Zeta Global Q2 Earnings Call Centers on AI Adoption & Raised '26 View

ZETA Raises Outlook With Core Strength

Chief financial officer Christopher Greiner said the full-year revenue midpoint increased by $33 million to $1.818 billion, representing 39% growth, or 25% excluding M&A and political candidate revenues.

The company lifted the adjusted EBITDA midpoint to $405 million and the free cash flow midpoint to $255 million. Full-year GAAP earnings guidance moved to 9-11 cents per share from 2-4 cents.

For the third quarter, management expects revenues of $469-$472 million and adjusted EBITDA of $115-$116 million. Greiner said the outlook retains a 2-5% cushion and includes little from unsigned partnership opportunities.

Zeta Global Ties AI Adoption to Revenue Quality

More than 40% of super-scaled customers became monthly active Athena users within 130 days of launch. The 20% of all customers with comprehensive AI adoption generated about 70% of revenues.

Among super-scaled customers, the 50% with comprehensive AI adoption accounted for 75% of revenues. Greiner added that these users grew four times faster than customers earlier in adoption.

Net revenue retention among the most advanced AI adopters ran 400 basis points above Zeta Global overall and more than 20 percentage points above customers still ramping. Super-scaled customer relationships averaged 56 months, up from 48 months previously.

ZETA Pushes Beyond Marketing

Co-founder, chairman and CEO David Steinberg framed Zeta Global as an intelligent AI infrastructure platform rather than only a marketing technology provider. He positioned Zeta Business Intelligence or ZBI, as a fourth use case alongside acquire, grow and retain.

Steinberg said ZBI supports real-time decisions rather than static reporting. Customer applications include evaluating streaming relationships and measuring the value a consumer brand creates for retail partners.

In response to a Canaccord Genuity analyst, Steinberg said customer requests are being productized by vertical. He linked that speed to automation, with 89.6% of new code generated automatically in the quarter.

ZETA Partnerships Expand the Sales Funnel

Steinberg highlighted OpenAI, Snowflake and Palantir as external catalysts. OpenAI powers Athena's voice layer, while Zeta Global's inference models handle decisioning without exposing Data Cloud information to large language models.

Palantir integration finished July 31, and Steinberg said two initial joint opportunities had converted into agreements. He said additional prospects were not included in formal guidance.

A Citi analyst asked about direct OpenAI monetization. Steinberg said Zeta Global is already serving ads through the relationship, called it meaningful and said little OpenAI or Palantir contribution is embedded in the outlook.

ZETA Q&A Highlights Pipeline and Productivity

Greiner said the sales pipeline rose more than 60% year over year and more than $100 million in 90 days. Pipeline creation per seller more than doubled, while quota-carrying headcount increased by one sequentially to 198.

A Truist Securities analyst asked about marketing cloud replacement activity. Steinberg said RFP velocity and closing activity were rising, citing Gap's selection of Zeta Global as its system of record after displacing several vendors.

A Needham analyst questioned recent ARPU variability. Greiner said newer customers crossing the super-scaled threshold enter at lower revenue levels, while customers on the platform for four years or more approach $4 million in ARPU.

Zeta Global Keeps Execution and Cash in Focus

The company reported adjusted EBITDA of $92 million, a 20.7% margin, and free cash flow of $58 million. Steinberg credited Marigold integration savings and improved expense ratios across research, administration and selling functions.

Steinberg's closing emphasis remained on execution, AI-enabled productivity and disciplined capital use. Management kept share repurchases and small-to-midsized acquisitions among its priorities.

What ZETA's Rank & Scores Signal

ZETA currently carries a Zacks Rank #4 (Sell). Its Growth Score of A and VGM Score of B indicate favorable growth characteristics and a solid combined style profile, while the Value Score of D and Momentum Score of C are less supportive.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Under the Zacks framework, Style Scores complement rather than override the rank, which reflects earnings-estimate revision trends over the next one to three months. The Zacks Rank can change as analysts revise estimates following the newly reported results.

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