Zoom Info Results

ZoomInfo reported another spectacular quarter:
It’s revenue of $153 million, was up 50%, and up 12% sequentially adjusted for the number of days in the quarter
Adj Op Income of $66 million, was 43% of revenue.
Operating Cash Flow of $93 million or 61% of revenue. Yes, you read that right, 61% of revenue!!! Operating cash flow that was 61% of revenue.
Adj Free Cash Flow of $97.5 million was 63% of revenue!!! It was 148% of that huge Adj Operating Income.

Deferred revenue was up $39 million compared to $14 million the prior year. Bert says that that indicates that calculated billings were up 66% yoy

New and Expansion Logo Customers:

Last quarter they listed Okta, SAP, Toyota, and Marathon Oil.

This quarter they listed Zoom, Docusign, Shopify, Uber, Forbes, and AmazonBusiness (part of Amazon). What a list of customers!!!

Business and Operating Highlights:

The ZoomInfo platform has been named a Leader by The Forrester Wave: B2B Marketing Data Providers, Q2 2021. The report evaluated 11 providers based on 24 criteria across three categories: current offering, strategy, and market presence. ZoomInfo received the highest possible scores in 18 criteria, such as data acquisition and processing; data security and privacy; integrations, APIs, and applications; sales support; go-to-market (within the strategy category); solution packaging and pricing; and product roadmap and vision.

Significantly expanded the integration points between their Engage and ZoomInfo platforms, enhancing the ability to search and import contacts from ZoomInfo and Salesforce into Engage for improved efficiency, and configuring target market personas to receive recommended contacts to target.
Earned the TrustRadius top-rated award for sales intelligence software for the fourth consecutive year.

ZoomInfo has more than 800 verified ratings and reviews on TrustRadius and is also a certified recipient of the 2021 TrustRadius TRUE Badge, recognizing vendors who are Transparent, Responsive, Unbiased and Ethical in sourcing and managing their consumer reviews.

Attained 2021 TrustArc GDPR and CCPA Practices Validations, confirming ZoomInfo’s status as a privacy-forward organization. The GDPR and CCPA Practices Validations confirm that ZoomInfo’s privacy policies and practices meet or exceed the TrustArc Privacy and Data Governance Frameworks, including: establishing, maintaining, and continually improving GDPR- and CCPA-compliant privacy practices aligned with the ISO 27001 International Standard for Information Security Management Systems.

Successfully lowered interest expense by paying back part of their debt, refinancing the rest at a lower rate, and taking out an unsecured loan and credit line…

More than 950 customers with $100,000 or greater in annual contract value (was 850 last report).
Had an eight figure contract this quarter (That’s $10,000,000 or more, just count the zeros!)

I suggest reading the Conference Call transcript for more information. The analysts, by the way, were throwing compliments and were asking in wonderment how they did it.



It was an exceptional set of results. Having recently sold all of my Pinterest shares and redeployed half into Zoominfo, I am convinced it was the right move after this call. I just could not find anything not to like. Here are my excerpts, a summary of the historical numbers and some thoughts (I did not summarise the full Q&A), which as Saul said was even more exceptional and worth a read.

PR: https://ir.zoominfo.com/news-releases/news-release-details/z…
Prezzo: https://ir.zoominfo.com/static-files/c874fe43-fcc7-4f3f-ab62…
Webcast: https://ir.zoominfo.com/events/event-details/zoominfo-first-…


Sales execution:

The first quarter was marked by strong accelerating growth across all of our business lines.

WSM: This is how the CEO chooses to OPEN the call. That, on its own sends a clear message to me.

our long-term opportunity is even bigger than what we had first envisioned.

We doubled the number of new customers added this quarter compared to Q1 2020. We also had record renewals and upsells as a percentage of beginning ACV for our first quarter as we saw demand for our products continue to accelerate with companies looking to drive a digital data-driven go-to-market motion.

What it is they do:

Our platform starts with our market leading and highly accurate data layer, delivers critical sales insights and signals, automates best actions with our next generation workflow software and our tightly integrated activation layer, Engage. This integrated suite of data and software helps businesses of all sizes and across all industries activate targeted opportunities in an efficient, scalable and repeatable way.

Increasingly, our platform is becoming the strategic imperative for large organizations looking to transform their CRM from a system of record to a system of insights

International growth:

during the quarter, we added more resources to capitalize on the growing international opportunity, where we saw new customers join us from Dubai, Sydney, Vienna, Rio de Janeiro, Helsinki and Berlin to name a few. March was our strongest month ever in our international segment, with increasing win rates and demand across Europe and accelerating traction in the UK, Ireland, Australia, New Zealand and Canada.

