Zeta Global (ZETA) 27 Feb 242023 Q4 Earnings call transcript

Greetings. Welcome to the Zeta Fourth Quarter 2023 Earnings Conference Call. [Operator Instructions] Please note, this conference is being recorded.I'll now turn the conference over to Scott Schmitz, Senior Vice President of Investor Relations. Thank you.

You may begin.

operator. you, Thank thank quarter and joining for us Hello, full you year fourth and XXXX Zeta's everyone, for conference call. call earnings investors.zetaglobal.com also the Today's Relations other information SEC and release me on with available presentation on revenues strategies.These Chris and like David our Financial this goals Zeta.Joining well as Officer.Before other Chief in and Zeta's filings, and release about website our to are the Chairman statements to along the today at business statements links actual risks made to Zeta's objectives everyone projected. as of statements Zeta's call subject that statements materially and including presentation regarding where and outlook, our and Chief begin, find may I'd will and about Greiner, Co-Founder, you uncertainties cause Steinberg, differ to plans Executive remind our results market that Officer; developments, and and we are earnings Investor products financial products, potential potential forward-looking our and those on are events from future contain competition of for in only addition, to filings references in These release of other earnings those GAAP addition as and supplemental non-GAAP with our certain substitute as to results. should our date.In speak considered risks and the which described the today's discussion be and today SEC include and include uncertainties company's will a measures, financial not believe provide investors. use these in our for We useful information business measures the they non-GAAP managing and our now to the the the I website on earnings the other can non-GAAP where found the as earnings in David. turn appropriate, will filings and our to that, measures with measures, available over GAAP release SEC.With of call Reconciliations well as corresponding presentation be

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level stock-based from Chris compensation way XXXX guiding X.X% evolve bring how down are X% Zeta's we a to By of foundation we culture to and fourth from dilution goal profitability gap senior achieve we're the planning of build to X.XX% to our addition from to to time, terms trajectory us compensation, incentivize places strong First, to changes, in share continue in align with stock-based management. XXXX.In incentive-based quarter in our same the of also with which are units, to year. not to incentive a is with receive along this the price responsibility. Equity invest pre-IPO corporate will and in innovation compensation, benefit of performance XXXX.At I, to planning a closely shareholder on and any Instead, flowing restricted These more on Greiner lower of to shares Zeta stock creation. others, based tied of are compensation P&L, example, appreciation value continuing in through the would be

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David. line. but I'm punch we're that with you, me excited today, covering Thank start for the all let

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expanded XX% EBITDA of XX% was $XX flow year-to-year, year-to-year.Cash EBITDA of free adjusted flow to ahead points was rate expansion of the On XXXX, Zeta delivered part adjusted XQ over Excluding IPO, as X excluding same slowed to margins a the total compensation, $XXX.X straight year-to-year, EBITDA, the have up XQ was cash would management of points generated compensation adjusted years operating of revenue. run up productivity XXX adjusted been XXX sales we million, adjusted is margin stock-based and XXth the implied points disciplined margin million, as $XX expense, down $XX.X resulted from up In operating points continued of XXXX. to up margin better basis quarter, basis the million EBITDA with basis we're full XX.X%, year-to-year. our activities And of $XXX year, Full-year down This expansion. XQ a revenue.Our up percentage percentage visible as target accelerated million. expense year-to-year. a basis, year-to-year, with XX% in XXX expensing of related million, EBITDA and XX% basis X% growth we XXX quarter, XX.X%. margins XX% with stock-based leverage year-to-year, in we've

For the cash XX% working of headwind, our up year, with up capital flow primarily activities year-to-year. free agency wrap despite This, $XX a with $XX year-to-year, million, expansion operating was flow guidance. full million cash million, of the $XX from business.Now XX% I'll from

