ZI - Earnings call transcript Q4 2024 | ZoomInfo Technologies Inc.

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Operator

Good day, and thank you for standing by. Welcome to the ZoomInfo Fourth Quarter and Full Year 2024 Financial Results Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your first speaker today, Jerry Sisitsky, Vice President of Investor Relations. Please go ahead.

Jeremiah Sisitsky

Lauren. [ Thanks, ZoomInfo's quarter to conference for call ] full financial year fourth and XXXX. the Welcome results

With me Interim on and the call today are ZoomInfo; Graham CEO Henry and O'Brien, our CFO. of Schuck, Founder

believe forward-looking statements to of the including business expressions, without similar historical provisions laws. and outlook, During this for securities anticipate may, call, are pursuant will, financial safe are U.S. goals, to future facts of something using identify items, future reflect limitation, terminology other statements. made expect, Expressions expectations forward-looking expressions harbor the including and which and any performance than intended

any Forward-looking in statements. no undertakes to number the arise of SEC reflect The a revise statements sections obligation any conference forward-looking may by that or Factors to and after from law. of except order our involve this may uncertainties, statements call, forward-looking discussed Risk required events results in filings. company including those Actual update risks materially as differ

to the call For this posted found financial our at release on more metrics can information, please A otherwise ir.zoominfo.com. website. All reconciliation to in Relations results the forward-looking our noted. the Investor to or be and non-GAAP, website slides unless slides are posted in the statements IR press refer

With that, Henry. to I'll turn the call over

Henry Schuck

Thank you, and welcome, Jerry, everyone.

set than financial stabilized operating faster before. making we company progress, which the ever took growth all key across success. achieved is QX, the In metrics, anticipated. And drove are we steps better-than-expected in of In up business. than and growth had and QX, meaningful in we today QX, resulted our results we to Info number better Zoom I believe for positioned we a long-term of

we quarter in product XX%, changes for above adjusted X past the that of end As enacted the the other years. million of $XXX results was high culmination QX and was result, to and a guidance. both sales, million, over a represent margin the of revenue $XXX GAAP operations income The operating fourth

over With up CoPilot and key to our our AI teams. are caught their customers. best up initiatives. customers their the of customers by our $XXX data innovation, throughout internal And again with more expectations foundation million engaged in our are agents our data Copilot XX% and winning X exceeded their the year-over-year. and are now in record, Operations accelerating has leveraging execution ZoomInfo ACV. leading and fastest-growing power the systems data, and and platform, is go-to-market winning enriches in was area growth and with business, QX of AI Our applications to go-to-market ways. strengthens systems warehouses operations, They that happier data driving and winning

opportunity of consistently where framework solutions, facto this continued enterprise. data operation greater With the upmarket X is of success large will resourcing of and ways: and downmarket. to are mid-market think We becoming we employees. companies well way be business provider and we XXX our the our with our includes are against in the growing on and enterprise to the we about momentum de forward. moving the Up talk businesses, our using AI and of and data market in the than that And market

develop more For reps platform. our functionality to base, more features customer continue upmarket add and the we and sets for data

customer the primarily down path on of growing doubled down margins XXXX their X/X than a motion due Upmarket is and the our than and expanded trial success. also lifetime flexibility, significantly business, account grew customer on delight in services difference have digits drive and to has value. to mid-single is rebalanced X% higher We loads and to our market, in more

we and onboarding are the than in expect portion signs We our as X% defined upfront and less businesses fewer comprises business, market customers of X/X risky show this of market down business, business. efficiently more digital-first declined well. healthier XXX with improvement drive Down smaller XXXX profitability of and than disqualifying approach. stabilizing as a cohort, small our through shift continued We prepayment employees. upmarket to a requiring to In

to expect while upmarket strong report I growth more of business this and We to it rates. relative sharing upmarket, size going on than But X/X split growing. and our downmarket and important that think is forward, is reiterate

