; • our ability to control costs, including our operating expenses; • the amount and timing of costs associated with our cloud computing infrastructure, particularly the cloud services provided by Amazon Web Services (“AWS”); • the amount and timing of payment for operating expenses, particularly research and development and sales and marketing expenses; 19 • the amount and timing of non-cash expenses, including stock-based compensation, goodwill impairments, and other non-cash charges; • the amount and timing of costs associated with recruiting, training, and integrating new employees and retaining and motivating existing employees; • the ability to identify and complete, and the effects of, mergers, acquisitions, or strategic partnerships, and the ensuing integration efforts; • general economic, market, and industry conditions (including the current inflationary economic environment, rising interest rates, and a potential recession), both domestically and internationally, as well as economic conditions specifically affecting industries in which our customers participate, and related difficulties in collections; • the potential adverse impact of climate change, natural disasters, health epidemics (such as the COVID-19 pandemic or similar outbreaks of disease), political and social instability, including acts of war or other armed conflicts (including the war in Ukraine and the conflict in the Middle East), and terrorist activities, on our business, operations, and the markets and communities in which we and our customers and partners operate and the disruption these events may cause to the global economy; • the impact of new accounting pronouncements; • changes in regulatory or legal environments that may cause us to incur, among other things, expenses associated with compliance, particularly with respect to compliance with evolving privacy and data protection laws and regulations, as well as export control, economic and trade sanctions, anti-corruption, and anti-money laundering laws; • the overall tax rate for our business, which may be affected by the mix of income we earn in the United States and in jurisdictions with comparatively lower tax rates, the effects of stock-based compensation, and the effects of changes in our business; • the impact of changes in tax laws or judicial or regulatory interpretations of tax laws, which are recorded in the period such laws are enacted or interpretations are issued and may significantly affect the effective tax rate of that period; • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in the competitive dynamics of our market, including consolidation among competitors or customers; and • significant security breaches of, technical difficulties with, or interruptions to, the delivery and use of our platform.
In addition to the other risks described herein, other factors that may cause our results of operations or key metrics to fluctuate include: • fluctuations in demand for, or pricing of, our Digital Analytics Platform, including as a result of our introduction of new products, features, and functionality; • fluctuations in usage of our Digital Analytics Platform; • our ability to attract new customers; • our ability to retain existing customers; • customer expansion rates; • investments in new products, features, and functionality; • the timing of our customers’ purchases; • the speed with which customers are able to migrate data onto our platform after purchasing capacity; • awareness of our brand on a global basis; • fluctuations or delays in purchasing decisions in anticipation of new products, features, or functionality developed or acquired by us or our competitors; • changes in customers’ budgets and in the timing of their budget cycles and purchasing decisions; • our ability to control costs, including our operating expenses; • the amount and timing of costs associated with our cloud computing infrastructure, particularly the cloud services provided by Amazon Web Services (“AWS”); • the amount and timing of payment for operating expenses, particularly research and development and sales and marketing expenses; 17 • the amount and timing of non-cash expenses, including stock-based compensation, goodwill impairments, and other non-cash charges; • the amount and timing of costs associated with recruiting, training, and integrating new employees and retaining and motivating existing employees; • the ability to identify and complete, and the effects of, mergers, acquisitions, or strategic partnerships, and the ensuing integration efforts; • general economic, market, and industry conditions (including the current inflationary economic environment, rising interest rates, tariffs, and a potential recession), both domestically and internationally, as well as economic conditions specifically affecting industries in which our customers participate, and related difficulties in collections; • the potential adverse impact of climate change, natural disasters, health epidemics (such as the COVID-19 pandemic or similar outbreaks of disease), political and social instability, including acts of war or other armed conflicts (including the war in Ukraine and the conflicts in the Middle East), and terrorist activities, on our business, operations, and the markets and communities in which we and our customers and partners operate and the disruption these events may cause to the global economy; • the impact of new accounting pronouncements; • new and changing laws, regulations, executive orders and enforcement priorities; • changes in regulatory or legal environments that may cause us to incur, among other things, expenses associated with compliance, particularly with respect to compliance with evolving privacy and data protection laws and regulations, as well as export control, economic and trade sanctions, anti-corruption, and anti-money laundering laws; the overall tax rate for our business, which may be affected by the mix of income we earn in the United States and in jurisdictions with comparatively lower tax rates, the effects of stock-based compensation, and the effects of changes in our business; • the impact of changes in tax laws or judicial or regulatory interpretations of tax laws, which are recorded in the period such laws are enacted or interpretations are issued and may significantly affect the effective tax rate of that period; • fluctuations in currency exchange rates and changes in the proportion of our revenue and expenses denominated in foreign currencies; • changes in the competitive dynamics of our market, including consolidation among competitors or customers; and • significant security breaches of, technical difficulties with, or interruptions to, the delivery and use of our platform.
If we are ultimately unable to achieve profitability at the level anticipated by industry or financial analysts and our stockholders, the trading price of our Class A common stock may decline. 18 Our efforts to grow our business may be costlier than we expect, or our revenue growth rate may be slower than we expect, and we may not be able to increase our revenue enough to offset the increase in operating expenses resulting from these investments.
If we are ultimately unable to achieve profitability at the level anticipated by industry or financial analysts and our stockholders, the trading price of our Class A common stock may decline. 16 Our efforts to grow our business may be costlier than we expect, or our revenue growth rate may be slower than we expect, and we may not be able to increase our revenue enough to offset the increase in operating expenses resulting from these investments.
Other limitations, such as those under the Tax Cuts and Jobs Act, as modified by the Coronavirus Aid, Relief, and Economic Security Act, which limit the deductibility of federal NOLs in taxable years beginning after December 31, 2020, to 80% of taxable income, and subsequent changes to the U.S. tax rules in respect of the utilization of NOLs may further affect our ability to use our NOLs in future years.
Other limitations, such as those under the Tax Cuts and Jobs Act, as modified by the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which limit the deductibility of federal NOLs in taxable years beginning after December 31, 2020, to 80% of taxable income, and subsequent changes to the U.S. tax rules in respect of the utilization of NOLs may further affect our ability to use our NOLs in future years.
However, we may have experienced ownership changes after December 31, 2022, and may experience ownership changes as a result of subsequent shifts in our stock ownership, some of which may be outside of our control. Such a change or changes could limit the amount of NOLs that we can utilize annually to offset future taxable income.
However, we may have experienced ownership changes after December 31, 2023, and may experience ownership changes as a result of subsequent shifts in our stock ownership, some of which may be outside of our control. Such a change or changes could limit the amount of NOLs that we can utilize annually to offset future taxable income.
(“Wayfair”) , that online sellers can be required to collect sales and use tax despite not having a physical presence in the buyer’s state. In response to Wayfair , or otherwise, states or local governments may adopt, or begin to enforce, laws requiring us to calculate, collect, and remit taxes on sales in their jurisdictions.
(“ Wayfair ”), that online sellers can be required to collect sales and use tax despite not having a physical presence in the buyer’s state. In response to Wayfair , or otherwise, states or local governments may adopt, or begin to enforce, laws requiring us to calculate, collect, and remit taxes on sales in their jurisdictions.
The techniques used to sabotage, or to obtain unauthorized access to, our platform, information technology systems, networks, or physical facilities in which data is stored or through which data is transmitted change frequently, and we may be unable to implement adequate preventative measures or stop security breaches while they are occurring.
The techniques used to sabotage, or to obtain unauthorized access to, our platform, information technology systems, networks, or physical facilities in which Confidential Information is stored or through which Confidential Information is transmitted change frequently, and we may be unable to implement adequate preventative measures or stop security breaches while they are occurring.
The restrictions also include bans on the export of large numbers of “luxury” items to Russia (and in some cases also to Belarus), tighter controls on exports and reexports of dual-use items, stricter licensing policy with respect to issuing export licenses, and/or increased use of “end-use” controls to block or impose licensing requirements on exports, as well as higher import tariffs; • the closure of airspace to Russian aircraft; • ban on imports of Russian oil, liquefied natural gas, and coal to the United States and on “new investment” in Russia’s energy sector (often with similar bans being enacted in the United Kingdom and the E.U.); • ban on imports of Russian fish, seafood, and preparations thereof, alcoholic beverages, non-industrial diamonds, and gold to the United States; • a ban on “new investment” in the Russian Federation by a U.S. person, which may be interpreted broadly (with a similar prohibition also enacted by the United Kingdom); • bans on the provision of certain professional services, including accounting, trust and corporate formation, auditing, and management consulting services, among others; and • bans on the provision of services related to the worldwide maritime transportation of seaborne Russian oil, if purchased above a specific price cap.
The restrictions also include bans on the export of large numbers of “luxury” items to Russia (and in some cases also to Belarus), tighter controls on exports and reexports of dual-use items, stricter licensing policy with respect to issuing export licenses, and/or increased use of “end-use” controls to block or impose licensing requirements on exports, as well as higher import tariffs; • the closure of airspace to Russian aircraft; • ban on imports of Russian oil, liquefied natural gas, and coal to the United States and on “new investment” in Russia’s energy sector (often with similar bans being enacted in the United Kingdom and the European Union); • ban on imports of Russian fish, seafood, and preparations thereof, alcoholic beverages, non-industrial diamonds, and gold to the United States; • a ban on “new investment” in the Russian Federation by a U.S. person, which may be interpreted broadly (with a similar prohibition also enacted by the United Kingdom); • bans on the provision of certain professional services, including accounting, trust and corporate formation, auditing, and management consulting services, and information technology and software services, among others; and • bans on the provision of services related to the worldwide maritime transportation of seaborne Russian oil, if purchased above a specific price cap.
The trading price of our Class A common stock has fluctuated and may in the future fluctuate substantially in response to numerous factors in addition to the ones described in the preceding risk factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition, results of operations, or operating metrics and those of our competitors; • changes in our projected operating and financial results or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or variance in our financial performance from expectations of securities analysts; • changes in the pricing of our Digital Analytics Platform; • changes in the anticipated future size or growth rate of our addressable markets; • changes in laws or regulations applicable to our Digital Analytics Platform; • announcements by us or our competitors of significant business developments, acquisitions, or new offerings; • significant data breaches, disruptions to, or other incidents involving, our platform; • our involvement in litigation; • changes in our board of directors, senior management, or key personnel; • the number of shares of our Class A common stock made available for trading; • future sales of our Class A common stock by us or our stockholders; • the trading volume of our Class A common stock; • changes in the anticipated future size and growth rate of our market; • general economic, market, and industry conditions, including economic slowdowns, recessions, inflationary pressures, rising interest rates, financial market fluctuations, and reduced credit availability; • other events or factors, including those resulting from war or armed conflicts (including those in Ukraine and the Middle East), incidents of terrorism, pandemics (such as the COVID-19 pandemic or similar outbreaks of disease), elections, or responses to these events; and • whether investors or securities analysts view our stock structure unfavorably, particularly our dual class structure and the concentrated voting control of our executive officers, directors, and their affiliates.