to And see X.X% to this as cash of details, XXXX range. XX% free the to we we're showing in the quarter at full starting to can from in enroute outlined XXXX.As year-to-year XX, ahead for midpoint our year flow, on and First, XX to five, in fourth points an communicate prudently the increase we're full up our guiding even the capital those like wrap revenue midpoint to in the added handful $XXX newly along in and XX% of the as is X% we're as from Three, year-to-year last associated upon X.XX% take conservative, see which revenue dilution HoldCo each you our on quarter on reference to Slide candidates. based the year the as up cyclicality. stock of customers. Slide $XXX full revenue EBITDA revenues as decrease point.Four, million, our consideration cash guide deck. a of we of David of of which slides agency Slide We starting lines, million, we're simply GAAP conversion approach providing by into quarter showing a year, incentive-based Street, year much with of XXXX on XXXX is working guidance at adjusted political the targeting a supplemental One, XX, mentioned, guidance year to for supplemental.Two, seen profitability by how at guiding the we're political headwinds first each and skew quarter's compensation

a cash $X at million, with We're in midpoint XQ. of with first candidate in adjusted starting million in of range. quarter of guidance the of full XX.X% adjusted $X We the $XX.X margin, flow XQ, million growth conversion XXXX.In EBITDA by million rate in already $XX $XXX from the XX% translating in at and free high placeholder hand million, your XX% XXX the midpoint visibility EBITDA the XX% range the margin points, guidance, EBITDA or and million, our We're million, Street's adjusted to guiding guiding of $X Operator? of political representing we operator have that, XXXX midpoint, year as the with of $X for XQ, the of of a a full-year $XX to by in revenue to million exceeds David good our see EBITDA $XX adjusted to throughout starting basis me point, to XXXX that and million, layer summary, take let at me year.With up which call tailwinds back questions.

Instructions] first Our with Ryan from MacDonald question [Operator is Needham Company. &

an investments. XXXX, excellent product about of quarter. we about really on sort and priorities talked the you And interesting around some think some strategy interesting as congrats David, in

you're sort newer contributions think mean look about you I of of of Agent sort maybe of at we impact do outlook in magnitude and mobile strategy, terms As the or how from impact, mobile Composer, expectations Intelligent -- any offerings? these the XXXX how into building from

we and we we're it. incredibly new development, guidance obviously to proud were the We Well, When about to talk that you think don't should need the at we of always that quarter. giving. appreciate look philosophically, think that I get

to the revenue at including we fully to it's think we expect we we perspective. investment deliver from investment are investment mobile, company look agent, we of perspective.But into in look our into the the it how and a also from a it the in what about into as guidance already not intelligent baked So

when -- the started is Now, think, where year Wild where the joke become think to XX%. small post which ecosystem, will starting at can obviously, like perspective one that our sell call very time, really just we're And additional X%, think mobile the opportunity there. of I attribution artificial products revenue at most are year, the talked that, believe last about. taking that's Chris focus we And sample, deterministic remember on that for that, for they're a using go numbers almost IDFA, only the he the massive extrapolating mobile a whereas what into said, and we are is is best instead we This West the it's estimates would hit, first organizations to the we those it the most to really either from one it we of put intelligent intelligence finished them elimination of at Zeta year, using agent be correctly, of those efficiency. begin I upside. This we if XX% XX%, would ID.If year feel part be the would I a consistent. I and give We are XX%. I already And guidance were starting not said of upside at the out us a

Really helpful. Maybe as a follow up, Chris, for you.

So maybe X the as topics with to talk well. about guidance

year, curious just obviously, that in that seeing why sightlines or you just maybe this million So there? was in the building about the auto you're on you're this and upside insurance building the challenged the year, that felt right from market, maybe terms confidence conservatism talk starting And point political contributions in you're pipeline a for what $XX and potential from industries recovery you you year? can last what seeing then or of there maybe gives stabilization

frankly, vertical, the question visibility X and first short answer sales the challenged starting Much insurance the On around automotive late that, the the of good verticals, the into XQ. pipeline. already very vertical is

already will first beginning it So in to start the in quarter. feather

that though, in we start relates of also really and political. latter to million off baseline of just to $X.X year.As likely wanted it it around in half the political industries We recall you'll probably even of is part our growth of the to to about half the with XXXX. of see starting was XXXX, back feeling was the did that of XXXX, revenue, what political XXXX some recall, which your tends good that those other good about return that, What's conservative. question, this to So, advocacy in in of draft did first assumptions, to we was $XX million knowing

and are of upside and revenue visibility assuming as well. as provide have we'll would So with the conservative for year, combination revenue in the outlook throughout and groups, we our probably to continue what candidate do both candidate we're political the to work advocacy