guidance while continue while we contribution Our market is we and than of the will minimize more We be of we as of customers now it to so off. X,XXX see a market. ACV, impact of increase a customers continue be customers, opportunities in will transition. the retention. have customers. we're $X managing net year-over-year increase upside this sequential the going upmarket upmarket already our to can and our off, we And investments with of the our are lower its to lower of the $XXX,XXX contribution paying to seeing upmarket We end it drive to decrease percentage in a XXX,XXX XX million-plus of customers that potential smaller, will and revenue healthier, paying discount in XX the aggressively see The investments And end growth and business. our it

number in QX growth to sequential our increase first fourth year-over-year revenue net XX% the We in NRR million XXXX. both the in drove of And customers the quarter, ACV $X the also of sequential cohort. in increased retention and and since

aligned been this our us go-to-market Improving a our us focus key with of needs and for customers' staying has year. customers' perception

The that months, that with improved conducted of majority the stayed ZoomInfo the a the saying same we perception has respondents improved. sales of last it X those found As recently of their part said of or of XXX in than survey brand XX% more leaders. and effort, marketing survey

productivity, support to retention CoStar, Copilot their Builder, within reps growth. customer to combat Getty sellers and Images, Technologies, During being to upsell. the drive global partnered equip the transactions the to of company their telecommunications and partnered Copilot is revenue marketing Labs, Athena deployed delivering We Highgate with to go & Copilot. AICPA. glove plans improve digital with quarter, we with Cox closed team also Struggles, Media, Hotels a Heidrick Career competitive X,XXX market. company and to leads to sales and Health, Lumen sales ZoomInfo they pressures leverage way marketing completely prioritize to within The company them services with transform We directly our white the drive leading arm and

marketing we more Copilot, and and we ZoomInfo and solution As and as acquisition and to for intelligence logo new complete and expand they transition are upmarket, growth a upsell marketing product-led account-based recording helping driving them providing with sales-led them from From using enriching growth platform. our go-to-market data cross-sell call move to they transcription are strategies execute upmarket.

at our Copilot motion search one than released used newly proof also tenfold. of for XXX-seat the engines, grow a job largest We more of trial concept to

pipeline successful build conversion reps. Our allowed trial to drive for more deliver us their more and that connects, better prove we could

pinpoint of productivity AI logos, market leaders fall behind. and clear services. they clients, leverage client for products in of go-to-market want drivers of it data products thousands in quarter's with has key who X start We years rates. grow areas. the rep sellers to prospects our expand not To roles. ago on to for of their world. intent They have Expanding our new when for customer website they're enhanced are level embarked by data specific their of XX% our is solution get platform One quality action dramatically introducing buyers X created BXB led product the so From with precisely a this we customers AI level improve started beyond accelerated to leaders organization when account we high-intent highest persona customers, journey key and pace we within success our to that identification, looking do to calls indicators that in on and allowing meeting base hundreds listening across and all In the in our QX, innovation. up-level to data lift a deliver of new that with success that front person-level

thousands of upmarket into quarter, Those would users. of of deals allowed activate accelerated on ZoomInfo. opportunities their in data we deals of our pipeline interface Copilot X/X have active for and proprietary out the X/X customers. directly In generated to without than customers the Our innovation workflows tens signals missed us the for more of this

We seller's workflow. automatically by a parts pace expanding account synthesizing expand innovation risks By plans of signals deal surface. ways identify to automate that AI continued our buyer groups. agents our of These our core Copilot agents relevant and that interactions, the AI always live agents up-to-date buying moment they recommend capture dynamic create

use motions. sales the to cases also adapt world, managers, AI some a prospecting We're on cases. and runs this beyond success framework, highly expansion ensuring top-of-the-funnel acceleration. among and account user than go-to-market than are more now within of deployed All traction account development can Xx our largest governance larger adopting deal teams customer account representatives already base capabilities and executives, key expanding these Copilot other of and sales organizations complex executives SDR. managers Account management in specialized automated the for customization planning, gaining account and and they use enterprise-grade account We're