The trading price of our Class A common stock has fluctuated and may in the future fluctuate substantially in response to numerous factors in addition to the ones described in the preceding risk factors, many of which are beyond our control, including: • actual or anticipated fluctuations in our financial condition, results of operations, or operating metrics and those of our competitors; • changes in our projected operating and financial results or our failure to meet these projections; • failure of securities analysts to initiate or maintain coverage of us, changes in financial estimates by any securities analysts who follow our company, or variance in our financial performance from expectations of securities analysts; • changes in the pricing of our Digital Analytics Platform; • changes in the anticipated future size or growth rate of our addressable markets; • changes in laws or regulations applicable to our Digital Analytics Platform; • announcements by us or our competitors of significant business developments, acquisitions, or new offerings; • significant data breaches, disruptions to, or other incidents involving, our platform; • our involvement in litigation; • changes in our board of directors, senior management, or key personnel; • the number of shares of our Class A common stock made available for trading; • future sales of our Class A common stock by us or our stockholders; • the trading volume of our Class A common stock; • changes in the anticipated future size and growth rate of our market; • general economic, market, and industry conditions, including economic slowdowns, recessions, inflationary pressures, rising interest rates, financial market fluctuations, and reduced credit availability; • other events or factors, including those resulting from war or armed conflicts (including those in Ukraine and the Middle East), incidents of terrorism, pandemics, elections, or responses to these events; and • whether investors or securities analysts view our stock structure unfavorably, particularly our dual class structure and the concentrated voting control of our executive officers, directors, and their affiliates.
To the extent that economic conditions deteriorate in the United States or abroad, including as a result of inflationary pressures and the responses by central banking authorities to control such inflation, rising interest rates, debt and equity market fluctuations, recent and potential bank failures, diminished liquidity and credit availability, increased unemployment rates, decreased investor and consumer confidence, political turmoil, supply chain challenges, natural catastrophes and the effects of climate change, regional and global conflicts, and terrorist attacks on the United States, Europe, the Asia-Pacific region, or elsewhere, our customers and prospective customers may go out of business or elect to decrease their budgets, which would limit our ability to grow our business and materially adversely affect our financial condition and results of operations.
To the extent that economic conditions deteriorate in the United States or abroad, including as a result of inflationary pressures and the responses by central banking authorities to control such inflation, rising interest rates, debt and equity market fluctuations, bank failures, diminished liquidity and credit availability, increased unemployment rates, decreased investor and consumer confidence, political turmoil, tariffs, supply chain challenges, natural catastrophes and the effects of climate change, regional and global conflicts, and terrorist attacks on the United States, Europe, the Middle East, the Asia-Pacific region, or elsewhere, our customers and prospective customers may go out of business or elect to decrease their budgets, which would limit our ability to grow our business and materially adversely affect our financial condition and results of operations.
We have completed a Section 382 study through December 31, 2022 and have determined that none of our NOLs generated through December 31, 2022, will expire solely due to Section 382 limitations caused by ownership changes prior to December 31, 2022. We are in the process of updating our Section 382 study through December 31, 2023.
We have completed a Section 382 study through December 31, 2023 and have determined that none of our NOLs generated through December 31, 2023 will expire solely due to Section 382 limitations caused by ownership changes prior to December 31, 2023. We are in the process of updating our Section 382 study through December 31, 2024.
Our effective tax rate could increase due to several factors, including: 37 • changes in the relative amounts of income before taxes in the various jurisdictions in which we operate that have differing statutory tax rates; • changes in tax laws, tax treaties, and regulations or the interpretation of them, such as the Tax Cuts and Jobs Act, the Coronavirus Aid, Relief, and Economic Security Act, and the Inflation Reduction Act; • changes to our assessment about our ability to realize our deferred tax assets that are based on estimates of our future results, the prudence and feasibility of possible tax planning strategies, and the economic and political environments in which we do business; • the outcome of current and future tax audits, examinations, or administrative appeals; and • the effects of acquisitions.
Our effective tax rate could increase due to several factors, including: • changes in the relative amounts of income before taxes in the various jurisdictions in which we operate that have differing statutory tax rates; • changes in tax laws, tax treaties, and regulations or the interpretation of them, such as the Tax Cuts and Jobs Act, the CARES Act, and the Inflation Reduction Act; 37 • changes to our assessment about our ability to realize our deferred tax assets that are based on estimates of our future results, the prudence and feasibility of possible tax planning strategies, and the economic and political environments in which we do business; • the outcome of current and future tax audits, examinations, or administrative appeals; and • the effects of acquisitions.
Sales of substantial amounts of our Class A common stock in the public markets, or the perception that sales might occur, could cause the trading price of our Class A common stock to decline. 40 In addition to the supply and demand and volatility factors discussed above, sales of a substantial number of shares of our Class A common stock into the public market, particularly sales by our directors, executive officers, and principal stockholders, or the perception that these sales might occur in large quantities, could cause the trading price of our Class A common stock to decline.
In addition to the supply and demand and volatility factors discussed above, sales of a substantial number of shares of our Class A common stock into the public market, particularly sales by our directors, executive officers, and principal stockholders, or the perception that these sales might occur in large quantities, could cause the trading price of our Class A common stock to decline.
In addition, independent industry analysts often provide reviews of our Digital Analytics Platform, as well as products and services offered by our competitors, and perception of our Digital Analytics Platform in the marketplace may be significantly influenced by these reviews.
In addition, independent industry analysts often provide reviews of our Digital Analytics Platform, as well as products and services offered by our competitors, and the market perception of our Digital Analytics Platform may be significantly influenced by these reviews.
We have also experienced, and may in the future experience, disruptions, outages, defects, and other performance and quality problems with the public cloud and internet infrastructure on which our platform relies.
We have experienced, and may in the future experience, disruptions, outages, defects, and other performance and quality problems with our platform or with the public cloud and internet infrastructure on which our platform relies.
We have, from time to time experienced, and we expect to continue to experience, difficulty in hiring and retaining employees with appropriate qualifications. The cost of living is high in the San Francisco Bay Area, which may make it harder for us to attract and retain highly skilled employees.
We have, from time to time experienced, and we may in the future experience, difficulty in hiring and retaining employees with appropriate qualifications. The cost of living is high in the San Francisco Bay Area, which may make it harder for us to attract and retain highly skilled employees.
As a result of these factors, in April 2023, we approved a restructuring plan to reduce our global workforce to improve operational efficiencies and reduce operating cost.
As a result of these factors, in April 2023, we approved a restructuring plan that reduced our global workforce to improve operational efficiencies and reduce operating cost.
Government), as a data transfer mechanism from the UK to U.S. entities self-certified under the DPF. As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.
Government), as a data transfer mechanism from the United Kingdom to U.S. entities self-certified under the DPF. As we continue to expand into other foreign countries and jurisdictions, we may be subject to additional laws and regulations that may affect how we conduct business.
Public health measures implemented to control COVID-19’s spread and severity substantially curtailed the movement of people, goods, and services worldwide, including regions where we and our partners and customers operate, and significantly impacted economic activity and financial markets.
For example, public health measures implemented to control COVID-19’s spread and severity substantially curtailed the movement of people, goods, and services worldwide, including in regions where we and our partners and customers operate, and significantly impacted economic activity and financial markets.
In connection with unfavorable macroeconomic conditions and the related impact on our customers, in April 2023, we authorized a restructuring plan to reduce our global workforce by approximately 13%. We cannot predict the timing, strength, or duration of any economic slowdown, instability, or recovery, generally or within any particular industry.
In connection with unfavorable macroeconomic conditions and the related impact on our customers, in April 2023, we authorized a restructuring plan that reduced our global workforce by approximately 13%. We cannot predict the timing, strength, or duration of any economic slowdown, instability, or recovery, generally or within any particular industry.
If our results of operations fall below the expectations of investors and securities analysts who follow our stock, the trading price of our Class A common stock could decline substantially, and we could face costly lawsuits, including securities class action litigation.
To the extent our results of operations fall below the expectations of investors and securities analysts who follow our stock, the trading price of our Class A common stock could decline substantially, and we could face costly lawsuits, including securities class action litigation.
For the years ended December 31, 2023 and 2022, our research and development expenses were 33% and 34% of our revenue, respectively. If we do not spend our research and development budget efficiently or effectively on compelling innovation and technologies, our business may be harmed. Moreover, research and development projects can be technically challenging and expensive.
For the years ended December 31, 2024 and 2023, our research and development expenses were 33% of our revenue. If we do not spend our research and development budget efficiently or effectively on compelling innovation and technologies, our business may be harmed. Moreover, research and development projects can be technically challenging and expensive.
Risks Related to Our Business and Industry We have a limited operating history and have been growing rapidly over the last several years, which makes it difficult to forecast our future results of operations and increases the risk of your investment. Our revenue was $276.3 million and $238.1 million for the fiscal years ended December 31, 2023 and 2022, respectively.
Risks Related to Our Business and Industry We have a limited operating history and have been growing rapidly over the last several years, which makes it difficult to forecast our future results of operations and increases the risk of your investment. Our revenue was $299.3 million and $276.3 million for the fiscal years ended December 31, 2024 and 2023, respectively.
We have previously been, and may in the future become, the target of cyberattacks by third parties seeking unauthorized access to our or our customers’ data or to disrupt our operations or ability to provide our services. We and certain of our vendors are from time to time subject to cyberattacks and security incidents.
We have previously been, and may in the future become, the target of cyberattacks by third parties seeking unauthorized access to our Confidential Information or to disrupt our operations or ability to provide our services. We and certain of our vendors are from time to time subject to cyberattacks and security incidents.
Even though we do not control the security measures of third parties who may have access to our customer data, our data, or our platform, we may be responsible for any breach of such measures or suffer reputational harm even where we do not have recourse to the third party that caused the breach.
Even though we do not control the security measures of third parties who may have access to our Confidential Information or our platform, we may be responsible for any breach of such measures or suffer reputational harm even where we do not have recourse to the third party that caused the breach.
Our operations are international in scope, and we plan further geographic expansion, creating a variety of operational challenges. For the years ended December 31, 2023 and 2022, 39% and 38% of our revenue was generated outside the United States, respectively.
Our operations are international in scope, and we plan further geographic expansion, creating a variety of operational challenges. For the years ended December 31, 2024 and 2023, 40% and 39% of our revenue was generated outside the United States, respectively.
As our costs increase, we may not be able to generate sufficient revenue to achieve and sustain profitability. We have experienced net losses in each period since inception. We generated net losses of $90.4 million and $93.4 million for the fiscal years ended December 31, 2023 and 2022, respectively.
As our costs increase, we may not be able to generate sufficient revenue to achieve and sustain profitability. We have experienced net losses in each period since inception. We generated net losses of $94.3 million and $90.4 million for the fiscal years ended December 31, 2024 and 2023, respectively.
While we do not believe that we have experienced any significant system failure, accident, or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our business operations, whether due to a loss, corruption, or unauthorized disclosure of our trade secrets, personal information, or other proprietary or sensitive information or other similar disruptions.
While we do not believe that we have experienced any significant system failure, accident, or security breach to date, if such an event were to occur and cause interruptions in our operations, it could result in a material disruption of our business operations, whether due to a loss, corruption, or unauthorized disclosure of our Confidential Information or other similar disruptions.
We agree to indemnify customers and other third parties, which exposes us to substantial potential liability. 30 Our contracts with customers and other third parties may include indemnification or other provisions under which we agree to indemnify or otherwise be liable to them for losses arising from alleged infringement, misappropriation, or other violation of intellectual property rights, data protection violations, breaches of representations and warranties, damage to property or persons, or other liabilities arising from our platform or such contracts.