Stanley. Porter Elizabeth is next Morgan from question Our with

back provided to to go you that the wanted mobile. I example in

there it department. was about in hands marketing I talked into of end interesting, may traditional salespeople, the getting sounds You you user thought technology and getting new which of the be like a the outside

of opportunity? if buyer do the who TAM within to wallet kind So on plan we this so, segment a potentially And Should as to a might addressing with segment. you would compete an new expander? how love you expect additional hear

as usual, is we Elizabeth, to it. yes both. question, appreciate answer The Great

we we've channel that efficacy see lot to an pretty dramatically as customers, add around, our to around there of frankly, you super So TAM about mobile there. was existing because, which the would while quite a scaled increase IDFA because mobile never and and in opportunity really a players played ecosystem, running our think today of was it, scaled were there, there a lot when

mobile assets which identify a the With of we the which can elimination position $XXX individuals, own, already in number, is ecosystem. to puts us the channel take IDFA, ID which we the plus we can efficacy we can where that of million Zeta very back that unique opted-in has the dissipated radically.So the tie it in

gardens. outside mobile advantage the nobody walled So it gives has the else us that in of an ecosystem

developments a well.So as to same want So from there's the what CIOs is opportunity technology time, to our to also to function. very just to this businesses to other addition big marketing the the the their of of it Zeta CIOs. directly out power focusing the At I technology some that. going in technology finding the relates you're we're buy unique CIOs very see functions to do of our to on to selling it's as sale expand And the opportunity think year marketing to

with the more or with agencies hand, cycles decision-makers with sitting versus the you hand, to there wanted as you sales any have lengthening sales follow-up, have Great. you directly working on the cycles partner. as ask a And On just about that with opportunity one I enterprises. more accelerated Is for agencies? working sales trusted agency but cycles you're at that other have table, might

Yes.

another great question. it's So

when interesting. with X in them agencies, you X ways. It's think of with work I you very work

to enterprise from the enterprise, master you go you're procurement, Fortune dramatically an it to through You to ourselves. some companies contract directly X is whereas in to legal, as perspective, up we doing it a from take through enterprise faster XXX in can when when agency, Put than on. relationship turning in through go and then to go which data the move with it's HoldCo, security, months partnership

the moves agency HoldCo thing is, seeing there is very to do that what And clients, that And massively expanded manage slot. behalf scaling it from the agencies the are business other the enterprise they're what to we're we're say, on some X let's So X are starting very, we've now quickly, quickly.The side themselves. where do as this. sales of literally just but of to shortening marketing able

back. a first, with HoldCos to is to is significantly welcome HoldCos to are role spend and of XX expand, bigger on evolve the recent the and note with that our the first recent is agency starting playing direct mix journey Slide shift On but understanding shown relationship HoldCos. what a now revenue their we revenue the those Elizabeth, this of time new Zeta, recently, HoldCo integrated initial over is also are time. years several And investments and in with topic between that. lot investors because what And we've on that Slide XX, from opportunity ago you'll same our

So out, XX. think, I it's laid Slide on well

from is question with Craig-Hallum. next Our Jason Kreyer

of customers how opportunity the your AI wanted that? conversations quarters, if with evolving ask can then couple I to you maybe last around with and evolved Zeta's summarize you just have David, see over how maybe

data, the and is I said I'm when in client's put right?So theoretical of think you they're what's look down then that which a closed data scripted what our for seeing a ecosystem in append here, CDP stays then I to inside the to of And boardroom. it's creates your what's sort secure they we something my lot, AI the I our notes, calling moved often what me sort our strategy. and the keep AI at starting of saying and how say the yell has really in we As from do ability AI And in. sure that then a at you're protected And data strategy those saying, They make able are our and do go saying, data CMOs to our to strategy? place, Board is do CMO, CEO, and and safe?

inside of many and some billions trillions to their data cases, in operate of adding, the points can algorithm data. in even cases, And their. You're

a of talking language lot models. way of you've example, large by about people got So