of with automate platform. AEs increasing go-to-market fit base. of levels I'm onto ZoomInfo mission-critical seen SDR and cohorts at core we'll an the continue the comparable Copilot to We move our product to first and strong have confident AMs activating market user share utilization workflows

strong sales also of someone Dosdon, he accelerate and Ali nearly engineering internal is former I X and an Engineering, company. all Philip's take table Technology Rooney was that been and Board McCarter. at Giulio as will Popovic. to recent operations, directorship finance, also us the we to his transitioning knowledge, ZoomInfo strategy decades wish excited counterparts a is the the CFO about corporate I'm named to the our played Katie of best decade. is well. role that are the Ali has excited to strategic I Officer, endeavors. She moment here, our engagement pace recently nearly has moving decision of Katie customers for Through role infrastructure expanded to and platform currently and His leadership wish on want the serve services Officer flywheel deeply and roles as thank in of and was a he Philip Chief Senior Customer enterprise will him experience at throughout organization, of after DocuSign. revenue in is at Board. experience virtual Maven, previously years over Officer missed innovation the Rob and Rob the to development. in HubSpot, helping Directors. about I additions for our and leadership build him oversaw be senior at every HubSpot best and continue At and from years would also Officer world's our next women Adobe. thank in processes and XX We're and our is operations health Marketing we sales, and who respect Patrick also who spent at at confident VP and of team. marketing, and Chief Canva like Chief to largest families. board a the Chief Patrick partnership important Customer Rob partner marketing

incredibly with the boardroom successful are the fresh We and we history operating perspective of long to excited these experience, additions. about add

on we mode. have now a our is of always data financial And tailwind and history closing, ever, operational top our had than innovation more In disciplined engine execution. a creating of

free and the taken go-to-market expanding share a cash path growth while innovative that performance and improved drive We to company on industry-leading set customer future have flow of with solutions per delight. drive the driving the defining to operating necessary profitability, steps

for large the untapped are in innovation customers. to strong data upmarket go-to-market data we and opportunity a be a have and addressable winning the partner AI market, We mode

call to turn I'll over the that, With Graham.

Michael O'Brien

Henry. Thanks,

adjusted a QX, of in revenue In million, margin delivered of $XXX we million $XXX XX%. and operating income

sequential upmarket we resulting improving X.X%. risk and results QX deliver of deployed model in in better-than-expected in Our meaningfully yielding performance, is investments working The collection moving business write-off are growth resulting intended as as revenue trends.

more success we've take net again. improvement operational year to up AI, the to X-point operations for With and on retention, quality foundation in revenue onboard of we delivering focus business are and resulted market the need which demand customers, place advantage in sequential strong new more companies our continue XX%. increase saw realizing a able in better at model move customer With and ending we improvements they more implemented, a the data our additional risk value, and

points X a quarter. business in quarter, our higher As year-over-year, the operations XX% result, fourth last than increased

functionality Taken our together than up advanced with Copilot, XX since increased the of year. of XX% the to success overall more points the start driving business,

ACV similar see new in QX Copilot historically. majority million The continue As $XXX recently user-by-user than franchise coming expect seat migrations released to and in with our to to the from of that today, and in we we a levels on of more allows basis XXXX Copilot customers uplift existing though trial Copilot basis, per ACV is volume is as have or a of the we course drive of functionality larger team-by-team XXXX. over on customers a to

Turning repurchases. share to

For repurchase full shares $XX, XX.X retired cash authorization more price, to continue And approved $XXX balanced hand. top XXXX. we were entering average in to shares meaningful outstanding. remaining the there total million cash at representing on as an and take of the year, cost of shares generation repurchases a $XXX additional with XX% and shareholder We of on we authorizations million opportunistically advantage of the as share of at outstanding. In dislocations QX, will an way existing million look our share in board drive value than XXX million year-end,