Our contracts with customers and other third parties may include indemnification or other provisions under which we agree to indemnify or otherwise be liable to them for losses arising from alleged infringement, misappropriation, or other violation of intellectual property rights, data protection violations, breaches of representations and warranties, damage to property or persons, or other liabilities arising from our platform or such contracts.
We are reviewing and monitoring our contractual relationships with suppliers and customers to establish whether any are implicated by applicable sanctions. However, given the range of possible outcomes, the full costs, burdens, and limitations on our and our customer’s and business partners’ businesses are currently unknown and may become significant.
We continue to review and monitor our contractual relationships with suppliers and customers to establish whether any are implicated by applicable sanctions. However, given the range of possible outcomes, the full costs, burdens, and limitations on our and our customer’s and business partners’ businesses are currently unknown and may become significant.
Further, if we fail to detect or remediate a security breach in a timely manner, or a breach otherwise affects a large amount of data of one or more customers, or if we suffer a cyberattack that impacts our ability to operate our platform, we may suffer damage to our reputation and our brand, and our business, financial condition, and results of operations may be materially adversely affected.
Further, if we fail to detect or remediate a security breach in a timely manner, or a breach otherwise affects a large amount of Confidential Information, or if we suffer a cyberattack that impacts our ability to operate our platform, we may suffer damage to our reputation and our brand, and our business, financial condition, and results of operations may be materially adversely affected.
Additional financing may not be available on terms favorable to us, if at all. If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could materially adversely affect our business, financial condition, and results of operations.
If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could materially adversely affect our business, financial condition, and results of operations.
Our business and operations, and the businesses and operations of our partners and customers, have been, and could in the future be, adversely impacted by public health crises, including the COVID-19 pandemic.
Our business and operations, and the businesses and operations of our partners and customers, have been, and could in the future be, adversely impacted by public health crises.
Similar laws have been passed in other states and are continuing to be proposed at the state and federal level, reflecting a trend toward more stringent privacy legislation in the United States. The enactment of such laws may have potentially conflicting requirements that would make compliance challenging.
Additional compliance investment and potential business process changes may be required. Similar laws have been passed in other states and are 35 continuing to be proposed at the state and federal level, reflecting a trend toward more stringent privacy legislation in the United States. The enactment of such laws may have potentially conflicting requirements that would make compliance challenging.
In addition, we have filed registration statements to register all shares subject to options and RSUs outstanding or reserved for future issuance under our equity compensation plans.
In addition, we have filed registration statements to register all shares subject to options and restricted stock units (“RSU”) outstanding or reserved for future issuance under our equity compensation plans.
Factors that may influence the length and variability of our sales cycle include: • the need to educate prospective customers about the uses and benefits of our Digital Analytics Platform; • the discretionary nature of purchasing and budget cycles and decisions; • the competitive nature of evaluation and purchasing processes; • evolving functionality demands; • announcements or planned introductions of new products, features, or functionality by us or our competitors; and • lengthy purchasing approval processes. 20 Our increasing dependence on sales to larger organizations may increase the variability of our financial results.
Factors that may influence the length and variability of our sales cycle include: • the need to educate prospective customers about the uses and benefits of our Digital Analytics Platform; • the discretionary nature of purchasing and budget cycles and decisions; • the competitive nature of evaluation and purchasing processes; • evolving functionality demands; 18 • announcements or planned introductions of new products, features, or functionality by us or our competitors; and • lengthy purchasing approval processes.
For example, enterprise customers, which we define as customers with more than 1,500 employees, may require considerable time to evaluate and test our Digital Analytics Platform prior to making a purchase decision and placing an order.
For example, enterprise customers, which we define as customers with more than 1,000 employees or $100 million in revenue, may require considerable time to evaluate and test our Digital Analytics Platform prior to making a purchase decision and placing an order.
Any disruptions, outages, defects, and other performance and quality problems with our platform or with the public cloud and internet infrastructure on which it relies, or any material change in our contractual and other business relationships with any public cloud providers we contract with, could result in reduced use of our platform, increased expenses, including service credit obligations, and harm to our brand and reputation, any of which could have a material adverse effect on our business, financial condition, and results of operations.
Any disruptions, outages, defects, and other performance and quality problems with our platform or with the public cloud and internet infrastructure on which it relies, or any material change in our contractual and other business relationships with any public cloud providers we contract with, could result in reduced use of our platform, increased expenses, including service credit obligations, and harm to our brand and reputation, any of which could have a material adverse effect on our business, financial condition, and results of operations. 24 Real or perceived errors, failures, vulnerabilities or bugs in our platform could materially adversely affect our business and growth prospects.
Our risks are likely to increase as we continue to expand our platform, grow our customer base, and process, store, and transmit increasingly large amounts of proprietary and sensitive data.
Our risks are likely to increase as we continue to expand our platform, grow our customer base, and process, store, and transmit increasingly large amounts of Confidential Information.
The duration and extent of the impact of the COVID-19 pandemic and other potential public health crises cannot be accurately assessed or predicted at this time, and could adversely impact our business, financial condition, and results of operations.
The duration and extent of the impact of any public health crises cannot be accurately assessed or predicted at this time, and could adversely impact our business, financial condition, and results of operations.
If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings. We review our intangible assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill is required to be tested for impairment at least annually.
We review our intangible assets for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. Goodwill is required to be tested for impairment at least annually.
As of December 31, 2023, we had an accumulated deficit of $363.5 million. We expect our costs and expenses to increase in future periods.
As of December 31, 2024, we had an accumulated deficit of $457.8 million. We expect our costs and expenses to increase in future periods.
We may not have adequate or any insurance coverage and may be liable for up to the full amount of the indemnified claims, which could result in substantial liability or material disruption to our business or could negatively impact our relationships with customers or other third parties, reduce demand for our products, and materially adversely affect our business, financial condition, and results of operations.
We may not have adequate or any insurance coverage and may be liable for up to the full amount of the indemnified claims, which could result in substantial liability or material disruption to our business or could negatively impact our relationships with customers or other third parties, reduce demand for our products, and materially adversely affect our business, financial condition, and results of operations. 29 We may require additional capital to support the growth of our business, and this capital might not be available on acceptable terms, if at all.
Our results of operations may be materially adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the trading price of our Class A common stock.
Our results of operations may be materially adversely affected if our assumptions change or if actual circumstances differ from those in our assumptions, which could cause our results of operations to fall below the expectations of securities analysts and investors, resulting in a decline in the trading price of our Class A common stock. 38 If our goodwill or intangible assets become impaired, we may be required to record a significant charge to earnings.
While we have developed and continue to develop strategies to help mitigate any continuing negative effects of the COVID-19 pandemic and other potential public health crises on our business and operations, such efforts may prove to be insufficient to adequately address the negative impacts of the COVID-19 pandemic and other potential public health crises.
While we have developed, and continue to develop, strategies to help mitigate the negative effects of potential public health crises on our business and operations, such efforts may prove to be insufficient.
If our channel partners are unsuccessful in selling access to our Digital Analytics Platform, or if we are unable to enter into arrangements with or retain a sufficient number of high-quality channel partners in each of the regions in which we sell access to our Digital Analytics Platform and keep them motivated to sell access to our Digital Analytics Platform, our business, financial condition, results of operations, and growth prospects could be materially adversely affected. 27 If our marketing strategies are not effective in attracting new customers and retaining existing customers, our business and ability to grow our revenues would be harmed.
If our channel partners are unsuccessful in selling access to our Digital Analytics Platform, or if we are unable to enter into arrangements with or retain a sufficient number of high-quality channel partners in each of the regions in which we sell access to our Digital Analytics Platform and keep them motivated to sell access to our Digital Analytics Platform, our business, financial condition, results of operations, and growth prospects could be materially adversely affected.
For example, if we were required to move our headquarters or downsize our operations in the San Francisco Bay Area due to material adverse changes in the business, regulatory, or political climate, such as increases in local tax rates, we may lose key employees and incur significant costs of relocation.
For example, if we were required to move our headquarters or downsize our operations in the San Francisco Bay Area due to material adverse changes in the business, regulatory, or political climate, such as increases in local tax rates, we may lose key employees and incur significant costs of relocation. 43 Changes in laws and regulations related to the internet or changes in the internet infrastructure itself may diminish the demand for our Digital Analytics Platform, and could harm our business.
We may require additional capital to support the growth of our business, and this capital might not be available on acceptable terms, if at all. We intend to continue to make investments to support our business, which may require us to engage in debt or equity financings to secure additional funds.
We intend to continue to make investments to support our business, which may require us to engage in debt or equity financings to secure additional funds. Additional financing may not be available on terms favorable to us, if at all.
As of the date of this Annual Report on Form 10-K, our directors, executive officers, and holders of more than 5% of our capital stock and their affiliates collectively beneficially own, in the aggregate, shares representing a substantial majority of the combined voting power of our outstanding Class A and Class B common stock.
Our principal stockholders have the ability to influence the outcome of director elections and other matters requiring stockholder approval. 39 As of the date of this Annual Report on Form 10-K, our directors, executive officers, and holders of more than 5% of our capital stock and their affiliates collectively beneficially own, in the aggregate, shares representing a substantial majority of the combined voting power of our outstanding Class A and Class B common stock.
The use of these hedging instruments may not offset any, or more than a portion of, the adverse financial effects of unfavorable movements in foreign exchange rates over the limited time the hedges are in place, and may introduce additional risks if they are not structured effectively.
The use of these hedging instruments may not offset any, or more than a portion of, the adverse financial effects of unfavorable movements in foreign exchange rates over the limited time the hedges are in place, and may introduce additional risks if they are not structured effectively. 36 In addition, our international subsidiaries maintain net assets denominated in currencies other than the functional operating currencies of these entities.
Case law from the Court of Justice of the European Union (“CJEU”) states that reliance on the standard contractual clauses - a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism - alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis.
Case law from the CJEU states that reliance on the standard contractual clauses—a standard form of contract approved by the European Commission as an adequate personal data transfer mechanism—alone may not necessarily be sufficient in all circumstances and that transfers must be assessed on a case-by-case basis. The European Commission adopted its Adequacy Decision in relation to the new E.U.-U.S.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeOur cybersecurity risk management program includes: • risk assessments designed to help identify material cybersecurity risks to our critical systems, information, products, services, and our broader enterprise information technology environment; • a security team principally responsible for managing (i) our cybersecurity risk assessment processes, (ii) our security controls, and (iii) our response to cybersecurity incidents; • the use of external service providers, where appropriate, to assess, test or otherwise assist with aspects of our security controls; • cybersecurity awareness training of our employees, incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for service providers, suppliers, and vendors who have access to our critical systems and information.
Biggest changeKey elements of our cybersecurity risk management program include but are not limited to the following: • risk assessments designed to help identify material risks from cybersecurity threats to our critical systems, and information; • a security team principally responsible for managing (i) our cybersecurity risk assessment processes, (ii) our security controls, and (iii) our response to cybersecurity incidents; • the use of external service providers , where appropriate, to assess, test or otherwise assist with aspects of our security processes; • cybersecurity awareness training of our employees, including incident response personnel, and senior management; • a cybersecurity incident response plan that includes procedures for responding to cybersecurity incidents; and • a third-party risk management process for key service providers based on our assessment of their criticality to our operations and respective risk profile, suppliers, and vendors who have access to our critical systems and information.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
We have not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have material ly affected or are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
For more information, see the section titled “Risk Factor—Risks Related to Our Business Operations and Industry—If our information technology systems are breached or there is otherwise unauthorized disclosure of or access to customer data, our data, or our platform, our platform may be perceived as insecure, we may lose customers or fail to attract new customers, our reputation and brand may be harmed, and we may incur significant liabilities.” Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and oversees management’s implementation of our cybersecurity risk management program.
