Summary: Piper Sandler lowered its price objective for Amplitude Inc. to $10 from $12, keeping an Overweight recommendation. The revised target implies about a 39% upside from the prevailing share price of $7.18. The firm flagged continued execution in upmarket sales, faster product development cadence and momentum among AI-native customers, even as it pointed to industry-wide multiple compression as the reason for trimming the target.
Quarterly performance and revenue outlook
Piper Sandler noted that Amplitude's fourth-quarter revenue finished 2% above the midpoint of the company's guidance. The bank models fiscal 2026 revenue growth at 15% year-over-year, above consensus at 14% and implying an acceleration versus recent trends. That projection builds on Amplitude's reported 12.8% revenue growth over the last twelve months, and sits alongside analyst expectations for roughly 14% revenue growth in fiscal 2025.
The company also recorded its sixth consecutive quarter of accelerating annual recurring revenue (ARR) growth, a metric Piper Sandler highlighted as evidence of durable commercial progress.
Customers, contracts and product momentum
Piper Sandler emphasized momentum in larger customer accounts, noting that more than 25 customers now sit in the cohort generating $100,000 or more in annual recurring revenue. The firm also referenced a recently signed seven-figure contract with a frontier AI lab as an example of traction among AI-native buyers. Analysts and the firm cited increased product velocity as another constructive sign.
Profitability and margins
On profitability, Amplitude's fourth-quarter operating margin came in at 4.6%, slightly below the guidance midpoint of 5%. The company has not been profitable over the last twelve months, but analyst consensus projects a return to profitability in the coming fiscal year with an EPS forecast of $0.07.
Valuation context and balance sheet
Piper Sandler attributed its reduction in the price target primarily to the broader de-rating observed across the software sector rather than company-specific deterioration. The firm noted Amplitude's balance sheet position, pointing out the company holds more cash than debt. Market performance has been volatile: while the stock delivered a 15.6% return over the most recent week cited by the firm, it remains materially lower over longer horizons, down roughly 35.6% over the past six months and about 38% year-to-date, with shares trading near what is characterized as fair value.
Other analyst actions and strategic moves
Recent corporate and sell-side developments were also highlighted. Amplitude acquired InfiniGrow, an AI marketing analytics firm, a move presented as intended to strengthen the company's marketing analytics capabilities and make analytics more actionable for marketing teams. On the analyst front, Morgan Stanley upgraded Amplitude to Overweight and set a $16.00 price target, citing potential upside from expanded digital-product user behavior data linked to generative AI. KeyBanc lowered its target to $14 from $16 but kept an Overweight rating, while BTIG initiated coverage with a Buy rating and a $14.00 price target, recognizing leadership in product analytics and broader platform offerings.
Takeaway
Piper Sandler's target cut reflects investor sensitivity to sector-wide multiple compression despite operational signs of progress at Amplitude, including expanding large-account penetration, accelerating ARR growth, product momentum and a cash-positive balance sheet. The company continues to attract attention from other research teams and to pursue strategic acquisitions aimed at enhancing analytics capabilities.
Key points
- Piper Sandler lowered its Amplitude price target to $10 from $12 but maintained an Overweight rating; the target implies about 39% upside from a $7.18 share price.
- Amplitude posted Q4 revenue 2% above the midpoint of guidance and projects fiscal 2026 revenue growth of 15%, outpacing a 14% consensus estimate and signaling acceleration.
- Company momentum includes accelerated ARR growth for six consecutive quarters, more than 25 customers with $100,000-plus ARR, a seven-figure contract with a frontier AI lab, and the acquisition of InfiniGrow to bolster marketing analytics.
Risks and uncertainties
- Sector de-rating: Piper Sandler explicitly cites a broad de-rating across the software sector as the driver of the price target reduction, indicating market multiples remain a risk for valuation - this primarily affects software and cloud analytics companies.
- Profitability and margin pressure: Amplitude was not profitable over the last twelve months and reported an operating margin (4.6%) below the guidance midpoint, creating uncertainty around near-term earnings improvement - relevant to investors focused on software profitability metrics.
- Share-price volatility: The stock has experienced substantial declines over six months and year-to-date despite a recent one-week rebound, underscoring market volatility risk for equity investors in the software sector.
These points reflect the facts and analyst commentary provided without extrapolation beyond the reported items.