ZETA

• Company Strategy Evolution: Zeta has transitioned from purely a marketing technology company to an intelligent AI infrastructure platform for enterprises, with marketing as the first (not only) application. The platform combines proprietary owned data cloud, AI, workflow automation, and activation to enable real-time enterprise decision-making. Zeta Business Intelligence (ZBI), a new fourth use case beyond customer marketing, provides predictive real-time business intelligence to drive action, rather than static historical reporting. Key proof-of-concept use cases include helping a major sports/entertainment company negotiate streaming rights and helping an energy drink brand quantify value for retail partners.

• Strategic Partnerships: Four key catalysts are accelerating Zeta's transformation: 1) OpenAI partnership: OpenAI powers the voice/conversational layer of Zeta's Athena AI product, with no large language models accessing Zeta's proprietary customer data; Zeta runs all decisions on its own purpose-built inference models trained since 2017. 2) Deepened partnership with Snowflake: now over 100 shared customers, reinforcing Zeta's role in the enterprise data ecosystem connecting data storage/analysis to action. 3) Palantir partnership: Zeta's data cloud is fully integrated with Palantir Foundry as of July 31, 2026, with multiple initial combined sales already closed and more opportunities in the pipeline. Palantir provides enterprise AI and governance infrastructure, while Zeta contributes customer intelligence, data, identity, and activation capabilities. 4) Athena AI: Launched earlier in 2026, Athena is a fully conversational natural language interface for the Zeta platform that lowers adoption barriers and expands usage. Athena voice users interact with the platform 500% more frequently than non-Athena users. 90% of Zeta's new code was automatically generated by AI in Q2, accelerating product development.

• Customer and Sales Metrics: 83% of customer interactions are now voice-first, aligning with Zeta's natural language interface thesis. Multi-use-case customers grew 90% YoY, customers using 5+ channels grew over 50% YoY, and cross-sell/up-sell deals grew 43% YoY. Total sales pipeline grew over 60% YoY and increased by over $100 million in the past 90 days. Per-seller pipeline creation grew over 100% YoY, average contract value grew over 40% YoY, and overall pipeline deal size grew 25% YoY, while quota-carrying headcount only increased 1% sequentially to 198 (up 11% YoY), demonstrating strong sales productivity gains. AI adoption metrics: 40% of super-scaled customers are already monthly active Athena users 130 days after launch. The 20% of customers that comprehensively adopt Zeta's AI tools account for ~70% of total revenue; among super-scaled customers, the 50% that are comprehensive AI adopters drive 75% of super-scaled revenue. AI adopters have net revenue retention 400 basis points above the company average, and grow 4x faster than non-adopters. Average super-scaled customer relationship tenure now stands at 56 months, up from 48 months a few years ago.

• Operational Results: Zeta achieved its 20th consecutive quarter of beating and raising guidance, and 21st straight quarter of over 20% revenue growth excluding M&A and political revenue. Zeta recorded its highest ever Q2 free cash flow and positive GAAP net income. Restructuring and integration savings from the Marigold acquisition drove expense efficiency: R&D expense ratio improved 30 basis points YoY, G&A improved 180 basis points YoY, and sales & marketing improved 250 basis points YoY. Zeta deployed $29.9 million in Q2 to repurchase 1.6 million shares, and has spent $74.6 million on buybacks year-to-date as of July 30, 2026. Zeta closed a new $1 billion credit facility, providing capital flexibility for M&A, share repurchases, and investment.

• Zeta Global raised the midpoint of full-year 2026 revenue guidance by $33 million to $1.818 billion, representing 39% YoY growth (25% excluding M&A and political candidate revenue).
• The midpoint of Q3 2026 revenue guidance was raised by $10 million to $471 million, representing 40% YoY growth (23% excluding M&A and political revenue). Political revenue guidance is maintained at $7 million for Q3 and $8 million for Q4, consistent with prior projections.
• Full-year 2026 adjusted EBITDA guidance midpoint was raised by $8 million to $405 million, representing 45% YoY growth and a 22.3% margin (90 basis points of YoY expansion). Q3 2026 adjusted EBITDA guidance midpoint was raised $3 million to $115 million.
• Full-year 2026 free cash flow guidance midpoint was raised by $20 million to $255 million, representing 55% YoY growth, a 14% margin, and 63% conversion, tracking ahead of the 2028 65% conversion target.
• Full-year 2026 GAAP EPS guidance midpoint was raised to 10 cents, up from the prior range of 2-4 cents. This guidance excludes a potential material one-time upside from a valuation allowance release that may occur later in 2026.
• All guidance maintains Zeta's standard conservatism, with a 2-5% cushion built in, and minimal expected revenue from new partnerships included. Faster than expected Athena adoption or new partner deal wins could push results to the high end of the range.