For more information, see the section titled “Risk Factor—Risks Related to Our Business Operations and Industry—If our information technology systems are breached or there is otherwise unauthorized disclosure of or access to customer data, our data, or our platform, our platform may be perceived as insecure, we may lose customers or fail to attract new customers, our reputation and brand may be harmed, and we may incur significant liabilities.” Cybersecurity Governance Our Board considers cybersecurity risk as part of its risk oversight function and established a dedicated Cybersecurity Committee of the Board in July 2024 to oversee cybersecurity risks, including management’s implementation of our cybersecurity risk management program.
Our management team supervises efforts to prevent, detect, mitigate, and 46 remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the information technology environment.
Our management team takes steps to stay informed about and monitor efforts to prevent, detect, mitigate, and remediate cybersecurity risks and incidents through various means, which may include briefings from internal security personnel; threat intelligence and other information obtained from governmental, public or private sources, including external consultants engaged by us; and alerts and reports produced by security tools deployed in the information technology environment.
We design and assess our program based on industry-standard frameworks, such as the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”), SOC2, ISO 27000, and ISO 27018.
Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. 45 We design and assess our program based on industry-standard frameworks, such as the National Institute of Standards and Technology Cybersecurity Framework (“NIST CSF”), SOC2, ISO 27000, and ISO 27018.
The team has primary responsibility for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants.
Our management team is responsible for assessing and managing our material risks from cybersecurity threats. Our Chief Engineering Officer and acting Chief Information Security Officer, Wade Chambers, reports to our Chief Executive Officer, and is primarily responsible for our overall cybersecurity risk management program and supervises both our internal cybersecurity personnel and our retained external cybersecurity consultants. Mr.
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Item 1C. Cybersecurity. Cybersecurity Risk Management and Strategy We have developed and implemented a cybersecurity risk management program intended to protect the confidentiality, integrity, and availability of our critical systems and information. Our cybersecurity risk management program includes a cybersecurity incident response plan.
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Our cybersecurity risk management program is part of our overall risk management program and shares similar governance processes and reporting channels that apply across the risk management program to financial, legal, compliance, and other operational risk areas.
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The Board receives periodic reports and presentations from management on our cybersecurity risks and cyber risk management program. In addition, management updates the Board, as necessary, regarding any material cybersecurity incidents, as well as any incidents with lesser impact potential. Our management team is responsible for assessing and managing our material risks from cybersecurity threats.
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We face risks from cybersecurity threats that, if realized, are reasonably likely to materially affect us, including our operations, business strategy, results of operations, or financial condition.
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Our management team’s experience includes more than 30 years in professional roles supporting and leading cybersecurity and cloud security programs for technology companies, including, (i) our Chief Information Security Officer (CISO), Dustin Pearce, who has previously led the Security and Governance, Risk, and Compliance (GRC) and Infrastructure functions, at Instacart and Slack, respectively, which included responsibility for assessing and managing various aspects of platform security for users, and (ii) our Executive Vice President of Engineering, Shadi Rostami, who has extensive experience in overseeing security for cloud services from an engineering perspective, including at Palo Alto Networks, while serving as Vice President of Engineering with responsibility for overseeing key cloud services, ensuring the security of cloud offerings and developing several cybersecurity solutions.
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The Cybersecurity Committee meets at least twice annually with management to review our cybersecurity risks and cyber risk management program , and periodically reports to the Board on its activity . In addition, management updates the Cybersecurity Committee and Board, where it deems appropriate, regarding any cybersecurity incidents it considers to be significant or potentially significant.
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Chambers previously served as the Chief Technology Officer and SVP of Engineering at Included Health. He also led engineering at Twitter, TellApart, Proofpoint, Yahoo, Opsware, and Netscape.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe may procure additional space in the future as we continue to add employees and expand geographically. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations.
Biggest changeWe may procure additional space in the future as we continue to add employees and expand geographically. We believe our facilities are adequate and suitable for our current needs and that, should it be needed, suitable additional or alternative space will be available to accommodate our operations. 46

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Item 3. Leg al Proceedings. From time to time, we may be subject to legal proceedings and claims in the ordinary course of business. On February 14, 2024, a putative securities class action (the “Putative Class Action”) was filed in the United States District Court for the Northern District of California captioned Fagan v.
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Item 3. Leg al Proceedings. See “Legal Matters” in Note 9 to our consolidated financial statements included in Part II, Item 8 of this Annual Report on Form 10-K. Item 4. Mine S afety Disclosures. Not Applicable. 47 PART II
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Amplitude, Inc., et al., Case No. 3:24-cv-00898, naming us, our Chief Executive Officer, and former Chief Financial Officer as defendants. The lawsuit is purportedly brought on behalf of all those who purchased or acquired our common stock between September 21, 2021 and February 16, 2022.
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The complaint alleges claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 based on allegedly false or misleading statements related to our business and financial outlook. The lawsuit seeks unspecified damages and other relief. The defendants intend to deny the allegations of wrongdoing and vigorously defend against the claims in the Putative Class Action.
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We have received, and may in the future continue to receive, claims from third parties asserting, among other things, infringement of their intellectual property rights. Future litigation may be necessary to defend ourselves, our partners and our customers by determining the scope, enforceability and validity of third-party proprietary rights, or to establish our proprietary rights.
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In addition to the matters discussed above, from time to time, we are party to litigation and other legal proceedings in the ordinary course of business.
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While we do not believe the ultimate resolution of pending legal matters is likely to have a material adverse effect on our financial position, the results of any litigation or other legal proceedings are uncertain and as such the resolution of such legal proceedings, either individually or in the aggregate, could have a material adverse effect on our business, results of operations, financial condition or cash flows.
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The Company records litigation accruals for legal matters, which are both probable and estimable.
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For legal proceedings for which there is a reasonable possibility of loss (meaning those losses for which the likelihood is more than remote but less than probable), the Company has determined that it does not have material exposure, or it is unable to develop a range of reasonably possible losses.
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Although no assurance may be given, the Company believes that it is not presently a party to any litigation of which the outcome, if determined adversely, would individually or in the aggregate be reasonably expected to have a material and adverse effect on the business, operating results, cash flows, or financial position. Item 4. Mine S afety Disclosures.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeOur Class B common stock is neither listed nor publicly traded. Holders of our Common Stock As of February 14, 2024, there were 27 holders of record of our Class A common stock and 32 holders of record of our Class B common stock.
Biggest changeOur Class B common stock is neither listed nor publicly traded. Holders of our Common Stock As of February 13, 2025, there were 31 holders of record of our Class A common stock and 28 holders of record of our Class B common stock.
The following graph compares (i) the cumulative total stockholder return on our Class A common stock from September 28, 2021 (the date our Class A common stock commenced trading on the Nasdaq Capital Market) through December 31, 2023 with (ii) the cumulative total return of the Nasdaq Composite Index and the Nasdaq Emerging Cloud Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on September 28, 2021 and the reinvestment of dividends.
The following graph compares (i) the cumulative total stockholder return on our Class A common stock from September 28, 2021 (the date our Class A common stock commenced trading on the Nasdaq Capital Market) through December 31, 2024 with (ii) the cumulative total return of the Nasdaq Composite Index and the Nasdaq Emerging Cloud Index over the same period, assuming the investment of $100 in our Class A common stock and in both of the other indices on September 28, 2021 and the reinvestment of dividends.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeGross margin increased in fiscal 2023 compared to fiscal 2022 mainly due to a decrease in our third-party hosting costs as a percentage of revenue and a decrease in personnel and related expenses as a result of our Restructuring Plan. 59 Operating Expenses Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Research and development $ 90,138 $ 80,589 $ 9,549 12% Sales and marketing 153,714 129,962 23,752 18% General and administrative 54,887 53,636 1,251 2% Restructuring and other related charges 8,142 — 8,142 * Total operating expenses $ 306,881 $ 264,187 $ 42,694 16% * Not meaningful Research and Development Research and development expenses increased $9.5 million, or 12%, in fiscal 2023 compared to fiscal 2022.
Biggest changeThe increase was partially offset by a decrease of $0.8 million in stock-based compensation expense and related payroll taxes. 59 Operating Expenses Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Research and development $ 97,565 $ 90,138 $ 7,427 8% Sales and marketing 168,306 153,714 14,592 9% General and administrative 63,860 54,887 8,973 16% Restructuring and other related charges — 8,142 (8,142 ) * Total operating expenses $ 329,731 $ 306,881 $ 22,850 7% * Not meaningful Research and Development Research and development expenses increased $7.4 million, or 8%, in fiscal 2024 compared to fiscal 2023.
Investing Activities Net cash provided by investing activities of $9.3 million for fiscal 2023 consisted of $12.5 million of cash received from the maturities of marketable securities, offset by $1.9 million of capitalized internal-use software development costs, and $1.3 million in purchases of property and equipment.
Net cash provided by investing activities of $9.3 million for fiscal 2023 consisted of $12.5 million of cash received from the maturities of marketable securities, offset by $1.9 million of capitalized internal-use software development costs, and $1.3 million in purchases of property and equipment.
Financing Activities Net cash used in financing activities of $4.9 million for fiscal 2023 primarily consisted of $4.6 million in proceeds from the exercise of stock options offset by $8.9 million in net tax remittance on equity awards primarily driven by a change in tax withholding settlement method related to vesting of RSU awards from sell-to-cover to withhold-to-cover that occurred in the year ended December 31, 2023.
Net cash used in financing activities of $4.9 million for fiscal 2023 primarily consisted of $4.6 million in proceeds from the exercise of stock options offset by $8.9 million in net tax remittance on equity awards primarily driven by a change in tax withholding settlement method related to vesting of RSU awards from sell-to-cover to withhold-to-cover that occurred in the year ended December 31, 2023.
ARR should be viewed independently of revenue, and does not represent our U.S. GAAP revenue on an annualized basis, as 52 it is an operating metric that can be impacted by contract start and end dates and renewal rates. ARR is also not intended to be a forecast of revenue.
ARR should be viewed independently of revenue, and does not represent our 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. ARR is also not intended to be a forecast of revenue.
Historically, overage charges have not made up a significant portion of our revenue. In many cases, customers will proactively expand their contract within the contract term, generally increasing event or MTU volume and platform capabilities to expand existing or address new use cases. Substantially all of our customer contracts have a subscription period of one year or longer.
Historically, overage charges have not made up a significant portion of our revenue. In many cases, customers will proactively expand their contract within the contract term, generally increasing event or MTU volume and platform capabilities to expand existing or address new use cases. Substantially all of our sales led customer contracts have a subscription period of one year or longer.
Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere in this Annual Report on Form 10-K. 62 Contractual Obligations and Commitments As of December 31, 2023, the contractual commitment amounts in the table below are associated with agreements that are enforceable and legally binding.
Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere in this Annual Report on Form 10-K. 62 Contractual Obligations and Commitments As of December 31, 2024, the contractual commitment amounts in the table below are associated with agreements that are enforceable and legally binding.
