ZoomInfo Technologies (ZI) investor relations material

Key business developments

• Q2 marked rapid innovation, with strong traction for new AI-driven products like GTM Studio and plans to roll out hybrid consumption pricing for greater customer flexibility later this year.

• Restructuring led to improved profitability, with over 100 basis points of adjusted operating margin improvement year-over-year and continued strong free cash flow generation.

• Non-software verticals showed improved gross retention and enterprise new business at the $100,000+ level reached a record high, while software remains pressured by budget and headcount constraints.

• The business is shifting upmarket, now 76% of revenue, with upmarket customers showing higher retention and more attractive LTV to CAC ratios compared to down-market.

• Operations (DaaS) segment grew 20% and now represents about 20% of the business, driven by large companies scaling AI initiatives and seeking robust data foundations.

Product and pricing strategy

• Hybrid consumption pricing will be piloted with new business at the end of Q3, aiming for simplicity, reduced barriers, and alignment with customer usage patterns.

• The transition from seat-based to usage-based models is both reactive to customer demand and proactive for future growth, with flexibility to accommodate diverse customer preferences.

• Pricing will use a credit grid system, with customers pre-committing to credits and flexibility in the first year to ease adoption.

• The company aims to mimic the financial performance of the Operations segment across the broader business by decoupling data from seats and expanding use cases.

• Product roadmap for the second half is ambitious, focusing on new AI and data products, with leading indicators tracked through consumption trends in new and headless products.

Market and competitive landscape

• Down-market is being deliberately deprioritized, with accelerated decline expected, while upmarket faces less competition and offers better economics.

• The competitive advantage is rooted in the breadth and quality of the proprietary data asset, which is increasingly valued as AI adoption grows.

• The sales enablement and workflow tooling space is crowded, but flexibility in product delivery (application, headless, API) is seen as a key differentiator.

• Wallet share opportunity remains significant, with a shift toward more à la carte offerings to capture greater share within the install base.

• Key KPIs for investors include upmarket net retention, overall net retention, and consumption trends in new products and expanded surface areas.