Cloud marketing company Zeta Global announced a 24 percent increase in revenue for a strong Q1 earnings report. CEO David A. Steinberg joined Cheddar News to talk about the company's latest and dealing with inflation. "Were really focused on cash flow and making sure that we can deliver that," he said.

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Zeta Global Has Strong Q1, Outperforms Nasdaq Tech Sector

for more on the company's results. David Steinberg Ceo of Zeta Global joins us now. David just break down some of the biggest highlights from data's first quarter results and some of the strongest points, at least in your eyes. Well, first of all, thank you for having me. It's it was for us a stellar quarter. We grew top line 24.5%. We grew Ebitda by 44 And we grew free cash flow by 277%. So we're really focused on cash flow and making sure that we can deliver that. And what we're really seeing from an overlying perspective is as inflation is proliferated and as markets I'm sure you've noticed have gotten tougher. What's happening is Organisations are looking for higher levels of efficiency and marketing. And at Zeta we've been able to deliver a 10-1 return For everything that customers spend on our platform. So for every dollar they spend on our platform, we've been able to return them $10 in revenue by using our data and our software up to your point, there's data is actually outperforming the broader NASDAQ that tech sector selloff that we have seen. Can you just talk a little bit more in terms of how Zeta is managing to outperform and get that added value proposition kind of cut down on the bottom line while maintaining growth on the top line. Well listen, I think if you build a great company, your stock price follows even in very choppy markets. And what we've really done is we've focused on, you know, wrapping our arms around our customers providing the best possible software and data we can for efficiency and efficacy. So the other sort of macro trend going on is a lot of the very large technology platforms are sort of battling it out over tracking mechanisms, whether it's the elimination of apples I. D. F. A. Or the elimination of google's third party cookie. We've never used those methodologies for measurement or management. So we've got our own unique identity called this A. I. D. Obviously aptly named and we really focus on helping clients to understand how to get much better returns on investment. And in this tough market we're seeing our clients scale faster, use more of our technology and our data to grow. As we noted a moment ago that sl revenue jumped 24%, pretty decent and pretty substantial. Especially kind of in this current market environment and even in the sector, the space environment that you're in. Um can you just talk a little bit more in terms of how you pulled that off and how you expect to kinda sustain this rapid revenue growth again amid current market environment conditions. Yeah, I mean as as I think I mentioned earlier, I think that's a great question in a downturn. Our platform becomes even more necessary to our clients because they're looking to figure out how to take their brands and their products in a consumer environment where, you know, there's less expendable income, right? So you've got, you know, higher energy costs, higher food costs, higher housing costs. Our clients are looking to make their products get their products into the hands of clients who are actively looking for them in that moment and that is exactly what we are built to do from a bespoke basis. So we believe our growth is gonna continue. We increased our guidance for the second quarter pretty handedly and we were we increased our guidance for the year pretty handedly and the first four quarters that we've been a public company, we have beaten our top of our range nicely, both top line and bottom line. We believe that free cash flow is a metric that's going to be more and more important in the down environment. Uh You know, we've got mid teens operating margins today and we believe that sustainable or or we can grow from there. We saw our gross margins go up 600 basis points year over year to, you know, we're just, the business is really working and in the downturn it's fired. I'm sorry. No, no. So I'm curious now because the numbers are pretty impressive. I have to say walk me through exactly what you guys do. Obviously, we know you're a data driven marketing tool, but what do you do with the client exactly? To the point where we're able to kind of maximize the value proposition for their marketing kind of, you know campaigns. So I would just say, first of all data in this environment is Power and Zeta through our data cloud Which has, you know, 20 different assets that we've purchased or built over the years too. Get consumers to use our platform has 235 million opted in Americans who have said we have permission to market to that. We then look at everything they're doing from a behavioral perspective, a transaction perspective, a number of different attributes are imported and are artificial intelligence figures out, what do they intend to do next? Do they intend to buy any product that they wanted to credit cards? Are they in shopping for a new home or are they going to turn off the wireless platform or leave one of their existing vendors. Our platform then builds an automated curriculum of contact to get our clients products in front of people as they're making the buying decisions. So you're literally able to take out The 90% of individuals who are not actively in market four products that our clients are selling in that moment. Now they might be in market next month, they might be in the market the month after. But you know, it's sort of the old joke that the average marketer, you know, knows that half their marketing spend his waist, They just don't know which half We're trying to get down to the 3-5% of people who are very actively in market for our clients products, it just allows you to remove all of that other marketing then, once we figure out, sorry, you know, you mentioned this kind of Ai system and technology that helps you kind of add this value proposition to the customers that is really unique to Zeta. I am just curious is that proprietary, Is that something that unique to data that others can't achieve in this space? Because competition, there are names like oracle and adobe and I know that data has outlined goals by 2025 to overtake of these pretty big names here. How do you plan to achieve this? And again back to that original question is that something that that data, that ai kind of tech, you have so unique to your company that others cannot kind of, you know, duplicate it, so to speak. So as I like to say, we have a few small competitors, right? Salesforce, oracle adobe. I want to be clear. We said we're going to overtake their marketing clowns, not their companies. We don't really compete with their core products. In fact, we integrate into all three of the core products of those companies. Each one of them is built a marketing cloud, which we feel that we have a massive competitive advantage over. And the answer is all of our artificial intelligence is proprietary. We built it internally. We have a sizable patent portfolio around artificial intelligence. Machine learning and deep learning and we believe that owning data for data's sake is a waste. It's how do you make data actionable? So back to what I was saying before now that our artificial intelligence has figured out that this individual who identifies as data I. D. Number 135782 is actively in market for a new credit card and has a high propensity to be credit approved. Our system activates to that individual whether it's through messaging, whether it's through social media, whether it's through programmatic or our fastest growing business which is C. T. V. Or addressable Tv. Which we publicly said grew another 200% in the first quarter. So back to how are we bucking the trend as marketers are moving from linear television to addressable television. Our platform is uniquely able to identify and target individuals using the side I. D. Number in addressable television which is substantially lower cost than linear Tv. But you're seeing the same person. David's such fascinating kind of insight here. Thank you so much for coming back, come back again. I mean we want to continue to see the progress of this company. There is some interesting stuff happening especially amid current market environment. David Steinberg Ceo of Zeta Global