Zeta Global Holdings Corp. (ZETA) is a leading marketing technology company that leverages proprietary data, artificial intelligence, and software to create a powerful platform that enables enterprises to acquire, retain, and grow customer relationships. The company's Zeta Marketing Platform (ZMP) is a data-driven, AI-powered solution that helps marketers deliver personalized experiences across all digital channels, including email, social media, web, chat, Connected TV (CTV), and video.

Financials

In the fiscal year 2023, Zeta reported annual revenue of $728,723,000 and a net loss of $187,481,000. The company's annual operating cash flow was $90,523,000, and its annual free cash flow was $54,553,000. These financial results demonstrate Zeta's ability to generate significant revenue and cash flow, despite ongoing investments in product development and market expansion.

For the first quarter of 2024, Zeta reported revenue of $194,947,000, up 24% year-over-year. The company's adjusted EBITDA for the quarter was $30,505,000, representing a margin of 15.6% and a 27% year-over-year increase. Zeta's strong performance in the first quarter has led the company to raise its full-year 2024 revenue guidance to $900 million at the midpoint, representing 24% year-over-year growth.

Business Overview

Zeta's success is driven by several key factors, including the growing need for enterprises to leverage data and AI to deliver more personalized and effective marketing campaigns. The company's ZMP platform integrates its proprietary data cloud with customers' first-party data to uncover consumer insights and unlock better customer experiences and improved return on investment.

Growth Drivers

One of Zeta's key growth drivers is the marketing cloud replacement cycle, as enterprises seek to replace legacy marketing platforms with more modern, data-driven solutions. The company is also benefiting from the rebound of the automotive and insurance sectors, as well as the ramp-up of its agency business, which provides an additional source of high-quality demand generation.

Innovation

Zeta's focus on innovation has also been a critical component of its success. In the first quarter of 2024, the company launched its Generative Intelligent Agent Composer store, which allows customers to easily build and share virtual agents within the platform to automate various marketing tasks. This capability is helping Zeta's customers become more efficient and effective in their marketing efforts.

Geographic Presence

The company's geographic footprint is primarily focused on the United States, which accounted for 96.5% of its revenue in the first quarter of 2024. Zeta also has a presence in international markets, including the United Kingdom, France, Belgium, and India, which contributed the remaining 3.5% of revenue.

Revenue Breakdown

In terms of revenue breakdown, Zeta generates the majority of its revenue from direct platform revenue (67% in Q1 2024), which includes subscription fees and volume-based utilization fees. The remaining 33% of revenue comes from integrated platform revenue, which leverages API integrations with third-party platforms.

Liquidity

Zeta's strong financial position and liquidity provide the company with the resources to continue investing in product development, sales and marketing, and strategic acquisitions. As of March 31, 2024, the company had $141,649,000 in cash and cash equivalents and $184,249,000 in long-term borrowings.

The company's balance sheet and cash flow generation also support its ability to navigate potential macroeconomic headwinds. Zeta's current ratio, a measure of short-term liquidity, stood at 1.89 as of March 31, 2024, indicating a strong ability to meet its short-term obligations.

Outlook

Looking ahead, Zeta's management team remains confident in the company's growth prospects, driven by the continued adoption of its ZMP platform, the expansion of its agency partnerships, and the ongoing demand for data-driven, AI-powered marketing solutions. The company's focus on innovation and its ability to deliver measurable results for its customers position Zeta as a leader in the rapidly evolving marketing technology landscape.