Our self-serve Plus plan is built for growing startups and small 50 teams who need more customization and access to feature management and CDP capabilities. Our Growth plan provides access to additional capabilities, such as automated insights, experiments, and audience management. Users also get access to dedicated customer support to further maximize the value from our platform.
Our self-serve Plus plan is built for growing startups and small teams who need more customization and access to feature management capabilities. Our Growth plan provides access to additional capabilities, such as automated insights, experiments, and audience management. Users also get access to dedicated customer support to further maximize the value from our platform.
We architected our Behavioral Graph to power numerous products, beginning with our core product analytics platform. Consistently ranked #1 in multiple categories by G2, Amplitude Analytics provides real-time product data and reconstructed user visits so cross-functional teams can understand what is working and what is not.
We architected our Behavioral Graph to power numerous products, beginning with our core product analytics solution. Consistently ranked #1 in multiple categories by G2, Amplitude Analytics provides real-time product data and reconstructed user visits so cross-functional teams can understand what is working and what is not.
And our Enterprise plan is designed for larger organizations that have more sophisticated needs and requirements, and includes everything in the Growth plan as well as additional robust features such as advanced data governance, custom user permissions and roles, automated insights, and more.
And our Enterprise plan is designed for larger organizations that have more sophisticated needs and requirements, and includes everything in the Growth plan as well as additional robust features such as advanced data governance, custom user permissions and roles, automated insights, enterprise-grade security features, and more.
The period-to-period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods. The following discussion and analysis are for the year ended December 31, 2023, compared to the same period in 2022, unless otherwise stated.
The period-to-period comparison of financial results is not necessarily indicative of financial results to be achieved in future periods. The following discussion and analysis are for the year ended December 31, 2024, compared to the same period in 2023, unless otherwise stated.
In the fiscal year ended December 31, 2023, we billed a majority of these contracts annually in advance with the remainder billed quarterly, semi-annually, or monthly. We offer a variety of free and paid plans depending on our customers’ needs wherever they are in their analytics journey. For example, we offer a Free plan for early-stage startups and individuals.
In the fiscal year ended December 31, 2024, we billed a majority of these contracts annually in advance with the remainder billed quarterly, semi-annually, or monthly. 50 We offer a variety of free and paid plans depending on our customers’ needs wherever they are in their analytics journey. For example, we offer a Free plan for early-stage startups and individuals.
The typical subscription term is 12 months with various payment terms ranging from monthly to annual up-front payments. Most contracts are non-cancellable over the contractual term and are subject to standard terms and conditions; however, certain contracts contain nonstandard terms that may impact the timing of revenue recognition.
Typical subscription terms are in increments of 12 months with various payment terms ranging from monthly to annual up-front payments. Most contracts are non-cancellable over the contractual term and are subject to standard terms and conditions; however, certain contracts contain nonstandard terms that may impact the timing of revenue recognition.
Our ability to expand within our customer base is also demonstrated by our strong dollar-based net retention rate. As of December 31, 2023 and 2022, our dollar-based net retention rate (TTM) across paying customers was 101% and 119%, respectively. Key Factors Affecting Our Performance We believe that the growth and future success of our business depends on many factors.
Our ability to expand within our customer base is also demonstrated by our strong dollar-based net retention rate. As of December 31, 2024 and 2023, our dollar-based net retention rate (TTM) across paying customers was 97% and 101%, respectively. Key Factors Affecting Our Performance We believe that the growth and future success of our business depends on many factors.
For example, as a result of the Russia-Ukraine war, we terminated certain relationships with customers in Russia and some of the businesses of our customers in the impacted regions have experienced disruptions that have affected their ability to pay for our services.
For example, as a result of the Russia-Ukraine war and related sanctions, we have terminated certain relationships with customers in Russia. Some of the businesses of our customers in the impacted regions have also experienced disruptions that have affected their ability to pay for our services.
Our Business Model We generate revenue primarily through selling subscriptions to our platform. We reach customers through a direct sales motion, solution partners, and product-led growth initiatives, including subscription plans to meet the needs of a diverse range of companies. For the year ended December 31, 2023, subscription revenue comprised 97% of our total revenue.
Our Business Model We generate revenue primarily through selling subscriptions to our platform. We reach customers through a direct sales motion, solution partners, and product-led growth initiatives, including subscription plans to meet the needs of a diverse range of companies. For the year ended December 31, 2024, subscription revenue comprised 98% of our total revenue.
Non-GAAP Financial Measures and related Non-GAAP reconciliations for the year ended December 31, 2022 compared to the year ended December 31, 2021 may be found in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 16, 2023.
Non-GAAP Financial Measures and related Non-GAAP reconciliations for the year ended December 31, 2023 compared to the year ended December 31, 2022 may be found in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 20, 2024.
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. No single customer accounted for more than 3% and 4% of our revenue in the years ended December 31, 2023 and 2022, respectively.
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. No single customer accounted for more than 3% of our revenue in the years ended December 31, 2024 and 2023.
Discussion and analysis for the year ended December 31, 2022 compared to the year ended December 31, 2021 may be found in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022, filed with the SEC on February 16, 2023.
Discussion and analysis for the year ended December 31, 2023 compared to the year ended December 31, 2022 may be found in the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023, filed with the SEC on February 20, 2024.
We define ARR as the annual recurring revenue of subscription agreements, including certain premium professional services that are subject to contractual subscription terms, at a point in time based on the terms of customers’ contracts. ARR should be viewed independently of revenue, and does not represent our U.S.
We define ARR as the annual recurring revenue of subscription agreements at a point in time based on the terms of customers’ contracts, including certain premium services that are subject to contractual subscription terms and Plus customers that we expect to recur. ARR should be viewed independently of revenue, and does not represent our U.S.
We have since expanded our offerings to include products that enable teams to build personalized product experiences, test product changes, and improve data quality across their technology stack. We have experienced significant growth in recent years driven by the rapid adoption of our Digital Analytics Platform by our global, diversified base of 2,723 paying customers as of December 31, 2023.
We have since expanded our offerings to include products that enable teams to build personalized product experiences, test product changes, and improve data quality across their technology stack. We have experienced significant growth in recent years driven by the rapid adoption of our Digital Analytics Platform by our global, diversified base of 3,875 paying customers as of December 31, 2024.
Although there have been recent cost savings due to our restructuring, we expect our general and administrative expenses to continue to increase in dollar amount over time but to generally decrease as a percentage of our revenue over the longer term, though the percentage may fluctuate from period to period depending on the timing and amount of our general and administrative expenses, including in the short term.
Although we previously experienced cost savings due to our restructuring, we expect our general and administrative expenses to continue to increase in dollar amount over time but to generally decrease as a percentage of our revenue over the longer term, though the percentage may fluctuate from period to period depending on the timing and amount of our general and administrative expenses, including in the short term.
Although there have been recent cost savings due to our restructuring, we expect our sales and marketing expenses to continue to increase in dollar amount but to decrease as a percentage of revenue over the longer term, though the percentage may fluctuate from quarter to quarter depending on the extent and timing of our marketing initiatives.
Although we previously experienced cost savings due to our restructuring, we expect our sales and marketing expenses to continue to increase in dollar amount but to decrease as a percentage of revenue over the longer term, though the percentage may fluctuate from quarter to quarter depending on the extent and timing of our marketing initiatives.
Pursuant to the terms of the contract, we are required to spend a minimum of $267 million over the five-year term of the contract. As of December 31, 2023, we had $174 million remaining on this commitment.
Pursuant to the terms of the contract, we are required to spend a minimum of $267 million over the five-year term of the contract. As of December 31, 2024, we had $123 million remaining on this commitment.
We work with more than 2,700 paying customers of various sizes and stages of digital maturity, across many industries, including the teams behind some of the most-beloved digital products in the world. We have experienced significant growth in recent years, with approximately 675 employees in seven global offices.
We work with more than 3,800 paying customers of various sizes and stages of digital maturity, across many industries, including the teams behind some of the most-beloved digital products in the world. We have experienced significant growth in recent years, with approximately 725 employees in seven global offices.
The increase was primarily due to an increase of $12.8 million in stock-based compensation expenses and related payroll taxes and an increase of $8.5 million in personnel and related expenses, including an increase in allocated overhead costs.
The increase was primarily due to an increase of $8.0 million in personnel and related expenses, including an increase in allocated overhead costs and an increase of $2.8 million in stock-based compensation expenses and related payroll taxes.
For the year ended December 31, 2023, we have generated positive cash flow from operating activities; however, in the past several years, we generated negative cash flows from operating activities and have supplemented working capital requirements through net proceeds from the sale of preferred stock and common stock. 61 Net cash provided by operating activities of $25.6 million for fiscal 2023 reflects our net loss of $90.4 million, adjusted by non-cash items such as stock-based compensation expense of $88.3 million, depreciation and amortization of $5.6 million, and non-cash operating lease costs of $3.9 million as well as net cash provided by changes in our operating assets and liabilities of $18.5 million.
For the years ended December 31, 2024 and 2023, we have generated positive cash flow from operating activities; however, in the past several years, we generated negative cash flows from operating activities and have supplemented working capital requirements through net proceeds from the sale of preferred stock and common stock. 61 Net cash provided by operating activities of $18.5 million for fiscal 2024 reflects our net loss of $94.3 million, adjusted by non-cash items such as stock-based compensation expense of $100.0 million, depreciation and amortization of $6.1 million, and non-cash operating lease costs of $4.0 million as well as net cash provided by changes in our operating assets and liabilities of $2.4 million.
See “Risk Factors—Risks Related to Our Business and Industry—We may require additional capital to support the growth of our business, and this capital might not be available on acceptable terms, if at all.” Cash Flows The following table shows a summary of our cash flows for the periods presented: Year Ended December 31, 2023 2022 (in thousands) Net cash provided by (used in) operating activities $ 25,630 $ (5,384 ) Net cash provided by (used in) investing activities $ 9,317 $ (89,393 ) Net cash provided by (used in) financing activities $ (4,936 ) $ 5,831 Operating Activities Our largest source of operating cash is cash collection from sales of subscriptions to our paying customers.
See “Risk Factors—Risks Related to Our Business and Industry—We may require additional capital to support the growth of our business, and this capital might not be available on acceptable terms, if at all.” Cash Flows The following table shows a summary of our cash flows for the periods presented: Year Ended December 31, 2024 2023 (in thousands) Net cash provided by (used in) operating activities $ 18,506 $ 25,630 Net cash provided by (used in) investing activities $ (75,366 ) $ 9,317 Net cash provided by (used in) financing activities $ (19,941 ) $ (4,936 ) Operating Activities Our largest source of operating cash is cash collection from sales of subscriptions to our paying customers.
In comparison, we had 480 customers that each represented greater than $100,000 in ARR and 30 customers that each represented greater than $1 million in ARR for the years ended December 31, 2022. Customers that each represented greater than $100,000 in ARR accounted for approximately 74% and 75% of our total ARR as of December 31, 2023 and 2022, respectively.
In comparison, we had 511 customers that each represented greater than $100,000 in ARR and 39 customers that each represented greater than $1 million in ARR for the years ended December 31, 2023. Customers that each represented greater than $100,000 in ARR accounted for approximately 75% and 74% of our total ARR as of December 31, 2024 and 2023, respectively.