Zeta Global does not break out results into distinct product segments in this call. Overall company Q2 2026 results: total revenue was $443 million, up 44% year-over-year (28% excluding M&A). Adjusted EBITDA was $92 million, up 56% year-over-year, with a 20.7% margin (170 basis points expansion year-over-year). Net cash from operating activities was $69 million (up 65% YoY), with free cash flow of $58 million (up 73% YoY, 13.1% margin, 63% conversion rate). GAAP net income was positive $8.2 million, versus a net loss of $12.8 million YoY, with GAAP EPS of $0.03. Key customer segment metrics: super-scaled customers grew 17% YoY to 197, outpacing the 4-8% target growth in the 2028 model, with strength in consumer/retail, telecom, and healthcare. Super-scaled quarterly ARPU grew 17% YoY to $1.8 million, outpacing the 12-16% long-term target. 8 of Zeta's top 10 industries grew over 20% YoY on a trailing 12-month basis, with consumer/retail, financial services, automotive, and healthcare accelerating from last quarter. Double-digit revenue growth was recorded across email, CTV, and social channels, and across all three core marketing use cases (acquire, grow, retain).

The call does not explicitly discuss material current operational failures or new substantive risks beyond the general risk disclosures included in SEC filings referenced in the opening remarks. Management has already completed the migration of Zeta's data cloud to Palantir Foundry with no reported disruptions, and notes that the transition was seamless for customers.

Q: OneZeta has driven 90% YoY growth in multi-use-case customers. How will this trend continue, and how does ZBI cross-selling work with existing customers?

A: OneZeta and Marigold cross-selling have significant remaining runway, as ARPU growth has consistently outpaced long-term targets, and Athena acts as a powerful catalyst for cross-selling additional use cases and channels. For ZBI, customers are already pulling Zeta into new use cases, rather than Zeta having to push sales: customers want predictive real-time decisioning rather than static legacy BI, with use cases across contract negotiation, marketing investment, and retail partnerships. Supplemental slides in the earnings deck detail dozens of active ZBI use cases across multiple verticals.

Q: How do the new partnerships with OpenAI, Palantir, and Snowflake impact go-to-market, and how large can adjacent non-marketing use cases become?

A: These partnerships have been game-changing for go-to-market: Palantir's strong enterprise brand has given Zeta immediate access to top global advertisers, with two initial deals closed from two opportunities, and many more in the pipeline. The partnerships generate more customer outreach and new at-bats than ever before, accelerating super-scaled customer growth. New non-marketing use cases are driven by direct customer requests, and 90% automated code generation allows Zeta to turn customer requests into product features in hours or days, rather than months or years, creating a fast-growing flywheel for new adjacencies.

Q: ZBI is a large new category. How will Zeta productize and sequence new use cases for this line?

A: Zeta is building ZBI use cases vertically by industry, leveraging existing sales team industry expertise across 15 core verticals. Top initial use cases are in retail, including product assortment, shelf space optimization, and deeper customer relationships. Every new customer request is immediately productized, enabled by 90% AI-generated new code, creating a continuous flywheel where ZBI grows as customers add new requests, making it Zeta's fastest growing use case currently.

Q: The Palantir integration is complete, with initial deals closed. What does the pipeline look like for Palantir partnership deals, and how does Zeta approach capital deployment with the new credit facility?

A: The Palantir partnership opportunity is larger than any prior partnership in Zeta's history, with enough high-value potential deals to significantly move the needle if all close, so management is holding these deals off current guidance to maintain conservatism. For capital deployment, Zeta will continue to focus on small to mid-sized M&A that adds talent, data, products, and customers, avoiding large transformative deals that hurt both parties. The new credit facility gives flexibility to accelerate share repurchases in the short term, as management believes Zeta stock is the best investment for free cash flow at current prices.

Q: Why is Zeta seeing faster AI adoption than many other software companies? What is the opportunity for Athena for agencies?

A: The key differentiator is fast, measurable return on investment: Zeta's marketing use cases deliver 600-700% return on ad spend day one, compared to many AI tools that take years to generate ROI. For Athena for agencies, management originally expected mid-sized agencies to adopt first, but large global agencies are adopting at scale faster than expected, as Athena lets them demonstrate Zeta's data cloud and higher ROI to their clients, with one large client already seeing 1400% return on marketing spend after adopting Athena via an agency partner.