Marketing technology company Zeta Global (NYSE: ZETA) reported Q1 CY2026 results exceeding the market’s revenue expectations, with sales up 49.9% year on year to $396.3 million. Guidance for next quarter’s revenue was better than expected at $420.5 million at the midpoint, 0.8% above analysts’ estimates. Its GAAP loss of $0.05 per share was $0.01 above analysts’ consensus estimates.

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StockStory’s Take

Zeta Global’s first quarter results were positively received by the market, reflecting strong enterprise adoption of its AI-powered Athena platform and broad-based customer expansion. Management attributed the quarter’s outperformance to rapid uptake of Athena among large enterprise clients, consolidation of multiple vendors onto Zeta’s unified platform, and deeper customer engagement, particularly in retail and advertising verticals. CEO David Steinberg highlighted the early impact of Athena, noting, “Athena by Zeta is an accelerant...bringing AI directly into marketing workflows and removing barriers to enterprise-wide adoption.”

Looking ahead, management’s guidance is underpinned by continued momentum in Athena adoption, growing cross-sell opportunities from the Marigold integration, and a robust sales pipeline in key discretionary sectors. The company expects Athena’s expanding use cases and increased automation to drive margin improvement and accelerate wallet share gains among existing customers. CFO Christopher Greiner pointed to “substantially higher growth to profits and cash flow than we are even to revenue,” citing Athena’s efficiency and the company’s ownership of core AI infrastructure as differentiators that support their improved outlook.

Key Insights from Management’s Remarks

Management highlighted that Q1 performance was driven by new customer wins, rapid expansion among super-scaled enterprise clients, and increased use of the Athena AI platform.

• Athena platform adoption: The rollout of Athena to all enterprise clients drove a 7x increase in AI-powered interactions within the first week, with 60% of platform AI usage attributable to Athena. Management described Athena as a key enabler for customers to consolidate marketing tools and achieve measurable ROI improvements.

• Enterprise customer consolidation: Zeta secured a notable win with a global apparel retailer, which consolidated four vendors into a single Zeta contract. Management emphasized that these consolidation deals are becoming more common as clients seek to simplify their marketing operations and benefit from integrated data and AI.

• Multi-use case expansion: The number of super-scaled customers using more than one use case increased by over 50% year-over-year. Management cited this expansion as a central driver of ARPU (average revenue per user) growth, with ARPU up 21% year-over-year among these large clients.

• Marigold integration progress: Cross-sell traction from the Marigold acquisition was stronger than anticipated, aided by full integration of Zeta’s data cloud. Management noted early signs of reduced churn and new upsell opportunities, particularly as Marigold’s loyalty products are bundled with Zeta’s marketing solutions.

• Agency and vertical momentum: Zeta expanded relationships with both independent agencies and major holding companies, with agency-driven deals starting in social channels and expanding into other digital channels. Nine out of ten top industry verticals grew revenue over 20% year-over-year, with discretionary sectors leading.

Drivers of Future Performance

Zeta’s outlook for the next quarter and year is shaped by Athena’s expanding adoption, ongoing Marigold integration, and a growing pipeline of enterprise and agency contracts.

• Athena’s impact on growth: Management believes increased automation and AI-driven workflows from Athena will accelerate wallet share capture and deepen customer engagement, particularly as new use cases are adopted across large enterprises. Early data shows Athena enables clients to reduce marketing labor by up to 70% and unlock more value from Zeta’s platform.

• Cross-sell and integration synergies: The Marigold integration is expected to drive incremental revenue through cross-selling of loyalty and data cloud products, with management highlighting reduced churn and new bundled deals as sources of upside. Further integration is anticipated to improve margins through operating synergies and expanded recurring revenue.

• Pipeline strength in key sectors: A 40% year-over-year increase in sales pipeline, especially in discretionary verticals like retail and hospitality, suggests sustained demand even amid macro uncertainty. Management cautions that deal cycles remain consistent, but larger contract values and increased at-bats signal continued market share gains.

Catalysts in Upcoming Quarters

In coming quarters, the StockStory team will be closely monitoring (1) the pace of Athena adoption and certification among enterprise clients, (2) measurable improvements in ARPU and multi-use case expansion, and (3) execution of cross-sell opportunities stemming from the Marigold integration. Progress toward higher recurring revenue mix and operating margin improvement will also be critical indicators of Zeta’s strategic execution.

Zeta Global currently trades at $18.97, up from $18.50 just before the earnings. In the wake of this quarter, is it a buy or sell? Find out in our full research report (it’s free).

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