Operating cash was cash in XX%. margin and flow for QX the $XXX flow of million, $XX was million a free unlevered quarter

$X.XX also XX%, per driving that significantly XXXX million, share. of interest XXX by was cash margin XXXX and grow per in the debt. million cash We delivered in outstanding, million. based To flow that $X and value expect million term. ended remain for carried equivalents, year cash flow we cash on unlevered with share cash free was committed $XX long $XXX growing We free over to for the end, gross weighted shares year levered full to free billion a flow than cash average more levered meaningfully and We shareholder in the $XXX and for diluted we

trailing agreements. performance in to EBITDA, obligations, remaining which future $X.XX year months expected be and defined net X.Xx, X.Xx, obligations, Our XX respect performance XX XX leverage trailing unearned to credit revenue is the $XXX which With adjusted our and ratio is the cash of consolidated RPO, or EBITDA and was of delivered end months at are next as were EBITDA, liabilities months. million billion, million $XXX the in

considered year-over-year into Before day other should tax has benefit I and AOI QX additional days QX growth Also, guidance, resets. XXXX which in margins QX XXXX by and be jump when X XXXX, are than context. let margins. fewer share and comparing me and some revenue QX fewer impacted X payroll sequential

we the a improvements to that and not good in XXXX in period. Additionally, XXXX, our for we and AOI to margins accounting seasonality income QX XXXX to increase change adjusted XXXX is we sequentially due weighted seasonally In as same estimates expirations. operational we proxy more to XXXX the the operating customers, and introduced upmarket mix in expect of expect XXXX move year. a lower market through QX was have

momentum to to We faster our are a guidance However, are growth and expected, than durable contributions are we back about path we optimistic our downmarket on into discounting XXXX. heading

for guidance me that, QX. to turn let With

We range million. GAAP million expect $XXX in revenue to of the $XXX

to net income the million, million range $XX operating share. of as $XX adjusted $X.XX of $X.XX in to range the per in expect We income non-GAAP

year guidance. revenue to midpoint negative the billion, expect at GAAP in guidance we million of the the income midpoint annual XX% in $XXX and the at $X.XXX representing full range representing of operating margin $X.XXX of billion adjusted XXXX, of the range to deliver X.X% $XXX For a to million, growth

X% the on And expect flow to the range of in $XXX based approximately non-GAAP range average revenue we We share expect be for year, unlevered to XXX the of And per the tax $X.XX modeling purposes, million in $XXX for of and expect the XX%. to net non-GAAP would CapEx rate million. of in diluted $X.XX income shares range outstanding. we cash weighted million free

over to turn it for open questions. will the operator the call I to Now

Operator

comes Our of with first Instructions] Wolfe Zukin [Operator line the question Research. Alex from

Aleksandr Zukin

a first on Congrats for I one Henry, solid you. quarter. guess just, maybe

just the And year? SMB of Just for also both perspective, you're hiring? we a the sense differently about enterprise sales financial the the we a guide maybe from embedded for segments coming think as in and the X growth should pipelines for year trends the exit the seeing, tech kind in of maybe how the rates and that

Henry Schuck

take part. Graham let second I'll the

that That smaller down but we and healthier contribution of I a group go operations becoming think part sell to portion is market. in in seeing into the the the our guidance and saw and the in group upmarket. we particularly our in stabilization is, SMB, our as business. and forward. And discounting strength products In growth the SMB, we're upmarket, the Copilot its customers we of going first our are

We expect -- within our I'll be of where Graham product operations will fit it demand, the over great And Copilot that to in execution for part the upmarket, we pass seeing our can in business. market that. we're be that where good it and upside, second

Michael O'Brien

growth the were the are Sure. in we growth. And think trajectories XXXX the earlier path in call, X% I we then mentioned that. guidance, down upmarket and XXXX. for The that mid-single-digit we market, down modeling on We're of