International revenue grew 14% on a day’s adjusted sequential quarter basis.

Salesforce partnership:

Our investment to deepen our integration with Salesforce is paying off with rapidly increasing adoption of our new Salesforce sync capability. This capability allows users to marry first party Salesforce data directly into ZoomInfo filters, from account data to lead and contact data and now opportunity data. We saw more than eight fold increase in the number of accounts that have enabled this bi-directional sync.


Engage ACV doubled compared to Q4, 2020 [WSM: that’s a double sequentially!] and we’re seeing a 25% increase in user adoption of the core ZoomInfo platform when customers combine the use of ZoomInfo and Engage. We also see the benefits of this adoption within our retention and renewal numbers, where customers who are dual users of Engage and ZoomInfo have materially higher renewal and retention rates than those who are ZoomInfo only customers. This is one of the most exciting things about the Engage platform.

WSM → In the Q&A he does say that this is off a very low base still, though


Including our B2B intent data, which gets them closer to end market buyers by building automated workflows around intense spikes [ph] of topics relevant to their products and services. These data-driven motions have fuelled a significant increase across our Intent products, with Intent ACV doubling year-over-year.

Inbox AI:

Inbox AI product which automates the creation and enrichment of contact lead and activity data from a seller’s inbox directly into CRM, tripled year-over-year.


overall platform engagement perspective, we saw 12% sequential increases in monthly and daily active user adoption.


Over the last 12 months, we grew our team by nearly 50%.

WSM: → This looks like tremendous acceleration to me:

- New customer growth: doubled yoy
- Upsell: record as % of opening ACV
- International growth: international grew 14% qoq (69% annualised), and within the Q the month of March was the best ever.
- Product adoption: Salesforce sync - 8x increase, Engage ACV up 100% qoq!!, Intent ACV doubling yoy.
- Engagement: 12% sequential increase (57% yoy) in MaU and DaU.


we achieved our best ever Q1 results for new business, new customer additions and retention activity.

During the first quarter, we continued to see strong new customer additions and positive momentum with respect to retention and upsell activity.

We had strong enterprise renewals and our enterprise upsell motion is really hitting its stride. In the quarter we doubled the number of greater than $100,000 ACV customers added as compared to the year ago period.

With international revenue growing faster than the overall business, we now have over 10% of our revenue coming from international markets.

We delivered 12% days adjusted sequential revenue growth in the first quarter, strong results relative to our expectations and great momentum for the remainder of the year.

As I indicated on our last call we repaid part of our term loan and repriced the remainder while issuing a new senior unsecured bond in the first quarter, contributing to the $34 million in cash use for financing activities. We expect those transactions will reduce our cash interest expense by approximately $3 million in 2021.


We expect GAAP revenue in the range of $161 million to $163 million and adjusted operating income in the range of $68 million to $70 million.

WSM → So guiding for 6% qoq / 46% yoy


Question from Brent Bracelin, Piper Sandler:

Good afternoon. Henry, I wanted to follow-up on a common thread that’s being asked here. Just around the amazing strength of the business. I vividly recall a conversation with an investor just nine months ago, where we had this heated debate around whether or not you could sustain 30% in 2021. Q1 marks the third straight quarter of accelerating growth 48.5% to the highest in more than two years.
My question here, what’s changed over the last six to nine months where the expected growth rate of your business would improve from what 27% consensus us to now 41% that is a material change last time I checked it, and we’re still on a global pandemic. So it feels like a lot of small things seem to be working. Maybe it’s just the power of the platform that’s resonating. I don’t know. But any additional colors you can give us here because the magnitude of the pace of change in the growth rate certainly seems much, much stronger than anyone’s thinking just nine months ago?

WSM → ‘nuf said. As Saul said, read the whole thing, but this was exceptional for me. This is a QUESTION from an analyst! The CEO goes on to say it’s not just one thing but a lot of things across the whole business fuelled by their culture of constant improvement which is driving the growth.



**Rev	Q1	Q2	Q3	Q4**
2019	73.1	79.4	87.5	96.1
2020	103.6	111.2	123.6	139.7
2021	153.3	162		

2019		9%	10%	10%
2020	8%	7%	11%	13%
2021	10%	6%		

2020	42%	40%	41%	45%
2021	48%	46%		

WSM → Q2 is guidance so not the actual number; they’ve beaten 100% of the times in the past, so pretty confident they will end >50% yoy in Q2. Note a couple fo things: the seasonality in the business, with the first half being relatively slower growth than second half and the 10% QoQ for Q1, which is 2%pts higher than last year. And the accelerating YoY revenue growth trend.


