NYSE$ZETA

Zeta Global Holdings Corp · Q3 2023 earnings

Q3 2023 earnings · · Investor relations

Briefing

Zeta Global's Q3 2023 performance was marked by record revenue and expanded customer base.

Zeta Global reported record revenue of $189 million, a 24% year-over-year increase. The company grew its total Scaled Customer count to 440 and Super Scaled Customer count to 124, while also expanding Scaled Customer ARPU by 10% year-over-year. Zeta generated $23 million in cash flow from operating activities and $13 million in free cash flow, representing increases of 17% and 43% year-over-year, respectively.

  • Delivered record revenue of $189M, an increase of 24% Y/Y
  • Grew total Scaled Customer count to 440, an increase of 15 Q/Q, and Super Scaled Customer count to 124, an increase of 6 Q/Q
  • Expanded Scaled Customer ARPU 10% Y/Y, marking the 13th consecutive quarter of double-digit growth
  • Generated cash flow from operating activities of $23M, an increase of 17% Y/Y, and Free Cash Flow of $13M, an increase of 43% Y/Y

Headline financials

Total Revenue

$189M

Previous: $152M+24.1%
EPS (adj)

$0.05

Previous: -$0.49+110.2%
Capital Expenditures

-$14.9M

Previous: -$17.2M+13.3%
Free Cash Flow

-$58M

Previous: -$86.6M+33.1%
Net Income

-$43.1M

Previous: -$69.4M+38.0%
Operating Income

-$37.2M

Previous: -$66.2M+43.8%
Gross Profit

$116M

Previous: $94.7M+21.9%
Cash & Equivalents

$121M

Previous: $115M+5.2%
Total Assets

$511M

Previous: $441M+16.0%
R&D Expense

$18.1M

No prior period
Stock-Based Comp

$57.7M

Previous: $75.2M-23.3%

Revenue & EPS history

Zeta Global · Revenue · Quarterly

$189M

Q3 2023+24.1%vs Q3 2022
Beat estimate in 13 of 15 quarters(87%)
ActualEstimate

Forward guidance

Zeta anticipates increased revenue and Adjusted EBITDA for the fourth quarter and full year 2023.

Tailwinds

  • Increasing revenue guidance to a range of $205 million to $209 million (including $1.3 million of M&A contribution), an increase of $0.5 million at the midpoint from the prior guidance of $206.5 million. The revised guidance represents a year-over-year increase of 17% to 19%.
  • Increasing Adjusted EBITDA guidance to a range of $41.7 million to $42.2 million, an increase of $0.3 million at the midpoint from the prior guidance of $41.7 million. The revised guidance represents a year-over-year increase of 29% to 30% and an Adjusted EBITDA margin of 20.0% to 20.6%.
  • Increasing revenue guidance to a range of $723 million to $727 million (including $5.2 million of M&A contribution), an increase of $10 million from the midpoint of the prior guidance range of $712 million to $718 million. Revised guidance represents a year-over-year increase of 22% to 23%.
  • Increasing Adjusted EBITDA to a range of $126.3 million to $126.8 million, an increase of $2.1 million from the midpoint of the prior guidance range of $124.2 million to $124.8 million. Revised guidance represents a year-over-year increase of 37% to 38% and an Adjusted EBITDA margin of 17.4% to 17.5%.
  • Zeta is committed to leading the intelligence-powered marketing transformation, delivering better experiences for consumers and better results for brands.

Headwinds

  • global supply chain disruptions
  • macroeconomic and industry trends and adverse developments in the debt, consumer credit and financial services markets and other macroeconomic factors beyond Zeta’s control
  • increases in our borrowing costs as a result of changes in interest rates and other factors
  • the impact of inflation on us and on our customers
  • potential fluctuations in our operating results, which could make our future operating results difficult to predict

Historical earnings impact

How earnings announcements have historically affected this stock's price.

Avg. return before/after earnings

Based on 20 quarterly earnings reports · overlaid with Q3 2023

Historical avgQ3 2023

+2.3%

Avg return

Earnings day

-0.7%

Avg return

5 days after

+0.2%

Avg return

30 days after

63%

15 / 24 earnings

Positive

+21.6%

Q2 2022

Best reaction

-20.7%

Q3 2024

Worst reaction

Earnings price reactions
QuarterReport dateReaction (Day 0)+5 days+30 days
Q1 2026+1.0%-6.5%+24.4%
Q4 2025+5.1%+2.4%-14.3%
Q3 2025+19.4%+19.1%+14.1%
Q1 2025+1.3%-2.1%-2.6%
Q4 2024-13.7%-19.6%-33.2%
Q3 2024-20.7%-50.6%-39.5%
Q2 2024+14.3%+4.6%+25.9%
Q1 2024+20.0%+23.2%+29.0%
Q4 2023+2.6%+0.0%+5.8%
Q3 2023+3.8%+4.2%+8.2%
Q2 2023+6.1%-5.9%-14.9%
Q1 2023-9.6%-10.6%-2.9%
Q4 2022+16.3%+15.3%+11.4%
Q3 2022-3.4%-0.5%+5.3%
Q2 2022+21.6%+27.2%+16.0%
Q1 2021-9.7%-2.2%-21.5%
Q1 2022-0.7%+11.0%-7.6%
Q4 2019+8.9%-7.6%-8.6%
Q4 2021+5.7%+15.0%-3.4%
Q3 2020-0.2%-6.3%-14.6%
Q3 2021-3.5%-7.6%-17.5%
Q4 2020+1.0%-7.0%+17.5%
Q2 2020+1.0%-7.0%+17.5%
Q2 2021-10.5%-4.8%+11.0%
Q1 2020

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