What Happened?

Shares of digital analytics platform Amplitude (NASDAQ: AMPL) jumped 12.5% in the afternoon session after the company launched a new series of artificial intelligence (AI) agents designed to continuously analyze product usage. 

These AI agents were created to monitor how a product is used, identify what works and what doesn't, and then recommend actions in real-time. According to Amplitude's co-founder and CEO, Spenser Skates, this development signaled a "new era of analytics" that allowed teams to focus on improving customer experiences. The product launch occurred just before the company was expected to report its fourth-quarter earnings. Ahead of that report, analysts had projected revenue to grow by more than 15% compared to the same period in the previous year.

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What Is The Market Telling Us

Amplitude’s shares are extremely volatile and have had 32 moves greater than 5% over the last year. But moves this big are rare even for Amplitude and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 6 days ago when the stock dropped 7.8% on the news that investors continued to distinguish between the winners and losers in the artificial intelligence boom, leading to a broad sell-off. The Nasdaq fell 1.5%, while the S&P 500 and Dow Jones Industrial Average also saw significant declines. This market shift indicated that investors were becoming more selective, moving beyond the initial excitement surrounding AI. In addition, a stronger-than-expected U.S. jobs report dampened investor expectations for near-term interest rate cuts from the Federal Reserve. Data showed the U.S. labor market remained resilient, with non-farm payrolls indicating impressive job creation and falling unemployment. This positive economic signal led markets to re-evaluate the timeline for monetary policy easing, which is the process by which a central bank reduces interest rates to stimulate economic growth. Investors priced in the first potential rate cut for July, a shift from previous expectations of June. This delay created a headwind for growth-oriented sectors like software, as higher interest rates can reduce the present value of future earnings.

Amplitude is down 34.3% since the beginning of the year, and at $7.19 per share, it is trading 50.2% below its 52-week high of $14.44 from February 2025. Investors who bought $1,000 worth of Amplitude’s shares at the IPO in September 2021 would now be looking at an investment worth $131.11.

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