**RPO	Q1	Q2	Q3	Q4**
2019		257.1	277.5	340.7
2020	376.4	413.5	457.6	559.0
2021	591.6			

2020		61%	65%	64%
2021	57%			

WSM → The CFO cautions that this metric is a bit messy, so probably not good to focus on one Q only, but rather on the trend. So looking at that - note the (on average) higher RPO growth rate than the Revenue growth rate, which bodes very well for future revenue generation


**FCF%	Q1	Q2	Q3	Q4**
2019	42%	49%	54%	43%
2020	53%	47%	47%	55%
2021	64%			

WSM → Just look at that improving FCF trend! And improving off an already exceptionally high baseline. Amazing. And not something that all CEOs give equal attention to (Cloudflare for example does not - arguably - pay enough attention to this part of the business) - he mentions specifically that they worked on improving collections.


**GP%	Q1	Q2	Q3	Q4**
2019		88%	88%	88%
2020	87%	89%	88%	88%
2021	89%			

**OpM%	Q1	Q2	Q3	Q4**
2019	50%	52%	54%	49%
2020	47%	49%	47%	45%
2021	43%			

WSM → Gross margins are solid as a rock at close to 90% for two years now. And Operating margins are trending down a bit but still very high, and this is by design as they invest for growth. I can’t see anything wrong here and my conviction in the company is certainly growing.


If this company is such a unicorn, does anyone have theories as to why the market has not shown it any love? It IPO’ed in 2020 where IPOs with much less stellar numbers were skyrocketing while this stock has been effectively flat. Even though I am able to ignore the market when I have confidence in a company, since I haven’t looked into this company enough, the lack of price movement makes me wonder what is being missed.


@junomean2: Look at Snowflake and nCino, two other software companies with incredible growth but both are flat or negative since IPO last summer. They need time to grow into the valuation, IPO market was overheated last year.


Hi Junomean2,
I’ve been wondering the same…
If this company is such a unicorn, does anyone have theories as to why the market has not shown it any love?

ZoomInfo (and UpStart) force me to question how is Profitability, specifically free cash flow, gathered at such incredible amounts? Is it possible we’re seeing an entirely new business model?
Am I misunderstanding the moat of such a business model? Or, is it possible that what ZoomInfo and Upstart provide to their customers is what Gordon Ritter was talking about January this year, when he predicted that ten years out SaaS companies utilizing AI would be solving large pain points and growing their companies far more profitably and growing Revenues faster than any were seeing now?

It’s a long interview; but, I posted it to this board some months ago, without any traction, calling out Asana as an example after looking at their 5year roadmap. Perhaps the biggest reason he post didn’t get traction here was the reason I got out of Asana. I got out due to their relatively poor bottom line numbers.
I don’t know how else to explain these otherworldly bottom line numbers pumped out by ZoomInfo and Upstart🤔. Maybe the market is as puzzled as I am?

Anyone got any ideas?



1 Like

If this company is such a unicorn, does anyone have theories as to why the market has not shown it any love?

I think that when it first IPOed there was a gross misunderstanding among the investing public about what this company does. We saw it on our board when I first wrote it up and people were saying “Oh I hate all those ad calls that come in at meal time” which showed no understanding at all of what the company is about.

Fortunately, their customers, like Zoom, Okta, SAP, Shopify, Docusign, AmazonBusiness, etc understand very well what they do. And, we, as investors, can follow the extraordinary numbers that they are putting up.



Why cant the answer just be that the valuation is expensive?

The market did/is showing it love, as evidenved by their 40+ P/S.

Not every company deserves to immediately double or have 9 or 10 figure market caps.



Thanks to Saul and others sharing his analysis and insight, I have better appreciation of this company.

With some exposure to broad sales and marketing, it is clear to me that ZI product offering is high value to enterprise sales organization…

On the balance, the valuation is already high even with high growth rate… not sure if I want to reduce my CRWD, DDOG, ROKU, SNOW, NARI or PINS for that matter to buy into ZI.

And on FCF just one look at the cash flow statement shows half of this quarter’s FCF comes from deferred tax payment… it is ok, and normal, just that I would not be highlighting it as 63% FCF as half of this money is due to government sometime soon…

Even at 30%+ FCF, it is still incredible business and shows their success and moat…

For me, with current valuation, and environment I may stay on sideline for little while…


Thanks Nilvest for pointing out the tax ramification to FCF, I would have not otherwise believed there would be that much impact.

You pointed to valuation when stating why you are waiting to get into ZoomInfo and I presume Upstart for the same reason.

I’m sure we can agree that both ZoomInfo and UpStart are both AI driven industry specific Saas companies.
It took two years and a Pandemic for investors to catch up to the value of the current Saas model (20 years if you go back to when Salesforce went public). I don’t know how long it will take for investors to see the value in companies like ZoomInfo and Upstart.
I’ll do my best to explain; but, here again is the link for a better explanation https://youtu.be/nRl7d_WM4Bc (It’s a 70 minute interview).