So we're that there we're while we X% in be quality still and And worse expecting downmarket stabilization. see QX. a QX bit in to We're discounting of growth to discounting hit our upmarket, believe We're the market accelerate is rely flexibility we downmarket little resources business, up in to just -- stabilization the market. which signs targets. did the that XXXX. a provides going our We're guidance, not to us our contribution down reallocating shift the on to

Henry Schuck

here we on with AI that data add there's the for an resourcing. to and just customers in us enterprise And our facto we're for the de should and that's why upmarket opportunity team. become think I partner go-to-market

Aleksandr Zukin

about talked to on about how increasingly particularly in ecosystem that it how the mean go-to-market maybe kind rates the state just on AI guys agents, you us everybody in I role close you give talking that, Henry, play on of right increase think now, with perspective And as side, I of the world you. see and Maybe we here. key for led your

Henry Schuck

Yes.

market, agents for it's building all that is to for needs it on go-to-market I for to support, a AI AI first who's knowledge in AI agent agent think data accurate who's data, agent That data third-party about who's go-to-market AI you you you the inside support your very data changing building support. customer on relies shrinking, be agent support don't lives AI need an services they inside It is tickets live and to where constantly needs data already It's and of a inside and or understand build data successful, data tremendous your teams. different data. only first-party go-to-market all for anywhere people customer AI data, points who's companies. amount different build who's key base That needs the for It for when contacts. than critical, on have. you're you're for are thing website, but AI are accurate signals order first-party if AI surrounded first-party of on and data. your you needs build needs these data, to the a be certain Those researching and hiring, with your who's trying signal lives growing, the in to laying when an great that the need first-party completely solutions off, of and then

to think is a of asset when BXB built component So data we've the we that. agents, go-to-market about that necessary our success AI

uptake be us go-to-market. to to why we're AI not us this our their we're married more for and for be go AI that's and successful. say, That's on us to third-party with We to come data business. and by build and seeing first-party this need think is customers data operations with I enough market to to seeing surrounded why

go-to-market agent a So I any into input key AI are build? think we

Operator

Stanley. of from Our the Porter Morgan Elizabeth next question comes with line

Elizabeth Elliott

I ask on the First Copilot to ACV. wanted

come focus mentioned 'XX the I fiscal new a think lot customer to you the and to base about transitioning installed side 'XX. is in and going over more

can sense that just the renewal or help upgrades get how for to migration. Will start at I upgrades? a understand Just help installed base path kind us of if us could moving the quickly over anything more to new opt-in these So wondering be was you in platform? pushed to

Henry Schuck

of We customers midst are to in the Copilot. our migrating over

it off doing are We cycle.

the So to We're We're it they're our shows solution. doing report that released outside behind they when We a to renewal happy a of those growth we're in we seeing want time. quarter, over. stand a pilot. teams double-digit ROI discipline are migrate copilot a impact still also We over drive customers, strong move customer tremendous pricing on as on value our when and at Copilot. this getting of customers that to migration renewal our And particularly date. out

X X,XXX we're in the in so about, examples comfortable pilot an that I as X of person of a the customers XXX-person a part ROI, monetizing job try the And of world. the as over search value copilot, off-cycle at upsell. to then and our talked of that took see value part and deployment And letting we largest or engines either renewal

we're in for at to are value both pricing with our the delivering going ways, we maintain that We it Copilot. but want customers discipline

Elizabeth Elliott

from a And we and Got from out as that some the playing to last how touch I of just improvement, encouraging see retention to we you then NRR growth to versus lapping benefit think XX% just new expansion really model. quarters. as on unpack side? that wanted the start it. get the in about business from the could could side couple drivers risk the to the 'XX, migrations And the up of calendar over XX% tick follow-up,