Our customers span across industries and sizes, from the leading digital innovators to those earlier in their digital transformation journey. For the years ended December 31, 2023 and 2022, our revenue was $276.3 million and $238.1 million, respectively, representing year-over-year growth of 16%.
Our customers span across industries and sizes, from the leading digital innovators to those earlier in their digital transformation journey. For the years ended December 31, 2024 and 2023, our revenue was $299.3 million and $276.3 million, respectively, representing year-over-year growth of 8%.
As of December 31, 2023, we had $102.6 million of deferred revenue, all of which was recorded as a current liability. This deferred revenue will be recognized as revenue when or as the related performance obligations are met.
As of December 31, 2024, we had $109.7 million of deferred revenue, all of which was recorded as a current liability. This deferred revenue will be recognized as revenue when or as the related performance obligations are met.
For purposes of customer count, a customer is defined as an entity that has a unique Dunn & Bradstreet Global Ultimate (“GULT”) Data Universal Numbering System (“DUNS”) number and an active subscription contract as of the measurement date. The DUNS number is a global standard for business identification and tracking.
Paying Customers with ARR of $100,000 or greater For purposes of customer count, a customer is defined as an entity that has a unique Dunn & Bradstreet Global Ultimate (“GULT”) Data Universal Numbering System (“DUNS”) number and an active subscription contract as of the measurement date. The DUNS number is a global standard for business identification and tracking.
As of December 31, 2023, we had 511 customers that each represented greater than $100,000 in ARR and 39 customers that each represented greater than $1 million in ARR, demonstrating the mission critical nature of our platform to help customers succeed in the new digital age.
As of December 31, 2024, we had 591 paying customers that each represented greater than $100,000 in ARR and 42 customers that each represented greater than $1 million in ARR, demonstrating the mission critical nature of our platform to help customers succeed in the new digital age.
We have a history of, and will continue to invest significantly in, developing and delivering innovative products, features, and functionality targeted at our core customer base. In addition, we may choose to add new products and offerings or enhance our platform capabilities through acquisitions. In recent years, we have acquired companies to bolster our predictive analytics and data instrumentation capabilities.
We have a history of, and will continue to invest significantly in, developing and delivering innovative products, features, and functionality targeted at our core customer base. In addition, we may choose to add new products and offerings or enhance our platform capabilities through acquisitions.
Although there have been recent cost savings due to our restructuring, we anticipate continuing to invest in innovation and technology development, and as a result, we expect research and development expenses to increase in dollar amount but to decrease as a percentage of revenue over the longer term, though the percentage may fluctuate from quarter to quarter depending on the extent and 56 timing of product development initiatives.
We anticipate continuing to invest in innovation and technology development, and as a result, we expect research and 56 development expenses to increase in dollar amount but to decrease as a percentage of revenue over the longer term, though the percentage may fluctuate from quarter to quarter depending on the extent and timing of product development initiatives.
Although there have been recent cost savings due to our restructuring, as we continue to invest in our sales efforts, we expect our sales and marketing expenses to increase in dollar amount over time.
Although we previously experienced cost savings due to our restructuring, as we continue to invest in our sales efforts, we expect our sales and marketing expenses to increase in dollar amount over time.
We have generated losses from our operations as reflected in our accumulated deficit of $363.5 million as of December 31, 2023. We generated positive cash flows from operating activities during the year ended December 31, 2023; however, we have historically generated negative cash flows from operating activities.
We have generated losses from our operations as reflected in our accumulated deficit of $457.8 million as of December 31, 2024. We generated positive cash flows from operating activities during the years ended December 31, 2024 and 2023; however, we have historically generated negative cash flows from operating activities.
As of December 31, 2023, our principal sources of liquidity were cash and cash equivalents of $248.5 million and restricted cash of $0.9 million. We also had $73.9 million in marketable securities that provide additional capital resources.
As of December 31, 2024, our principal sources of liquidity were cash and cash equivalents of $171.7 million and restricted cash of $0.9 million. We also had $126.7 million in marketable securities that provide additional capital resources.
Non-GAAP Income (Loss) From Operations and Income (Loss) From Operations Margin Year Ended December 31, 2023 2022 (in thousands) Income (loss) from operations $ (102,520 ) $ (96,562 ) Add: Stock-based compensation expense (1) $ 89,472 $ 68,297 Acquired intangible assets amortization $ 1,413 $ 2,017 Restructuring and other related charges $ 8,142 $ — Non-GAAP Income (Loss) from Operations $ (3,493 ) $ (26,248 ) Non-GAAP Income (Loss) from Operations Margin (1 )% (11 )% (1) Stock-based compensation expense-related charges include employer payroll tax-related expenses on employee stock transactions, but exclude stock-based compensation costs included in Restructuring and Other Related Charges. 55 Free Cash Flow and Free Cash Flow Margin Year Ended December 31, 2023 2022 (in thousands, except percentages) Net cash provided by (used in) investing activities $ 9,317 $ (89,393 ) Net cash provided by (used in) financing activities $ (4,936 ) $ 5,831 Net cash provided by (used in) operating activities $ 25,630 $ (5,384 ) Less: Purchase of property and equipment $ (1,279 ) $ (3,632 ) Capitalization of internal-use software costs $ (1,904 ) $ (2,177 ) Free Cash Flow $ 22,447 $ (11,193 ) Free Cash Flow Margin 8 % (5 )% Components of Results of Operations Revenue We generate revenue primarily from sales of subscription services for customers to access our platform.
Non-GAAP Income (Loss) From Operations and Income (Loss) From Operations Margin Year Ended December 31, 2024 2023 (in thousands, except percentages) Income (loss) from operations $ (107,383 ) $ (102,520 ) Add: Stock-based compensation expense (1) $ 102,645 $ 89,472 Acquired intangible assets amortization $ 734 $ 1,413 Restructuring and other related charges $ — $ 8,142 Non-GAAP Income (Loss) from Operations $ (4,004 ) $ (3,493 ) Non-GAAP Income (Loss) from Operations Margin (1 )% (1 )% (1) Stock-based compensation expense-related charges include employer payroll tax-related expenses on employee stock transactions, but exclude stock-based compensation costs included in Restructuring and Other Related Charges. 55 Free Cash Flow and Free Cash Flow Margin Year Ended December 31, 2024 2023 (in thousands, except percentages) Net cash provided by (used in) investing activities $ (75,366 ) $ 9,317 Net cash provided by (used in) financing activities $ (19,941 ) $ (4,936 ) Net cash provided by (used in) operating activities $ 18,506 $ 25,630 Less: Purchase of property and equipment $ (1,725 ) $ (1,279 ) Capitalization of internal-use software costs $ (5,053 ) $ (1,904 ) Free Cash Flow $ 11,728 $ 22,447 Free Cash Flow Margin 4 % 8 % Components of Results of Operations Revenue We generate revenue primarily from sales of subscription services for customers to access our platform.
Year Ended December 31, 2023 2022 (in thousands, except percentages) Revenue 100% 100% Cost of revenue 26% 30% Gross margin 74% 70% Operating expenses: Research and development 33% 34% Sales and marketing 56% 55% General and administrative 20% 23% Restructuring and other related charges 3% * Total operating expenses 111% 111% Loss from operations (37)% (41)% Other income (expense), net 5% 2% Loss before provision for (benefit from) income taxes (32)% (39)% Provision for (benefit from) income taxes * * Net loss (33)% (39)% * Less than 1% Note: Certain figures may not sum due to rounding Comparison of Fiscal Years Ended December 31, 2023 and 2022 Revenue Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Revenue $ 276,284 $ 238,067 $ 38,217 16% Revenue increased $38.2 million, or 16%, in fiscal 2023 compared to fiscal 2022.
Year Ended December 31, 2024 2023 Revenue 100% 100% Cost of revenue 26% 26% Gross margin 74% 74% Operating expenses: Research and development 33% 33% Sales and marketing 56% 56% General and administrative 21% 20% Restructuring and other related charges * 3% Total operating expenses 110% 111% Loss from operations (36)% (37)% Other income (expense), net 5% 5% Loss before provision for (benefit from) income taxes (31)% (32)% Provision for (benefit from) income taxes 1% * Net loss (32)% (33)% * Less than 1% Note: Certain figures may not sum due to rounding Comparison of Fiscal Years Ended December 31, 2024 and 2023 Revenue Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Revenue $ 299,272 $ 276,284 $ 22,988 8% Revenue increased $23.0 million, or 8%, in fiscal 2024 compared to fiscal 2023.
Our pricing model is based on both the platform functionality required by our customers as well as committed volume of events or monthly tracked users ("MTUs"). An event could be any action that a user takes in a digital product, such as ‘Create account’, ‘Add to cart’, or ‘Share photo’.
Our pricing model is based on the platform functionality that our customers require to get the insights that they need and our customers commit to a certain volume of events or monthly tracked users ("MTUs"). An event could be any action that a user takes in a digital product, such as ‘Create account’, ‘Add to cart’, or ‘Share photo’.
Paying Customers We believe our ability to grow the number of paying customers on our platform provides a key indicator of the demand for our platform, growth of our business, and our future business opportunities.
We believe our ability to grow the number of paying customers on our platform, particularly those spending $100,000 or more a year, provides a key indicator of the demand for our platform, growth of our business, and our future business opportunities.
For the years ended December 31, 2023 and 2022, our net loss was $90.4 million and $93.4 million, respectively. For the years ended December 31, 2023 and 2022, our net cash provided by (used in) operating activities was $25.6 million and $(5.4) million, respectively, and our free cash flow was $22.4 million and $(11.2) million, respectively.
For the years ended December 31, 2024 and 2023, our net loss was $94.3 million and $90.4 million, respectively. For the years ended December 31, 2024 and 2023, our net cash provided by operating activities was $18.5 million and $25.6 million, respectively, and our free cash flow was $11.7 million and $22.4 million, respectively.
GAAP, we believe these non-GAAP financial measures are useful in evaluating our operating performance. See below for a description of the non-GAAP financial measures and their limitations as an analytical tool. A reconciliation is also provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP.
GAAP measure, for each period presented below. In addition to our results determined in accordance with U.S. GAAP, we believe these non-GAAP financial measures are useful in evaluating our operating performance. See below for a description of the non-GAAP financial measures and their limitations as an analytical tool.
As of December 31, 2023 and 2022, 26 and 28 of the Fortune 100 were paying customers, respectively, with two of our customers falling out of the Fortune 100 list in the year ended December 31, 2023, which demonstrates both our traction to date as well as our significant opportunity to continue to penetrate into the largest global organizations.
As of December 31, 2024 and 2023, 27 and 26 of the Fortune 100 were paying customers, respectively, which demonstrates both our traction to date as well as our significant opportunity to continue to penetrate into the largest global organizations.
Net cash used in operating activities of $5.4 million for fiscal 2022 reflects our net loss of $93.4 million, adjusted by non-cash items such as stock-based compensation expense of $67.2 million, depreciation and amortization of $4.7 million, and non-cash operating lease costs of $3.7 million as well as net cash provided by changes in our operating assets and liabilities of $12.3 million.
Net cash provided by operating activities of $25.6 million for fiscal 2023 reflects our net loss of $90.4 million, adjusted by non-cash items such as stock-based compensation expense of $88.3 million, depreciation and amortization of $5.6 million, and non-cash operating lease costs of $3.9 million as well as net cash provided by changes in our operating assets and liabilities of $18.5 million.