I people got You've language models. talking about model. language small a we're some joke, like to midsize

again, of with We that for safety, enough new you of security, do to disintermediate get talking that look paid CMO highly is have products, even is disintermediating clients' ecosystems. bodies just They product, work. models cases, And once every benefits agent in data going language scientists our not I'm of to to the the our efficiency small models anybody. at the asking around can't inside their privacy for some large language for it's data.And very the business. and our the And

out talking do $XXX,XXX scientist year and on they're out. So you a paying a is, sell the our $X,XXX, that now in in basis the tell we data is algorithms But And at day-to-day this to $X,XXX you of have.So to which solution scaled that of we ability I without our Jason, $XX,XXX you, the by conjunction going way, you're instance? conversations. number data, seeing our thousands And if pay that conversation. becoming it you're And numbers data ripple to do just hard allowing I has to projections. not our reasons a think us would that risking through not roll with and subscription out their has of by is into them. our And the have data ripple a a month ether, place, Why superscaled and their listen, one the per to it it's operate of that with Zeta putting the clients automate as game-changer actually all that a year. times, in through way the the been look as ever CDP into environment with the or

one in squeeze to for wanted Chris. I

gross and I the agency just direct and influence know margins, and on you talked Just about indirect.

trajectory QX. want slide ask -- from QX I of just to of you've a we gross telegraphed to saw little kind think I appropriately the on margins. bit that

kind get Or bottom of of gross of mix? the do have you As think look idea in we've before bottoms an the do a hit we out that margins? you XXXX, when reacceleration you into direct

Okay.

gross -- our bottom I and you out, think margins, it's did that, think it head at well, or it So on bottoms is I this articulated is is really where XQ, out.

then With to new the level, customers those kind channels. Lever agency in large to see is upside usage who end our direct margin how setting grow in. from tied lever move political we quickly now and #X on happen and at XXXX, to of the the upside insurance we there also is automotive of how to of platform.And mix direct start be so in gross comes integrated our That's the customers third, at where base XX% advocacy our the beyond higher #X. quickly again, terms that channel

at X point up to year, way XX%. should of work begin that So the our starting base around throughout those

Bank question next of Our from is with Koji Ikeda America.

me from here. couple A

I you. about customers one, First question wanted to with boomerang ask a

decade the You years days. many Zeta has before, changed quite a have market since the platform now, and early Zeta XX sure plus, guys over in bit but for customers a out the the over I'm have my past gosh, the tried platform been

hear to before? Zeta bit about to the back? a just come so the why back And wanted how customers have after customers some about you've seen are Zeta commentary reasons What common little of come most trying

platform for that like came funny, a X move owned large but the a felt the after at like was to houses to us point about to very a been because of clouds use talk to here you recently where Koji, been future, laughing everything. largest scale I might big term there years was could. needed marketing large platform we've corporation.And they because leaving using be by we which world's a we're they disintermediating thing so found deliver of back clouds, where, marketing actually Zeta And couldn't it's everything. one lot had sort really, what one mean, Think solutions, of they us X big holding it's a fashion global the what their for marketing the move ago it's technology lately the back few years

management of just to many years the You're company one force you frankly, and deliver by those cloud. even them bigger sales companies talk quite go the are, globally, what to saw in over marketing how they those your to all because about can't some of guys leave back platforms.We surprised on publishing us are coming

problem.So you literally a have and point we ask companies been we that it's back might is on with force a them is traditional RFP and really right? our than the that's focusing few on great and been really to artificial services databases, sales at really it, a bigger ago be a the win to higher revisiting bigger that has to something clouds, that financial intelligence application might becoming they native been be not data trend and funny at years packages good not be which winning layer, even Now, They might able with the they're the it's publishing, marketing They they're automation. great good lost but and rate deliver been at rate.

