8-K: Zeta Global Announces Record Financial Results, Exceeds $1 Billion in Revenue for 2024

Zeta Global reports a strong finish to 2024 with record revenue and outlines ambitious growth targets for 2028.

Summary

• Zeta Global announced its financial results for the fourth quarter and full year ended December 31, 2024.
• The company delivered revenue of $315 million in 4Q24, a 50% year-over-year increase, and $1,006 million for the full year, up 38% year-over-year.
• Scaled Customer count increased 17% Y/Y and Super-Scaled Customer count increased 13% Y/Y.
• Scaled Customer ARPU grew 19% Y/Y to $1.87 million in 2024.
• Cash flow from operating activities was $44 million in 4Q24 and $134 million in 2024.
• Zeta is guiding to its sixth consecutive year of 20%+ revenue growth.
• The company has announced Zeta 2028 plan targets with revenue of at least $2.1 billion, Adjusted EBITDA of at least $525 million, and Free Cash Flow of at least $340 million.

Sentiment

Score: 8

Explanation: The document presents a positive outlook with strong financial results and ambitious growth targets. While there are some negatives, the overall tone is optimistic and confident.

Positives

• Zeta Global achieved record financial results in 4Q24 and full year 2024.
• The company experienced significant revenue growth, with a 50% increase in 4Q24 and a 38% increase for the full year.
• Zeta Global increased its Scaled and Super-Scaled Customer counts.
• The company improved its profitability, with GAAP net income of $15 million in 4Q24 compared to a net loss in 4Q23.
• Cash flow from operating activities increased significantly in both 4Q24 and full year 2024.
• Adjusted EBITDA and Adjusted EBITDA margin improved year-over-year.
• The company is guiding to continued revenue growth and profitability in 2025.
• Zeta Global has announced ambitious long-term growth targets with its Zeta 2028 plan.

Negatives

• The company reported a GAAP net loss of $70 million for the full year 2024, primarily driven by $195 million in stock-based compensation.
• GAAP cost of revenue percentage of 39.7%, increased 210 basis points Y/Y.

Risks

• The company's forward-looking statements are subject to risks and uncertainties, including macroeconomic and industry trends, potential fluctuations in operating results, and the impact of new generative AI capabilities.
• Zeta Global's ability to achieve its growth targets depends on its ability to innovate, attract and retain customers, and manage its growth effectively.
• The company faces risks related to data privacy and security, as well as potential disruptions to its third-party data centers and systems.

Future Outlook

Zeta Global anticipates continued growth in 2025, with revenue projected to increase by 23% to 24%. The company also outlined its Zeta 2028 plan, targeting revenue of at least $2.1 billion, Adjusted EBITDA of at least $525 million, and Free Cash Flow of at least $340 million.

Management Comments

• At Zeta, weve consistently skated to where the puck is going.
• Our early investments in AI and first-party data are resonating with customers and prospects, fueling our record fourth quarter results and contributing to our market share gains, said David A. Steinberg, Co-Founder, Chairman, and CEO of Zeta.
• We believe these investments will propel us to over $2 billion in annual revenue by 2028, as outlined in our Zeta 2028 plan.
• Our performance is best summed up by consistency and momentum, said Chris Greiner, Zetas CFO.
• We exited the year at our highest ever growth rate of 50%, while notching our 14th straight quarter of beat and raise guidance.
• But more importantly, we are in rarified air when it comes to delivering 20% revenue growth and free cash flow margin expansion annually from 2021 through 2025an accomplishment only 7 other public technology companies can point to, out of more than 500 in the US.
• And to put an exclamation point on it, our newly announced Zeta 2028 plan targets doing the same for the next 4 years.

Industry Context

Zeta Global's focus on AI and first-party data aligns with the growing importance of these areas in the marketing technology industry. The company's growth and profitability demonstrate its ability to compete effectively in this dynamic market.

Comparison to Industry Standards

• Zeta Global claims that only 7 other public technology companies can point to delivering 20% revenue growth and free cash flow margin expansion annually from 2021 through 2025.
• The company's Zeta 2028 plan targets an Adjusted EBITDA margin of 25% and a Free Cash Flow to Adjusted EBITDA ratio of 65%.

Stakeholder Impact

• Shareholders can expect continued growth and profitability, as well as potential returns through the share repurchase program.
• Employees can benefit from the company's success and growth opportunities.
• Customers can expect continued innovation and improved marketing solutions.
• Suppliers and creditors can expect continued business and timely payments.

Next Steps

• Zeta will host a conference call on February 25, 2025, to discuss the financial results.
• The company will continue to execute its Zeta 2028 plan.

Key Dates