Remaining Performance Obligations Remaining performance obligations (“RPO”) as of December 31, 2023 and 2022, including the expected timing of recognition, is as follows: As of December 31, 2023 2022 % Change Less than or equal to 12 months $ 188,456 $ 190,595 (1)% Greater than 12 months 50,962 57,581 (11)% Total remaining performance obligations $ 239,418 $ 248,176 (4)% Our RPO represents the amount of contracted future revenue that has not yet been recognized, including both deferred revenue and non-cancellable contracted amounts that will be invoiced and recognized as revenue in future periods.
Remaining Performance Obligations Remaining performance obligations (“RPO”) as of December 31, 2024 and 2023, including the expected timing of recognition, is as follows: As of December 31, 2024 2023 % Change (in thousands, except percentages) Less than or equal to 12 months $ 223,320 $ 188,456 18% Greater than 12 months 85,315 50,962 67% Total remaining performance obligations $ 308,635 $ 239,418 29% Our RPO represents the amount of contracted future revenue that has not yet been recognized, including both deferred revenue and non-cancellable contracted amounts that will be invoiced and recognized as revenue in future periods.
General and Administrative General and administrative expenses increased $1.3 million, or 2%, in fiscal 2023 compared to fiscal 2022.The increase was primarily attributable to an increase of $2.7 million in personnel and related expenses, including an increase in allocated overhead costs. The increase was partially offset by a decrease of $1.5 million in stock-based compensation expense and related payroll taxes.
General and Administrative General and administrative expenses increased $9.0 million, or 16%, in fiscal 2024 compared to fiscal 2023. The increase was primarily attributable to an increase of $3.8 million in personnel and related expenses, including an increase in allocated overhead costs and an increase of $3.1 million in stock-based compensation expense and related payroll taxes.
Non-GAAP Gross Profit and Gross Margin Year Ended December 31, 2023 2022 (in thousands) Gross profit $ 204,361 $ 167,625 Add: Stock-based compensation expense (1) $ 7,300 $ 6,468 Acquired intangible assets amortization $ 1,238 $ 2,017 Non-GAAP Gross Profit $ 212,899 $ 176,110 Non-GAAP Gross Margin 77 % 74 % (1) Stock-based compensation expense-related charges include employer payroll tax-related expenses on employee stock transactions.
Non-GAAP Gross Profit and Gross Margin Year Ended December 31, 2024 2023 (in thousands, except percentages) Gross profit $ 222,348 $ 204,361 Add: Stock-based compensation expense (1) $ 6,472 $ 7,300 Acquired intangible assets amortization $ 490 $ 1,238 Non-GAAP Gross Profit $ 229,310 $ 212,899 Non-GAAP Gross Margin 77 % 77 % (1) Stock-based compensation expense-related charges include employer payroll tax-related expenses on employee stock transactions.
Cost of Revenue and Gross Margin Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Cost of revenue $ 71,923 $ 70,442 $ 1,481 2% Gross margin 74 % 70 % N/A N/A Cost of revenue increased $1.5 million, or 2%, in fiscal 2023 compared to fiscal 2022.
Cost of Revenue and Gross Margin Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Cost of revenue $ 76,924 $ 71,923 $ 5,001 7% Gross margin 74 % 74 % N/A N/A Cost of revenue increased $5.0 million, or 7%, in fiscal 2024 compared to fiscal 2023.
Increasing awareness of our platform and its broad range of capabilities, coupled with the mainstream adoption of cloud-based technology, has expanded the diversity of our customer base to include organizations of different sizes across virtually all industries.
Increasing awareness of our platform and its broad range of capabilities, coupled with the mainstream adoption of cloud-based technology, has expanded the diversity of our customer base to include organizations of different sizes across virtually all industries. 53 Non-GAAP Financial Measures The following table presents certain non-GAAP financial measures, along with the most directly comparable U.S.
For example, in October 2023, we introduced Plus to bring the full power of digital analytics to every team for less. We believe the evolution of our technology and product offerings will lead to continued increased retention and positive customer referrals that will continue to generate expansion opportunities within our existing installed base and from new customers.
We believe the evolution of our technology and product offerings will lead to increased retention and positive customer referrals that will continue to generate expansion opportunities within our existing installed base and from new customers.
The increase was primarily due to an increase of $0.8 million in stock-based compensation expense and related payroll taxes, and an increase of $0.3 million in third-party hosting costs as we increased capacity to support paying customer usage and growth of our paying customer base.
The increase was primarily due to an increase of $3.2 million in third-party hosting costs as we increased capacity to support paying customer usage and growth of our paying customer base and $2.5 million in personnel and related expenses, including an increase in allocated overhead costs.
Year Ended December 31, 2023 2022 (in thousands, except percentages) Gross Profit $ 204,361 $ 167,625 Non-GAAP Gross Profit $ 212,899 $ 176,110 Gross Margin 74 % 70 % Non-GAAP Gross Margin 77 % 74 % Loss from Operations $ (102,520 ) $ (96,562 ) Non-GAAP Income (Loss) from Operations $ (3,493 ) $ (26,248 ) Loss from Operations Margin (37 )% (41 )% Non-GAAP Income (Loss) from Operations Margin (1 )% (11 )% Net Cash Provided by (Used in) Operating Activities $ 25,630 $ (5,384 ) Free Cash Flow $ 22,447 $ (11,193 ) Net Cash Provided by (Used in) Operating Activities Margin 9 % (2 )% Free Cash Flow Margin 8 % (5 )% Non-GAAP Gross Profit, Non-GAAP Gross Margin, Non-GAAP Income (Loss) from Operations, and Non-GAAP Income (Loss) from Operations Margin We define non-GAAP gross profit and non-GAAP gross margin as U.S.
Year Ended December 31, 2024 2023 (in thousands, except percentages) Gross Profit $ 222,348 $ 204,361 Non-GAAP Gross Profit $ 229,310 $ 212,899 Gross Margin 74 % 74 % Non-GAAP Gross Margin 77 % 77 % Loss from Operations $ (107,383 ) $ (102,520 ) Non-GAAP Income (Loss) from Operations $ (4,004 ) $ (3,493 ) Loss from Operations Margin (36 )% (37 )% Non-GAAP Income (Loss) from Operations Margin (1 )% (1 )% Net Cash Provided by (Used in) Operating Activities $ 18,506 $ 25,630 Free Cash Flow $ 11,728 $ 22,447 Net Cash Provided by (Used in) Operating Activities Margin 6 % 9 % Free Cash Flow Margin 4 % 8 % Non-GAAP Gross Profit, Non-GAAP Gross Margin, Non-GAAP Income (Loss) from Operations, and Non-GAAP Income (Loss) from Operations Margin We define non-GAAP gross profit and non-GAAP gross margin as U.S.
Year Ended December 31, 2023 2022 (in thousands) Revenue $ 276,284 $ 238,067 Cost of revenue (1) 71,923 70,442 Gross profit 204,361 167,625 Operating expenses: Research and development (1) 90,138 80,589 Sales and marketing (1) 153,714 129,962 General and administrative (1) 54,887 53,636 Restructuring and other related charges (1) 8,142 — Total operating expenses 306,881 264,187 Loss from operations (102,520 ) (96,562 ) Other income (expense), net 13,426 3,981 Loss before provision for (benefit from) income taxes (89,094 ) (92,581 ) Provision for (benefit from) income taxes 1,269 796 Net loss $ (90,363 ) $ (93,377 ) (1) Amounts include stock-based compensation expense as follows: Year Ended December 31, 2023 2022 (in thousands) Cost of revenue $ 7,300 $ 6,468 Research and development 36,643 27,855 Sales and marketing 29,404 17,143 General and administrative 14,085 15,757 Restructuring and other related charges 853 — Total stock-based compensation expense $ 88,285 $ 67,223 58 The following table sets forth the components of our consolidated statements of operations and comprehensive loss data, for each of the periods presented, as a percentage of revenue.
Year Ended December 31, 2024 2023 (in thousands) Revenue $ 299,272 $ 276,284 Cost of revenue (1) 76,924 71,923 Gross profit 222,348 204,361 Operating expenses: Research and development (1) 97,565 90,138 Sales and marketing (1) 168,306 153,714 General and administrative (1) 63,860 54,887 Restructuring and other related charges (1) — 8,142 Total operating expenses 329,731 306,881 Loss from operations (107,383 ) (102,520 ) Other income (expense), net 14,855 13,426 Loss before provision for (benefit from) income taxes (92,528 ) (89,094 ) Provision for (benefit from) income taxes 1,791 1,269 Net loss $ (94,319 ) $ (90,363 ) (1) Amounts include stock-based compensation expense as follows: Year Ended December 31, 2024 2023 (in thousands) Cost of revenue $ 6,472 $ 7,300 Research and development 44,421 36,643 Sales and marketing 32,119 29,404 General and administrative 17,007 14,085 Restructuring and other related charges — 853 Total stock-based compensation expense $ 100,019 $ 88,285 58 The following table sets forth the components of our consolidated statements of operations and comprehensive loss data, for each of the periods presented, as a percentage of revenue.
Other Income (Expense), net Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Other income (expense), net $ 13,426 $ 3,981 9,445 237% Other income (expense), net increased $9.4 million, in fiscal 2023 compared to fiscal 2022.
Other Income (Expense), net Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Other income (expense), net $ 14,855 $ 13,426 1,429 11% Other income (expense), net increased $1.4 million, or 11%, in fiscal 2024 compared to fiscal 2023.
Net cash used in investing activities of $89.4 million for fiscal 2022 consisted of $83.2 million of purchases of marketable securities, $2.2 million of capitalized internal-use software development costs, $3.6 million in purchases of property and equipment, and $0.4 million of cash paid for acquisitions, net of cash acquired.
Investing Activities Net cash used in investing activities of $75.4 million for fiscal 2024 consisted of $146.3 million of purchases of marketable securities, $16.1 million in cash paid for an acquisition, net of cash acquired, $5.1 million of capitalized internal-use software development costs, and $1.7 million in purchases of property and equipment.
As of December 31, 2023 2022 YoY Growth (dollar values in millions) Annual Recurring Revenue $ 281 $ 255 10% Dollar-Based Net Retention Rate (TTM) 101 % 119 % Paying Customers 2,723 1,994 37% Annual Recurring Revenue We define annual recurring revenue (“ARR”) as the annual recurring revenue of subscription agreements, including certain premium professional services that are subject to contractual subscription terms, at a point in time based on the terms of customers’ contracts.
As of December 31, 2024 2023 YoY Growth (dollar values in millions) Annual Recurring Revenue (ARR) $ 312 $ 281 11% Dollar-Based Net Retention Rate (TTM) 97 % 101 % Paying Customers with ARR of $100,000 or greater 591 511 16% 52 Annual Recurring Revenue We define annual recurring revenue (“ARR”) as the annual recurring revenue of subscription agreements at a point in time based on the terms of customers’ contracts, including certain premium services that are subject to contractual subscription terms and Plus customers that we expect to recur.
The increase was also attributable to an increase of $6.6 million in bonuses and commissions related to an increase in the amortization of capitalized commissions in the period compared to the same period in the prior year and amounts earned in the year.
The increase was also attributable to an increase of $2.5 million in commissions and variable compensation related to an increase in the amortization of capitalized commissions in the period compared to the same period in the prior year. There was also an increase of $1.3 million in travel-related expenses.