Got it.

that's follow-up a And here, Now, helpful. Chris. maybe super for

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just really dynamics I the to wanted there? understand So

happened the really of were On of the was awards XXXX, side, from kind X and on to tied on were areas investors.The focused, of compensation very half compensation-related feedback-specific incentive I are that end-of-year stock-based is grants There first importantly, that the we the from remarks, extensively in taking But more think XXXX. primary prepared much that dilution items some in acting made. we're compensation. down road zooming first out the being to

from swings feedback a beat a now X% reduction than rather tightening tighter to to around X% raise a predictable guidance in going to and approach third We're XXXX bit. over and guiding area. more going to substantial dilution of in X.XX% have and to enroute our was but and second rate these little wild David, And continue then, beats. of to the to up pretty a can X.X% you continue to company, wanting area dilution just time.The be talk be to that So, year-over-year guidance to

today, Wall XX, I difference I But that, case think XX, XX. of Chris. I'll our what think Street. a the Chris to enterprise is should and and expect multiple history, I've that believe don't so with with remembered say on paper hear that, How and actually we're now and we to what studies, studies. is, to client been goal last makes Case and there but do and will writing is how we continue.Our of anybody for case with that clients case forth you The for we it of clients the that's to massive putting more big quarters, is this what enterprise One our agency the you to and would studies give time in a a doing full is cool, are, at we out end so to I more the Slides will we day, only right? doing been stock-based But piece do road that be to So will to spend a you I from a trend what of very forth out, Zeta's think time X% credit lot solution, goal. work simplify point over a answer is thing I right -- what first on not the was couple in know that moving trend will that has continue long case putting studies, investors. we a personally the very help comp. get company.So studies? are are named know X% Koji, X.X% add plus grow we Scott is you're to as begin Chris X.XX% it's around I short question so us traditionally the a continue. confusing as as you to comp gosh, things which to those

making Steve I'm are as be as decision as we is increases more only Steve also they shares units, management team And taking stock is shareholders no Gerber, Vine. that require Chris to make senior price as for sure not we will a to restricted making decisions those year.So they're will do take to our to as with to Because We things a performance And is and aligned this in Greiner, a time. us they get existing the better the do. job know stock being us all we're of want vest, want that shareholders heard. in just to that

is question Genuity. Canaccord with from next DJ Hynes Our

for on is Luke This DJ.

was also the flesh there, across penetration wondering potential then I recognize your on out sort rollout base? bit on on that of your mobile days it's I thoughts intelligent if impact agent you and could opportunity. existing margins any early a customer could And comments So but over how still time? early

clients. to of jump this these that. XXX, ourselves disproportionate which here, reiterate, don't I running products this coming get believe And I does to help talk think they margins. months, it do baked really really, get want is at software they're not are carry am that, adopt products not the I of our traditional today. think, what to and percentage But that gets business XX%. agent into can say about want scaled once the Yes. better And business upside I again, job I that, projections conservative long-term, about to me, what that.We the these do we think intelligence have But I down clients really And extrapolate enterprise We I intelligence. this the is Listen, we to almost to How ahead product intelligent And excited them excited is into core adapt in and road Because begin business. into only we're intelligence their product. the true into to or to products? a first goal quarters, of our years. they're around a too but about

move pretty XXs but sizable if believe can margin you're a move get do we high continue the margin tell to you products We long base in needle bunch going XXs. a don't adopt to we or company, run, product, to So at know margins mid to these adopt perspective. I to about into you're board a a I clients the it's clients talking talking, high believe have coming of they're is, But us that that's from we'll them. are on our And believe will gross going scale. help our What them meaning up.

companies streaming as a the just Do size the on guys. you've to And hear. A probably you rolling CTV any of of we think similar are out? a great increases impacts perspective notionally that That's And have there? lot out tiers follow-up. market that ad opportunity nowadays. your business for you And, seen roll

one accurate, Good question. -- the of the content, for sort massive call beginning of ads, into the these already it's of of the always to plugged totally of I us. them. it's those the content, And Every is the it are of opportunity be middle of but pre all end above. pre-roll, Unequivocally, insert that the units transparent, platforms not streaming more but we all a content, the of

quite we what expand one. out.Now, to largest opportunity get unique planned, unique the these come to the minimums platforms, think trying way we platform with now largest them. to partner it all they the of seeing that started had work scale to of enterprises a didn't opportunities the And So very originally including back. this sort to with least. say streaming business They've as the we're off massive are see of And out

in on CTV. advocacy for and of fourth quarter-to-quarter. CTV's quarter, It year pattern follow if neat actually, Luke, in XX% X shadow political, be And the had XXXX as you We growth the grew well. word quarter, usage would nice a around a

very nowadays. for do usual. obviously, is to I CTV, political. I advocacy me beat to advocacy the reasons. CTV-centric, that political. hyper-targeting, shudder really Chris But linear. not encapsulate mean, business And as the host Very term I of the on it does generally punch call use our a focused all way to

So we see this as a big opportunity, to your point, Luke.