Michael O'Brien

talk inputs retention I'll improvement. some to Sure. of the about the

QX. reminder, Just the as retention in XXXX. XX% the for first improvement sequential was since our had We X-point sequential last at saw quarters. QX improvement stable X That we of a was

that But in and well had pretty X of back in lots certainly an that, XXXX. in that in downsell, in upmarket mitigating stabilize instead this opportunity is Upmarket, period. put Our during it's then market, more up shifting saw the over kind retention into And significant same, first opportunity. step upsell beyond kind We a but been quarters churn QX. upsell statement. improvement retention more a of to downmarket growth and downsell we've QX of the into defensive the I'll held of down, has upmarket. opportunity down really a saw we about

Operator

next comes Tyler Radke with the line from Citi. question Our of

Unknown Analyst

Tyler. This is for Ashely on

count. about maybe uptick on what to on the color in mix and uptick you little new going XXXX do Just Could addition wanted lens you be drove expect versus And ask to comment provide more the the pace customer a of this of forward? sustained bit expansion?

Henry Schuck

that can I Yes, cover one.

year the can $XXX,XXX, really, new logo ways So and then We We there's $XXX,XXX customers, where full change. we don't can that a usually a full it customers $XXX,XXX lose a -- that wasn't acquire above can can in sequential cohort upsell churn. below or even those at can on are churn. customers spending go decrease saw above out We point $XXX,XXX. customers up -- and in that to price we that downsell plus cohort, spending

upsell So existing and upselling improvement and up what We've got areas. seeing $XXX,XXX. success in opportunity more to the much we're is customers X other above really

below fewer level. then customers at way customers cohort $XXX,XXX from more and going we're successful above or upmarket that acquiring We actually $XXX,XXX losing that are out And down much downsell. a

So really, seen opportunity less exposure previously. renewed downsell we and had customer than acquisition, it's upsell

Operator

line from Raymond Our the of next Brian James. question with Peterson comes

Johnathan McCary

This Brian. on is for Jonathan McCary

potential much of NRR swing that on commentary the here. for you as have still guess, you on reliant just another is primary there? I How I versus So factor gave know way, upside do for But the XXXX what already some the getting built interval in the migrations? into mid-market guide outlook

Henry Schuck

mid-market upmarket a drag Yes. we vertical our being that going mid-single-digit experienced And enterprise our Last the we're plus No, of a growth, growth years we're software pressure. segment. with path about a a mid-market on the had to about downsell we're is way on of growth. to -- mid-market of as back specifically year, couple thinking is talked kind reminder, that

that think of upswing the within couple enterprise of and our kind upmarket a on there for the after So are we in accelerating had we is we're mid-market that the after years. framework headwinds opportunity I

Johnathan McCary

of it's to new Copilot attach that the uptake, you've are in land is -- on a the to then Is new it XXX% And close lands hear ACV the it. customers? mostly you that's good with new as you terms there. deal? on Got said new seeing commentary when rates how What penetration

Henry Schuck

our Yes, It's Copilot. majority take one, the can too. of customer new is I vast that on ACV

So early to went we on, think I up XX%. about

that the XX% that's it's new on think to that of Copilot. right is I number franchises ACV coming about plus

Operator

Our next the of Stifel. Lane line Parker from comes with question

John McShane

Jack for McShane on the business. It potential thoughts be to reported impact within on are guys your hear got I'd You've RX to Parker. Copilot. leveraging curious you model DeepSeek's that guys' your was

how So may cost result. on of a that change I'd as or performance either hear to some curious the potential be things improvements side equation the maybe

Henry Schuck

Yes.

using of First, it Copilot. wasn't it were reported that we inside

drive think with that across LLM tested price have other internally. we're excited to And We the most providers. I what DeepSeek potential about DeepSeek and ecosystem down its is

that the where ZoomInfo, is different testing do constantly models expect model this efficacy at ecosystem And production What across that date price, but internally we're continue a what not in outcomes. using is to drive we model we've down use a the with prices with the models LLM we're using. is providers. the in Copilots, had an cost DeepSeek we exponential across highest the decrease lowest and always have seen and DeepSeek to We model we're to for

