ZoomInfo (ZI), a leading sales intelligence platform, exceeded Wall Street’s revenue expectations in Q4 CY2024, posting $309.1 million in revenue—a 3.8% beat against analyst estimates.
However, sales fell 2.3% year over year, reflecting ongoing demand challenges. Adjusted earnings per share (EPS) came in at $0.26, beating consensus estimates by 14.8%.
Despite the revenue decline, management provided a positive outlook, guiding for Q1 CY2025 revenue of $295.5 million at the midpoint, surpassing analyst expectations by 1.2%. CEO Henry Schuck emphasized the company’s commitment to delivering value through its Go-To-Market Intelligence Platform, which integrates AI-driven insights for enterprise sales teams.
Growth Amidst Market Headwinds
ZoomInfo’s enterprise customer base remains a key driver of growth, with 1,867 customers paying over $100,000 annually—a net gain of 58 from the previous quarter. The company has also aggressively expanded its AI-powered Copilot product, securing over $150 million in Annual Contract Value (ACV). Meanwhile, the Operations segment posted a robust 27% year-over-year increase in Q4, underscoring the firm’s efforts to strengthen its upmarket offerings.
However, the downmarket segment continues to struggle, declining by 9% in 2024. Management expects this weakness to persist into 2025, prompting a strategic pivot toward larger enterprise accounts. Net revenue retention improved to 87%, indicating stabilization, but still leaves room for further growth.
ZoomInfo’s enterprise customer base remains a key driver of growth, with 1,867 customers paying over $100,000 annually—a net gain of 58 from the previous quarter. The company has also aggressively expanded its AI-powered Copilot product, securing over $150 million in Annual Contract Value (ACV). Meanwhile, the Operations segment posted a robust 27% year-over-year increase in Q4, underscoring the firm’s efforts to strengthen its upmarket offerings.
However, the downmarket segment continues to struggle, declining by 9% in 2024. Management expects this weakness to persist into 2025, prompting a strategic pivot toward larger enterprise accounts. Net revenue retention improved to 87%, indicating stabilization, but still leaves room for further growth.
Share Repurchases Signal Confidence
ZoomInfo’s leadership remains bullish on the company’s long-term prospects, evidenced by an aggressive share buyback strategy. In 2024, the company repurchased 46.8 million shares at an average price of $12, representing 12% of outstanding shares. An additional $500 million repurchase authorization signals continued confidence from management.
Despite a 44% decline in its stock price over the past year, the Q4 earnings beat sent shares soaring 22% to $11.65. CEO Henry Schuck reiterated his belief that the stock remains undervalued, reinforcing the company's commitment to returning value to shareholders.
ZoomInfo’s leadership remains bullish on the company’s long-term prospects, evidenced by an aggressive share buyback strategy. In 2024, the company repurchased 46.8 million shares at an average price of $12, representing 12% of outstanding shares. An additional $500 million repurchase authorization signals continued confidence from management.
Despite a 44% decline in its stock price over the past year, the Q4 earnings beat sent shares soaring 22% to $11.65. CEO Henry Schuck reiterated his belief that the stock remains undervalued, reinforcing the company's commitment to returning value to shareholders.
Outlook: Opportunities and Risks
Looking ahead, ZoomInfo projects full-year 2025 revenue of $1.20 billion, a modest 1.6% decline, but a slight improvement over 2024’s -2% growth rate. Adjusted EPS guidance of $0.96 at the midpoint exceeds analyst expectations by 4.4%. However, declining operating and free cash flow margins, coupled with persistent downmarket weakness, present risks to sustained growth.
While the company’s AI investments and enterprise expansion provide upside potential, macroeconomic uncertainties and competitive pressures warrant a cautious approach. Investors should weigh ZoomInfo’s improving fundamentals against lingering headwinds before making any decisions.
Looking ahead, ZoomInfo projects full-year 2025 revenue of $1.20 billion, a modest 1.6% decline, but a slight improvement over 2024’s -2% growth rate. Adjusted EPS guidance of $0.96 at the midpoint exceeds analyst expectations by 4.4%. However, declining operating and free cash flow margins, coupled with persistent downmarket weakness, present risks to sustained growth.
While the company’s AI investments and enterprise expansion provide upside potential, macroeconomic uncertainties and competitive pressures warrant a cautious approach. Investors should weigh ZoomInfo’s improving fundamentals against lingering headwinds before making any decisions.
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