This new industry focused SaaS model takes advantage of the, IMO, greatest benefit of the Cloud, multi-tenancy. Multi-tenancy is a discriptor of when, by the nature of sharing a Cloud environment, every customer benefits from the best practices of the most successful in this cohort. Customers get software updates that are influenced by the best practices of the most successful customers.

The benefits of multi-tenancy are more pronounced within an industry vertical. Now within an industry, because of AI and the focus here, context can be added disrupting the business model of McKinsey (McKinsey ‘insights’ may not be comparable to what future AI models from these industry specific Saas providers might provide). With this focused approach, this vertical cloud will provide turn-key solutions for situation specific problems in near real time. This is the value add from these new Industry specific SaaS companies. Will the share prices reflect this greater value? We will see.

Despite not knowing when the Market will increase the share price of these industry specific SaaS companies, I see their having added value relatively, when compared to those Saas companies operating in the horizontal cloud.

Pinterest, and programmatic ad tech in general, are a type of industry specific AI enabled company. I just don’t see them adding RPO nor having as valuable a type of Annual recurring revenue. The guide for decreased growth in MAUs was just the reason I needed to move the money into these industry specific AI enabled Saas companies, ZoomInfo and Upstart.




The benefits of multi-tenancy are more pronounced within an industry vertical. Now within an industry, because of AI and the focus here, context can be added disrupting the business model of McKinsey (McKinsey ‘insights’ may not be comparable to what future AI models from these industry specific Saas providers might provide). With this focused approach, this vertical cloud will provide turn-key solutions for situation specific problems in near real time. This is the value add from these new Industry specific SaaS companies. Will the share prices reflect this greater value? We will see.

IMHO what is referred to here as “multi-tenancy” is a reflection within specific verticals of a larger phenomenon involving AI/ML. That is to say there is increasing recognition of a feature of cloud services which generates a major value added to SaaS generally. Namely that it is possible to use cloud architecture to create an added advantage for the customer by
invoking AI/ML services.

For instance Crowdstrike makes any new security information anywhere among its customers available to all and uses AI to deepen their security capabilities.

Cloudflare recently signed on with NVDIA for the purpose of giving NET customers access to AI
“at the edge” Many observers believe this constitutes a new and powerful component of NET product offerings, rendering them much more valuable to users.

SNOW is another example. Just read any of their business promotion literature and you will get a flavor of the AI capabilities in their data management offerings.

ZI and Upstart are offering this kind of service to their respective verticals. IMHO this represents a new dimension of service and is what is prompting their revenue growth and retention rates.

If I may quote WillO 2028 “we will see”



ps If I may venture a guess I’d say 28 represents a retirement date


I hope this isn’t off topic but I’ve been going through the ZI results and all of your great posts in this thread. Their results were very strong as Saul outlined and I’m wondering if anyone sees a reason why they are down over 5.5% today when almost every other name we talk about on the board here is in the green today?

The story hasn’t changed it just looks even more compelling. Seems like many people are still sleeping on this company and it’s not on their radar yet.

I know there isn’t often a clear reason or could just be some analyst commentary but some of you are much more familiar with ZI and wonder if you have any insights?



I’m wondering if anyone sees a reason why ZoomInfo is down over 5.5% today when almost every other name we talk about on the board here is in the green today?

Hi Miklo, there aren’t any reasons for one day moves in individual stocks like this, especially smallish companies. Look back to the day before when Cloudflare dropped 12.6%, Datadog dropped 9.3%, Upstart dropped 6.3%, etc, and ZoomInfo dropped only 2.0%. That was just the day before the day you were referring to. You could have asked why did Cloudflare drop almost 13% while ZoomInfo dropped only 2%.

And this is indeed OT so let’s not start a thread on it.



Appreciate the reply Saul and thank you for your teachings and wisdom.

To provide a quick perspective on zoom info the reason I hesitated to enter a position was because I saw the company as having too many competitors providing sales intelligence and contact information like LinkedIn sales navigator as one example.

However that was based on my experience of small business, what I wasn’t seeing was the clear value, time savings and productivity and effectiveness improvements that zoom info provides to large organizations that are willing to invest more money into a more complete service and platform …which I now see as zoom info being the leader in this area.

Many of you have shared your insights into this company and their results and track record of winning very well known and respected large organizations as clients has fueled my interest and small but growing position in this company.

I always appreciate the value and insights and ideas that this board brings and certainly did not want my post to go off topic so I hope this perspective ads some semblance of value.