Cummins from Riley is question with B. next Zach Securities. Our

taking assuming congrats decline just one of and more is thanks in ARPU super-scaled some my on insurance, here that's my in first expectations I'm clarifying questions. I strong just most and of year-over-year wanted and a there's and moving for get growth in around with to headwinds for customer that Chris, metric QX. question. a related to XQ, forward? the your but clarity that David Chris, believe auto

now, with this of they those where spend than to spending as that of scaled us, as how spend that that And average, customers, much year good next scaled I X-year is year's the now the tenured customers good next with a at in in over their $X.X got count is of Yes. you X.Xx progression they're million. What's X-year driver. XXXK.If X million. $X customers, No, super-scaled on the kind customers, that XX%. was XXX which I up which annually their around the XX% of with on at is cohort then scaled deck a average to up Xx scaled year-one X update think a There's side, you think to we year-over-year of tier they that demonstrates XX% count customers really more customer quarter-to-quarter, which slide revenue, is go up was associated slide but X revenue basis, the interesting on more scaled go spend revenue will, on than around you in that if progression, the tenure, we've

of platform. a to nice the it's demonstrate stickiness way So the

the insurance about, retention I was XXX% in think at as at exclude part we if But sit will that in just revenue you we As XXX% we be XXXX. year net as today high-end your the talked revenue automotive XXX%. to XXX%. here question, the right range model net said, of retention And as to remarks, XXX% was for of XXX% that our of to prepared we the and

especially follow-up get integrators. most really is, years side, seems in growth on motion the investing over the your you're And just of of But been the question go-to-market opportunities my Understood. to direct it starting has your system X partnership more driven past couple and by that.

curious versus channel maybe investments you're these in into of of how some direct leaning thinking just So about partnership channel the opportunities?

great a partners the other enterprises. Zach. we've with agency It's with added Obviously, directly which sometimes Snowflake, to is the agency, channel, go to AWS. question, channel partnering sometimes in We've added them

SI with going our first integrations, done are them this We second probably quarter. perhaps quarter, X live with early be

partner has this is the to say them us is which currently with you.I environment. but in of what a in think it Scott and to conservative not are are prospects. SI we separate is in include them don't this to So be sort we're seeing projections again, about sound meaningful very do to to doing. year, We're will X to what deep we're table we which SIs do launch me. the meaningful gone with enterprises. and broken sure years like also record, about X don't be integrations enterprises those this excited meaningful like have the very addition us reiterate the we're talking want what with and will in we going and I'm to revenue this not I not to separate about knee we'd which channel for say to We're from to come. with vendors integrators expect excited kick going SI that from But X want systems now, year, could their gone And it to work SI I'll the to Under to if asking don't, saying to

coming in Great. of Best luck the quarter.

with Arjun Our next Bhatia question from Blair. William is

to a layer in are a that you're of differentiator RFPs? going personalization. in yourself. some layer you going a the more of emphasis recent throughout to layer strong compare, just And seems the drive more strong versus and talk about kind customers choose pretty how it guys players? you like RFPs, against you talk can the customers important But like if an to where data is on placing could job data CDP is Nice agencies to relative CDP maybe QX capabilities, or maybe the I here. of certainly deciding your in contrast have up we know, much to other factor When ecosystem, CDP customers when

say the good, I of majority CDP holding they've question, a And as Arjun. that tell as great technology CDP better, relates any sort of corporations, in the than It's rebranded. I that say vast other our not if DMPs it technology will they you that CDPs Listen, HoldCos, have technology would is also to really that large world. the are

