Zeta Global's Q1 2025: Contradictory Signals on Macroeconomic Impact, AI Adoption, and Revenue Growth

Macro economic uncertainty and business impact, AI Agent Studio adoption and revenue impact, LiveIntent integration and impact on ARPU are the key contradictions discussed in Zeta Global's latest 2025Q1 earnings call.



Revenue and Customer Growth:
- Zeta Global reported revenue of $264 million for Q1 2025, up 36% year-over-year, and an increase in scaled customer count to 548, up 19% year-over-year.
- The growth was driven by strong customer retention rates and increased spending from existing customers, emphasizing the value of the company's performance-based outcomes.

AI Agent Studio Adoption:
- The launch of AI Agent Studio led to significant revenue increases from customers adopting the technology, with an increase in revenue for adopters exceeding 40% year-over-year.
- This was attributed to the streamlining of marketing tasks and improved efficiency through complex, automated workflows.

Agency Business Expansion:
- Zeta platformed two independent agencies and finalized agreements with two more, contributing to a 19% year-over-year increase in scaled customer count.
- The expansion with independent agencies was influenced by the platform's ability to enhance agencies' profitability and provide data-driven attribution capabilities.

Cost Management and Cash Flow Improvement:
- The company achieved a 60% conversion of adjusted EBITDA to free cash flow, up from 45% in Q4 2024.
- This was due to better leverage in operating expenses, reduced dilution, and improved capital efficiency, enabling strong share repurchase programs.