These changes were offset by an increase in deferred commissions of $8.0 million, a $2.4 million increase in accounts receivable due to higher customer billing, and a $3.6 million decrease in operating lease liabilities due to payments related to our operating lease obligations.
These changes were offset by an increase in prepaid expenses and other current and noncurrent assets of $5.5 million, a $4.9 million decrease in operating lease liabilities due to payments related to our operating lease obligations, and an increase in deferred commissions of $4.3 million.
Personnel and related expenses are the most significant component of operating expenses and consist of salaries, benefits, stock-based compensation expense, and, in the case of sales and marketing expenses, sales commissions. Operating expenses also include an allocation of overhead costs for facilities and shared IT-related expenses.
Operating Expenses Our operating expenses consist of research and development, sales and marketing, and general and administrative expenses. Personnel and related expenses are the most significant component of operating expenses and consist of salaries, benefits, bonuses, stock-based compensation expense, and, in the case of sales and marketing expenses, sales commissions.
The following Non-GAAP Financial Measures and related Non-GAAP reconciliations are for the year ended December 31, 2023, compared to the same period in 2022, unless otherwise stated.
A reconciliation is also provided below for each non-GAAP financial measure to the most directly comparable financial measure stated in accordance with U.S. GAAP. The following Non-GAAP Financial Measures and related Non-GAAP reconciliations are for the year ended December 31, 2024, compared to the same period in 2023, unless otherwise stated.
The increase in revenue was primarily due to growth of our paying customer base of 37% and revenue generated from our existing paying customers as reflected by our NRR (TTM) of 101% as of December 31, 2023.
The increase in revenue was primarily due to growth of our paying customer base, partially offset by partial and full churn among existing customers which marginally outpaced our expansion of existing customers as reflected by our NRR (TTM) of 97% as of December 31, 2024.
In addition, as a public company, we incur additional costs associated with accounting, compliance, insurance, and investor relations.
As a public company, we expect to continue to incur costs associated with accounting, compliance, insurance, and investor relations which could fluctuate from period to period.
The increase was primarily related to a $9.4 million increase in interest income due to rising interest rates and interest earned on investments in money market funds and marketable securities held during the year ended December 31, 2023 that were purchased in the second half of the year ended December 31, 2022. 60 Provision for (Benefit from) Income Taxes Year Ended December 31, 2023 2022 $ Change % Change (in thousands, except percentages) Provision for (benefit from) income taxes $ 1,269 $ 796 $ 473 59% Provision for (benefit from) income taxes increased $0.5 million, or 59%, in fiscal 2023 compared to fiscal 2022, primarily due to an increase in foreign taxes resulting from foreign deferred tax balance changes during the year December 31, 2023.
The increase was primarily due to higher interest income of $1.5 million due to a higher combined yield on investments and cash equivalents during the year ended December 31, 2024. 60 Provision for (Benefit from) Income Taxes Year Ended December 31, 2024 2023 $ Change % Change (in thousands, except percentages) Provision for (benefit from) income taxes $ 1,791 $ 1,269 $ 522 41% Provision for (benefit from) income taxes increased $0.5 million, or 41%, in fiscal 2024 compared to fiscal 2023, primarily due to an increase in foreign taxes during the year ended December 31, 2024.
Our relationship with some of the world’s most beloved product-led companies has resulted in increased brand credibility and access to many attractive growth opportunities. We have been successful at efficiently growing our customer spend over time as evidenced by our dollar-based net retention rates.
We believe our relationship with some of the world’s most beloved product-led companies has resulted in increased brand credibility and access to many attractive growth opportunities. As of December 31, 2024 and 2023, our dollar-based net retention rate (TTM) was 97% and 101%, respectively, for paying customers.
Additionally, we had 39 and 30 customers, respectively, that each represented greater than $1 million in ARR, up 30% year-over-year.
As of December 31, 2024 and 2023, we had 591 and 511 customers, respectively, that each represented greater than $100,000 in ARR, representing a 16% increase year-over-year. Additionally, we had 42 and 39 customers, respectively, that each represented greater than $1 million in ARR, up 8% year-over-year.
In the long term, we expect our gross profit to increase in dollar amount and our gross margin to improve as we optimize our system performance and leverage ingested data for new products. Operating Expenses Our operating expenses consist of research and development, sales and marketing, and general and administrative expenses.
In the long term, we expect our gross profit to increase in dollar amount and our gross margin to improve as we optimize our system performance and leverage ingested data for new products though the gross margin percentage may fluctuate from quarter to quarter due to potential reinvestments into the business. The extent and timing of such investments may vary.
Over the longer term, we believe these expenses as a percentage of revenue will decrease, though these expenses as a percentage of revenue could increase in the short term.
As we continue to invest in our platform, we expect our research and development expenses, including those capitalized for internal-use software, to increase in dollar amount over time. Over the longer term, we believe these expenses as a percentage of revenue will decrease, though these expenses as a percentage of revenue could increase in the short term.
As we seek to expand our business globally, we may be adversely affected by global economic and political instability.
For the years ended December 31, 2024 and 2023, 40% and 39% of our revenue was generated outside the United States, respectively. As we seek to expand our business globally, we may be adversely affected by global economic and political instability.
Restructuring and Other Related Charges Restructuring and other related charges were $8.1 million in fiscal 2023 related to charges related to employee transition, severance payments, employee benefits, and stock-based compensation. We did not have related expenses in fiscal 2022.
The increase was also attributable to an increase of $1.5 million in legal fees. Restructuring and Other Related Charges Restructuring and other related charges related to employee transition, severance payments, employee benefits, and stock-based compensation were $8.1 million during fiscal 2023, with no costs incurred in fiscal 2024.
Total 2024 2025-2026 2027-2028 After 2028 (in thousands) Operating lease and real estate-related commitments (1) $ 9,302 $ 5,464 $ 3,838 $ — $ — Purchase commitments (2) 176,994 68,526 108,468 — — Total contractual obligations $ 186,296 $ 73,990 $ 112,306 $ — $ — (1) Consists of future real estate-related non-cancellable minimum rental payments under operating leases and real estate commitments with substitution rights.
Total 2025 2026-2027 2028-2029 After 2029 (in thousands) Operating lease and real estate-related commitments (1) $ 6,364 $ 4,209 $ 2,108 $ 47 $ — Purchase commitments (2) 129,166 79,426 49,740 — — Total contractual obligations $ 135,530 $ 83,635 $ 51,848 $ 47 $ — (1) Consists of future real estate-related non-cancellable minimum rental payments under operating leases and real estate commitments with substitution rights.
Over the longer term, we believe these expenses as a percentage of revenue will decrease over the longer term, though these expenses as a percentage of revenue could increase in the short term.
Over the longer term, we believe these expenses as a percentage of revenue will decrease, though these expenses as a percentage of revenue could increase in the short term. Finally, we see opportunities to expand offices and headcount internationally to better service targeted international markets where we believe we have significant opportunity to accelerate existing traction and success.
The net cash provided by changes in operating assets and liabilities primarily consisted of a $20.7 million increase in deferred revenue, resulting from increased billings and collections for subscriptions, a net increase in accrued expenses and accounts payable of $1.7 million due to timing of payments made, and a net decrease in prepaid expenses and other current and noncurrent assets of $4.0 million.
The net cash provided by changes in operating assets and liabilities primarily consisted of collections outpacing revenue recognized as evidenced through the increase in cash of $8.6 million from changes in accounts receivable and deferred revenue and a net increase in accrued expenses and accounts payable of $8.5 million.
Net cash provided by financing activities of $5.8 million for fiscal 2022 primarily consisted of $6.9 million in proceeds from the exercise of stock options offset by $1.1 million of net cash used from sales of common stock to cover tax-related amounts that were remitted to the respective taxing jurisdictions in excess of cash received during the period.
Financing Activities Net cash used in financing activities of $19.9 million for fiscal 2024 primarily consisted of $26.4 million in net tax remittance on equity awards related to the vesting of RSU awards under a withhold-to-cover method, partially offset by $6.5 million in proceeds from the exercise of stock options.
We have invested, and expect to continue to invest, in our sales and marketing efforts to drive customer acquisition. As of December 31, 2023 and 2022, we had 2,723 and 1,994 paying customers, respectively, representing an increase of 37% year-over-year.
We have invested, and expect to continue to invest, in our sales and marketing efforts to drive customer acquisition.
The number of customers representing greater than $100,000 and $1 million in ARR demonstrates the strategic importance of our platform and our ability to both initially land significant accounts and grow them over time. 51 Investments in Platform We believe that our customers will demand additional features and capabilities beyond our current platform offerings to assist them in optimizing their digital products.
Additionally, our ending dollar-based net retention rate for paying customers as of December 31, 2024 and 2023, was 100% and 98%, respectively. 51 Investments in Platform We believe that our customers will demand additional features and capabilities beyond our current platform offerings to assist them in optimizing their digital products.
We make exceptions for holding companies, government entities, and other organizations for which the GULT, in our judgment, does not accurately represent the Amplitude customer or the DUNS does not exist. Restructuring Plan In April 2023, we authorized a restructuring plan (the “Restructuring Plan”) to reduce our global workforce by approximately 13% to improve operational efficiencies and reduce operating costs.
We make exceptions for holding companies, government entities, and other organizations for which the GULT, in our judgment, does not accurately represent the Amplitude customer or the DUNS does not exist. We define Paying Customers with ARR of $100,000 or greater as those Paying Customers on one or more paid subscriptions that have $100,000 or more in ARR.
The increase was primarily due to an increase of $9.0 million in stock-based compensation expense and related payroll taxes and an increase of $0.7 million in software subscription costs. Sales and Marketing Sales and marketing expenses increased $23.8 million, or 18%, in fiscal 2023 compared to fiscal 2022.
The increase was primarily due to an increase of $11.2 million in stock-based compensation expense and related payroll taxes mainly attributed to a one-time charge of $13.0 million related to our acquisition of CommandAI, and an increase of $2.6 million in personnel and related expenses, including an increase in allocated overhead costs.
We continue to increase the number of customers who have entered and grown into larger subscriptions with us. As of December 31, 2023 and 2022, we had 511 and 480 customers, respectively, that each represented greater than $100,000 in ARR, representing a 6% increase year-over-year.
Historically, we have been successful at efficiently growing our customer base and number of customers who have entered into and grown into larger subscriptions with us as evidenced by the growth of our number of paying customers and number of customers that represent greater than $100,000 in annual recurring revenue (“ARR”).
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As of December 31, 2023 and 2022, our dollar-based net retention rate (TTM) was 101% and 119%, respectively, for paying customers. Additionally, our ending dollar-based net retention rate for paying customers as of December 31, 2023 and 2022, was 98% and 110%, respectively.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2023, we had cash and cash equivalents of $248.5 million and marketable securities, including non-current investments, of $73.9 million. We do not enter into investments for trading or speculative purposes. Our investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income on cash and cash equivalents.
Biggest changeAs of December 31, 2024, we had cash and cash equivalents of $171.7 million and marketable securities, including non-current investments, of $126.7 million. We do not enter into investments for trading or speculative purposes. Our investments are exposed to market risk due to fluctuations in interest rates, which may affect our interest income on cash and cash equivalents.

Other AMPL 10-K year-over-year comparisons