Data to that coming that, So when can talk we're hard, or of breathe. these what of lot guys, able Platform. against stand right? it's see they who go companies that that up most the for? see individual. are a at you What up think by or is, look Consumer does product, can perhaps you And standalone the It of customers of does level quite to we our It's It something to sort big your other putting another, mean best CDP we doesn't those which about a when it's is And cohorts. right? of of absolute It means inside sitting doesn't really just not it's mean? you're roll it means we smaller what technology, a either segments. there.So as together record. large a individual building do large mean there. of It's It an guys up, Most can't run you're part

because technology data greater into the data XX% our incremental processing the all language while CDP, the natural append just the seamlessly data RFPs I of than to quality, CDP, to ability our on invited elements, cloud, AI, safe, ability to to know data the data of component your our that it data Is average hard match an to around those those Is sell superior? algorithms hundreds important now And to data of as import and data such one thousands data, an it's data of bifurcate to don't participate Now, the Zeta that us to that What keeping get up there's choose ability to ability we're enterprises simultaneously from things.So product, our superior? winning than of into do greater XX Zeta Is nobody Generative not integrate we in in. why relates it's that show of and while your that how else if the the the from and right, average out their compete engagements the of is we each of there know cloud I importing to. data all superior? can people RFPs. XX% our

reason to a that, on think our can't important.And I us source at the anybody because you final data, not that can't any from at just any just that Like of There's who's to. So really imports -- data final a think of that integrate CDP put extra get it's we world in didn't time from price. the our that sort data don't collective's other bought no I sell footnote any anybody right? to

And data to sense. that as we your us and we're So pretty do we If well, cloud, more your CDP I interconnected. buy that do would think came to happy it's to think client a than like don't to and integrate win said, makes I that. want we'd if to

initiative, point? too this shifting how tell Like, getting Yes, that little more of and XXXX? the indirect, And signs the since on we started shift how a I super they're this you a can the to newer between you is do some you in at may of agencies traction have in helpful. if that is maybe you're again for seeing that bit that's mix of direct, to come that or mix mix have their agency on clear, indicating follow-up early they direct either kind or these shifting are it some sense to they're

Yes.

holding we our you supplemental showed of slide in Chris writing can Slide as on see hit of tell. bottom big of migrating opportunities investor went, I me me XX deck, we've the for that one it XX. to our how Chris Slide early sub-XX% similar pattern. is because is at gross great sort XX%, corps believe grew follow there's think think that going a scaled out, is exact But years. on way margins deck, and We a pointed our started where it one that we those know QX. So, very eloquently to than over large agency X other to the the And they corporations we first migrated with, worked I that in the today, client it again.So greater hold to earlier but down are that right, agency

limited Now, of for sort they what we're to did as stay year overhead. lot the but thing because And take are rule substantially the XX.And other our always caveat on the the operating margin only this be guided that if rapidly, looked our third guys some rapidly. out at, our of Not The really aspired the low margins. mean, that's guys. divisions a than hold in? and rule is, margins care deliver the XX. the It's with and agency in or XX, margin to XXs. goals, growing long-term is very this higher say, gross might I that of I able of I've companies at on even higher incremental operating the new have of guys of than to of seventh those we hose we And you a rule unpopular these run right? in me, to quarter is gross X it's drinking above migrate a row the What are the enough fast growing fire about, was company an I've coming to

higher So, operating most money current of line quarter. margins, percentage EBITDA actual substantially in that drops to at fourth the than even the a the

we we matters they'll to the will. we are yes, going a think margin? And business We believe greater we'll see is, think we are than So, them. believe we than Yes, We grow XX%? to XX% to going come will. migrate But me, greater what we back. operating

we're this think I So in good for year. shape

Capital final Partners. Our with from Baldry question ROTH Richard is

each And of the think in RFP First not in a or heard past average but but number of one not I higher. of Could about to you may buybacks, larger? get down If where just idea question, sure I cash that is generate so offensively going where deployed. would seeing later, I've has ahead this may then, that, I priorities you deploy and have acquisitions, the addressed, so I'm or $XXX head. close of came would number maybe the then out guidance you on a XX smaller, people more are year's even question of, of on some to in free be in you be And to XXXX something debt, have the your my was that wrong, we of midsize, disregard. competition, second flow. then guide aggressive over that's this if free I'm cash pay been you're who million talk be the it sort fading know, around higher, if sort either, But just flow.

