LegalZoom Surges 12% on ChatGPT Partnership Amid Stable Revenue Growth and Operational Efficiency

LegalZoom (LZ) stock surged 12% to $9.80 after announcing a partnership with ChatGPT to enhance its legal services through AI capabilities. The company's financial health shows steady revenue growth, a low debt-to-equity ratio, but a warning sign with an Altman Z-Score of 1.35. Business performance is characterized by consistent revenue trends and operational efficiency, with an EBITDA margin of 12.45%. Valuation metrics indicate a premium valuation compared to historical medians, with a P/E ratio of 51.65.

LegalZoom.com, Inc. (NASDAQ: LZ) stock surged 12% to $9.80 on Tuesday following the announcement of a collaboration with OpenAI to integrate its legal resources into ChatGPT’s agent capabilities [1]. The online legal services platform revealed that its products are being leveraged to provide legal guidance within OpenAI’s newest ChatGPT agent release. This integration allows ChatGPT to access LegalZoom’s legal resources through advanced AI capabilities, delivering high-quality legal information to users.

The collaboration enables users to analyze business formation options across multiple states and receive tailored recommendations based on thorough analysis. The system can intelligently navigate legal resources, run analysis, and deliver editable documents and spreadsheets. LegalZoom emphasized that its network of attorneys will remain available to offer further guidance for business and personal legal needs, complementing the AI-powered service [1].

The company's financial health shows steady revenue growth, a low debt-to-equity ratio, but a warning sign with an Altman Z-Score of 1.35 [2]. Business performance is characterized by consistent revenue trends and operational efficiency, with an EBITDA margin of 12.45% [2]. Valuation metrics indicate a premium valuation compared to historical medians, with a P/E ratio of 51.65 [2].

LegalZoom is set to announce its second quarter 2025 financial results on Thursday, August 7, 2025, after the close of market [3]. The company expects to report its financial results for the second quarter ended June 30, 2025, and will host a conference call and webcast at 4:30 p.m. ET the same day to discuss the results [3].

References:
[1] https://www.investing.com/news/stock-market-news/legalzoom-stock-soars-after-announcing-openai-chatgpt-collaboration-93CH-4170370
[2] https://uk.finance.yahoo.com/quote/LZ/news/
[3] https://seekingalpha.com/news/4479371-crexendo-aims-for-double-digit-revenue-growth-and-targets-7m-software-users-while-expanding