10-Q: Zeta Global Reports Strong Q2 2026 Revenue Growth

Zeta Global Holdings Corp. announced a significant 43.5% year-over-year revenue increase for the second quarter of 2026, driven by new and existing customer growth and the Marigolds Enterprise Business acquisition.

Summary

• Zeta Global Holdings Corp. reported a substantial increase in revenue for the second quarter of 2026, reaching $442.8 million, a 43.5% rise compared to $308.4 million in the same period last year.
• For the first six months of 2026, revenues grew by 46.5% to $839.1 million, up from $572.9 million in the prior year.
• The company achieved net income of $8.2 million for the quarter, a significant turnaround from a net loss of $12.8 million in Q2 2025.
• Adjusted EBITDA also saw a strong increase, reaching $91.7 million for the quarter, up from $58.8 million in Q2 2025, with an improved margin of 20.7%.
• The acquisition of Marigolds Enterprise Business contributed $48.1 million to Q2 2026 revenues.
• Super-scaled customers increased by 17% to 197, with Average Revenue Per User (ARPU) rising to $1.8 million.
• The company ended the quarter with $310.0 million in cash and cash equivalents.

Sentiment

Score: 7

Explanation: StockSavvy.ai views this filing as cautiously optimistic, reflecting strong revenue growth and improved profitability, though with ongoing investments and some lingering integration costs.

Positives

• Revenue increased by 43.5% to $442.8 million in Q2 2026 compared to Q2 2025.
• Net income turned positive at $8.2 million for Q2 2026, compared to a net loss of $12.8 million in Q2 2025.
• Adjusted EBITDA grew to $91.7 million in Q2 2026, up from $58.8 million in Q2 2025, with an improved margin of 20.7%.
• Super-scaled customers grew by 17% to 197.
• Average Revenue Per User (ARPU) for super-scaled customers increased by 17% to $1.8 million.
• The Marigolds Enterprise Business acquisition contributed $48.1 million in revenue for the quarter.
• Cash and cash equivalents stood at $310.0 million as of June 30, 2026.

Negatives

• Cost of revenues (excluding depreciation and amortization) increased by 54.7% to $181.0 million in Q2 2026, outpacing revenue growth.
• Acquisition-related expenses of $1.7 million were recorded in the first six months of 2026, with no comparable expenses in the prior year.
• Restructuring expenses increased significantly to $6.8 million in the first six months of 2026 from $3.2 million in the same period of 2025.
• The company has an accumulated deficit of $1,064.9 million as of June 30, 2026.

Risks

• The company's success and revenue growth depend on its ability to add, grow, and retain super-scaled customers.
• Long sales cycles can make it difficult to project when revenue will be generated from new customers.
• The technology industry faces increasing scrutiny, which could lead to negative regulatory actions.
• The company's ability to collect and use online data is threatened by new consumer tools, regulatory restrictions, and changes to web browsers and mobile operating systems.
• Actual or perceived failures to comply with data protection, privacy, and security laws could adversely affect the business.
• A significant data breach or security failure could be detrimental to the business, reputation, and financial performance.
• Dependence on third-party data centers, systems, technologies, and AI models poses operational risks.
• Evolving regulatory frameworks around AI development and use could adversely affect the business.

Future Outlook

The company believes its existing cash and anticipated net cash from operations, along with available credit facilities, will be sufficient for at least the next 12 months. However, future capital requirements will depend on various factors, and the company may seek additional capital through equity or debt financing, though no guarantee of favorable terms or availability can be made.

Management Comments

• Our success and revenue growth depends on our ability to add, grow and retain super-scaled customers.
• We often have long sales cycles, which can result in significant time between initial contact with a potential customer and execution of a customer agreement, making it difficult to project when, if at all, we will generate revenue from those customers.
• We may experience fluctuations in our operating results, including during presidential and, to a lesser extent, midterm election years where we generally generate higher revenues, which could make our future operating results difficult to compare and predict.
• If we do not manage our growth effectively, the quality of our platform and solutions may suffer, and our business, operating results and financial condition may be adversely affected.
• Our industry is intensely competitive, and if we do not effectively compete against current and future competitors or fail to innovate and make the right investment decisions in our product offerings and platform, our business, operating results and financial condition could be harmed.

Industry Context

StockSavvy.ai notes that Zeta Global operates in the highly competitive marketing technology sector, characterized by rapid AI advancements and increasing data privacy regulations. The company's focus on an AI-powered, data-driven cloud platform positions it to capitalize on the trend towards personalized marketing at scale, but also exposes it to significant competitive and regulatory risks.

Comparison to Industry Standards

• The company's revenue growth of 43.5% in Q2 2026 significantly outpaces the general growth rates seen in many established marketing technology firms, which often experience more moderate single-digit or low double-digit growth.
• The increase in Adjusted EBITDA margin to 20.7% is a positive indicator, though direct comparison to peers requires careful consideration of their specific definitions of Adjusted EBITDA, as non-GAAP measures can vary widely.
• The company's investment in R&D as a percentage of revenue (approximately 9.5% in Q2 2026) is substantial, reflecting a common strategy in the tech sector to maintain a competitive edge through innovation, though it is higher than some more mature players.
• The significant increase in Cost of Revenues (54.7%) relative to revenue growth (43.5%) suggests potential pressure on gross margins, an area to monitor against industry benchmarks for similar SaaS providers.

Legal Proceedings

• In re Zeta Global Holdings Corporation Securities Litigation: The U.S. District Court denied the motion to dismiss, and the case will proceed to discovery. The company is vigorously defending itself and believes the claims are without merit.

Stakeholder Impact

• Shareholders: Positive impact from improved revenue and profitability, but ongoing accumulated deficit and potential future capital raises could dilute value.
• Employees: Continued investment in R&D and sales/marketing may lead to growth opportunities, but also potential restructuring costs.
• Customers: Continued platform development and AI integration aim to enhance customer value and personalization.
• Creditors: Compliance with debt covenants and strong liquidity position are positive indicators.

Next Steps

• Continue to invest in research and development to enhance the technology platform.
• Continue to invest in marketing initiatives to drive growth.
• Monitor and manage operating expenses, particularly cost of revenues, to improve gross margins.
• Evaluate future capital requirements and potential financing arrangements.

Key Dates

Recommendation

The strong revenue growth and return to profitability are positive indicators. However, the increasing cost of revenues, significant accumulated deficit, and ongoing litigation warrant a cautious approach. While the company is executing well operationally, the competitive landscape and regulatory environment present ongoing risks that suggest a 'hold' rating until further clarity on sustained profitability and resolution of legal matters.

Keywords

marketing technology, AI-powered platform, customer intelligence, marketing automation, omnichannel marketing, data-driven cloud, consumer insights, enterprise software