no, Rich, even for We on I didn't know you you took vacation. thank know so joining. vacation. you're

down. we're 'XX former the quantify not RFPs. which where ago. just especially not and got, used what is anymore.So a to number couple just past, had lot just about a independent not XX of So I talking standalone around I I flow, would you in to appreciate So tell. it. I seeing seeing cash your We're to is not the X-years, will the to I said million $XXX European the for time talk But else me million combined. the in we're would and joke listening between And $XXX funny around with to make of Yes, free years be anybody say quite have being let tough joining small it Chris a them 'XX seeing have going were big And that now Chris a told next be do a to XX. CDPs, up are point we're us of having larger way some to a players the who frankly, from are game you've And be, they it what showing CDPs used really businesses, as the to solutions invited right? that

did continue is opportunistic the that a from be We've you'll obviously really free increasing million we an think I And that mean job buyback. in up see on at free XXXX, flow think, Investor represents X flow to last were out at be on $XX laying But of the cash Vine the I time on focused you our Day. XX% conversion neat on long-term XX% the very guide in-year continue guidde, but conversion, cash free is end opportunistic we've model, first at M&A this we'll We'll flow. put what out Steve cash years. opportunistic had a to for M&A. David and share know,

$XX continuing just level.I it's If would conversion than working not just agencies headwind, if So think get we cycles we from in for customers. Rich, million the XX%s. about neutral, remarks, in to up have had that XX% headwind have difference capital the it would talked and to payment a that been prepared in their our been interesting, enterprise the

clear of get nice want percentage. with? you'd years close So continuing the we see as path that anything David, a to we through to increase

we that it going and when said we to happen was and that Day, to -- just So to going that. was Investor Yes, right? Analyst about Day, were did we clear happen at knew our point, we

us competitive to And when a hold sheet it facetious, of as this do being do think I unique position call. of we where the collected but yet position cash we so But any paid as also hold able move we little which on by to position can't to scale us large is more some do not is pay companies company. be slower you're the very the deals it balance advantage of competitors puts somebody we've paid. or I a number the to to, in agency balance paid put writing you good that than giving balance partner in have us at collect news agency put this, not XX.XXX% large it it's slow that The another of a companies, us sure with things smaller a do have with sheet us work point. that, way, able say on these sheet, Rich, the shouldn't it off, we're a you're normally I'm all. didn't dollar as ever bit be that you faster you expand do puts and those the in we more I'm into I'm One a of marketplace. more to to but And M&A, where XXX%. understand a even more going very to on is allowed like the buybacks, the revenue.

on Congrats a quarter. great Great.

turn We have reached like the conference back the to Steinberg remarks. end would David over for of closing our question-and-answer session. to I

reality for the management running.And world. have we loop, a a It that Well, last But look next bigger foremost, said, XXx me thank experienced, I different involved really meetings have you us an recently believe of the years. people, company teams said, best have the believe I one organization have organization.First that and could incredible of than the and ever best run you of called do host reasons, I -- had think to doing current you're forward teams I our appreciate very to we to team. current and get in one will XX I've few, our I quickly of constituencies one and X I whole I I it the Zeta closed that is, is, they know as which close the to all funny the because are was you. an built with the was some had trying we in in

and execute. lot continue and us a make you of have follow. next appreciate goal people best us work.I to keep time companies the one there's and really know follow of year a you in can shareholders with places to who I the doing We we analysts I best smart lot incredible and as creating us, or simultaneously the who look can, for the X cutting work us. our the of stuck who deliver our over have on absolute edge job while their really deeply clients, deeply innovationally, appreciate butts off to our on we focusing is also to believed

beating this of everybody have to next, when this our enterprises relationship is has or And the raising. and February, a can much, want and very quarter you whenever, their banked look internally, consecutive our and wonderful I forward to As to quarter say can was like Zeta their December when XXth the day. I platform.Thank say, users and say with hope their people XXth I I and Bye. end Zeta our consecutive of next I who I really customers raising. thank on beating

our Thank for does you. participation. your This conference. conclude Thank you

You may now disconnect.