John McShane

Got guys' rest it. I'm the the see when your curious that customers? then the quick parsing cohort. of growth. cohort you compared does more maybe to kind of to versus And one. of $XXX,XXX $XXX,XXX-plus kind of How I'd be characteristics X hear Understood. And upsell

Henry Schuck

got traditional upmarket cohort. opportunities, we more got AE, kind of We've Copilot. AM, imagine. it's question. vectors feed CSM, not additional you to and heavily but with we've good Yes, into them talk just as into would And cases use about opportunities expansion when that It's got functionality. take in RevOps our We've expand existing cross-sell customers space,

Copilot and sales that selling customers. to legacy operations, So OS,

upsell levers So to we feet product, the into $XXX,XXX do have cohort. price

Operator

Our comes Wells of the from line next with question Michael Berg Fargo.

Michael Berg

Michael Berg on in seat double regards just with wanted on for the to NRR, here. I click the to dynamic. Michael particular Turrin

I that looking, as about and lot a upmarket in the difference the talked part market down ops environment guess, of there's Copilot. any versus upselling You equation. was particular, in if How

Henry Schuck

think to first, it, XXX% X market, we're has, that think, going the in be I Well, call you if customer penetrated salespeople, XX down seat employees about count. that and a across

As you we're up less penetrated. market, much move

And XX,XXX customer salespeople, be those with penetrated in might of across X,XXX sales only and X,XXX so enterprise employees reps. an we

continues upmarket. And large be there opportunity a the seat expansion to in so

I think as we our have we're of to Copilot to where sold. outside excited about most it the thing historically sell ability relates that personas is

top the managers selling know account only customer signals of who of to get Copilot turn to funnel accounts their success expanded of in into instead so And in are is the managers, risk to no now front when using happening plan we've risk upsell data right prospectors, making to decisions. build at all fingertips be have call to account fly to to they their of on that know that to the and can the an time better in

the that can And sales it's how expand that sell we we're into. enterprise, expansion seats so the many can very to. we of seats all across persona But penetrated sell across that rare fully

Operator

from Brent comes next Our Piper the Bracelin of with line question Sandler.

Brent Bracelin

go to to the of I Henry, kind back wanted customer. $XXX,XXX cohort

of is characterization? company because customers. such new in fair software a seen of outside dependency this well that traditional say on net the we've X $XXX,XXX that a years. actually software churn small around because added maybe quarter. Is you. customers north worst you there's I the that is data behind the And landing looking spend for a could think I new those the customers most One in read That's

you is looking So the that correct? us new? on how thesis, would outside momentum through that seeing in that you're frame walk Or

Henry Schuck

in the upmarket Look, segment. that $XXX,XXX vast think our customers majority in that I cohort, across $XXX,XXX are cohort of our

in ] a the past customers business. the spend they gotten the right ZoomInfo, right in SERP environment, the I about take customer and market we've are is in think might $XXX,XXX right be that when a prescriptive their in ] we've [ small SERP really decision sure making in environment, so today. in upmarket that down the [ a where and packages been where trouble on a getting not you decision And our for And

ZoomInfo. upwards small spend And software not of so with seeing a sort you're company $XXX,XXX of

majority vast business. -- -- market vast, our cohort the in the seeing upmarket of our of above You're $XXX,XXX

Brent Bracelin

delta or aggressive pricing question wondering, relative know for into pricing happening? Are versus the has is aggressive me of not Helpful mid-market, that's the a some in been for in just upmarket while. SMB's on just color. you SMB, pricing pricing lead seeing to Any pricing. Last I

Henry Schuck

would view separately. them I

view we think changed. efficient got acquisition in the of earlier, our we've the customer like really models. And pricing And said then that market we nature have down pricing -- different the I hasn't a upmarket, market, as few I an play.

Operator

Markets. of Our next the with Jackson question Capital comes KeyBanc from Ader line

Unknown Analyst

and on that and competition is mid-market the could This quick Ader. call upmarket Maybe maybe think deals? even Jackson out puts further you upmarket, about guys you're takes Kyle different for ones. When the seeing we X are Copilot those particularly just Great. any with versus I Diehl there and further first

Henry Schuck

we we're As and what fit up differentiation you market market. stronger down than move our is meaningfully is product market, see seeing upmarket what our that

win down upmarket and market. an place to in we're incredible much And than much differently compete differently so

have resourced We fit. product We're market properly. great

have advantage products, that competitive the form the I for and several market about are advantage. we segment the us. think that growth We durable largest that opportunity When aspects to have, presents that combine right there

our is AI data, driving incredibly things data highly driving advantage accuracy of and that then as directly of velocity well. wins of innovation the market, all our regulatory what's the value-additive The important. are and around durable breadth, what's revenue in it's data compliance those outcomes updates first, and our types industry-leading And data like and go-to-market, upmarket, posture up together. pace our our depth competitive that's of that to the intent also drive coming It's

Unknown Analyst

X you. then for Okay. maybe Great. Graham, And

the a fourth when of quarter the kind enterprise? together you've perspective out couple maybe And guide how macro think what of play you're in the kind macro 'XX putting towards a times the more of the out just a of downmarket for attention the mid-market anticipating perspective? discounting here we from from at and called about you're with 'XX, think that What overall, about I guide. as

Michael O'Brien

in was us, Yes. strong have into or momentum QX don't QX it XXXX. gets worse and a carrying saw really it about quarter the pretty And macro for that think guide. prior. the Good in question. I from don't really better expectation was where think change we're an we optimistic I that we

Operator

Our next Markets. Jaluria from line RBC the Capital comes question with of Rishi

Unknown Analyst

Rishi. mentioned of Has to This in you ask implemented any headwind. QX? expecting the past, I you amount from that wanted XXXX? is that believe to leading down $X level that on about changes changed the policies in you disqualification a for new are a Fountain Chris to market business I it month was And million

Henry Schuck

don't That that. hasn't changes changed. any to anticipate We

Operator

the Patrick Citizens Our with of from question next Bank. line comes Walravens

Austin Cole

wanted I in of This ask, continued I to Pat upmarket is kind market out there just to just Cole on QX. seen the Austin related for we've guess, the layoffs in Walravens. some

to strengthening path might to drivers that as of you of Just commentary of on kind are even your of kind gives maybe just you being can path kind a that growth of beyond us And the then double and of the of that durability quick upmarket sense digits? what confidence? follow-up, give there? digits, that of a accelerate and just mid-single given What what further of kind kind

Henry Schuck

I our in focused upmarket what enterprise execution and is seeing you're on in our and Look, segment. steady -- growth slow that think

it resourced growth. have for We

We have segment. innovation for that product driven

on from perspective. focus that We continued have to a services segment

improvement continue in and into and I better or a XXXX. the that's a came think across little at And result, market, all a it that so don't And as of in metrics bit going all better seeing of a we're the a as is been think I better this one enterprise. the of has little to and we momentum bit little bit timing drumbeat This getting view once. that sort steady

They that within growth and more a Copilot, accounts. think their their and because accelerate Copilot they're they're for couple opportunity take and operations expansion confident persona think to their more have how business. you And a our of I It's it's I with it's you things. think when are Copilot, our about more do becoming sellers using own more now large enabled Copilot internally operations. customers. to

of And growth Copilot to the that confidence we'll within so enterprise. of there's accelerate be able both a the lot operations

Operator

showing further program. your at you the conference. time. for participation today's I'm questions does Thank this conclude This no in

now disconnect. may You

ZoomInfo (ZI) 25 Feb 252024 Q4 Earnings call transcript