New York, May 12, 2026, 15:03 (EDT)
- ZoomInfo Technologies, now using the ticker GTM after dropping ZI, tumbled roughly 35% in afternoon action. Investors dumped shares in response to a sharp reduction in 2026 growth forecasts.
- Shares slid despite Q1 revenue ticking up 1.5% to $310.2 million, with adjusted EPS landing at $0.28. The sticking point: management’s fresh full-year revenue outlook, now at $1.185 billion to $1.205 billion.
- Sentiment flipped quickly. Analysts pointed to a mix of AI-driven buying pauses, pricing-model risk, and stiffer competition from private players like Apollo and Clay.
ZoomInfo shares tumbled Tuesday, not because of lackluster results—the quarter itself came in fine—but investors zeroed in on the disappointing outlook.
ZoomInfo outpaced its own Q1 goals, posting GAAP revenue of $310.2 million and operating income at $57.9 million. Adjusted operating income reached $109.7 million—this metric, which filters out stock-based pay and restructuring charges, is a favorite for those zeroing in on core profitability. Still, the company slashed its 2026 revenue guidance to $1.185 billion-$1.205 billion, down from $1.247 billion-$1.267 billion, and its unlevered free-cash-flow forecast now sits at $400 million-$420 million instead of the earlier $435 million-$465 million.
This is what pushed the chart. A revenue guide reflects management’s outlook—not what just happened. If a software firm tops Q1 but lowers its full-year view, investors tend to disregard that initial beat.
Management pointed to a pause in customer buying, as clients try to figure out where AI fits—what it can automate, replace, or make less expensive. On the call, CEO Henry Schuck said, “AI has structurally changed how software is built, bought, and used,” highlighting a clear shift: customers are stepping away from seat licenses, opting for data delivered via APIs, Claude, and similar AI-driven setups. The fix on deck is a hybrid approach: a smaller platform fee, bundled with pre-paid data credits. Annual contract value, or ACV, refers to the yearly worth of those deals. The Motley Fool
This isn’t just about demand—it’s a question of faith in the old way of doing things. ZoomInfo’s bread and butter has been selling access to its data through seat-based deals for sales and marketing folks. But now, seat compression is a real threat: fewer seats licensed, less money coming in, even if customers still value the data itself.
The restructuring spelled it out: ZoomInfo’s board signed off on plans to lay off around 600 people—close to 20% of the company’s headcount at the end of Q1. They’re expecting pre-tax charges in the $45 million to $60 million range, and projecting annual run-rate cost savings of about $60 million once the dust settles. Run-rate costs are what the company anticipates spending per year after the changes kick in.
Bulls still have a case here. ZoomInfo’s extensive B2B database matters, especially since AI relies on high-quality company and contact information. Upmarket annual contract value rose 5% from a year ago. Upmarket now represents 75% of ACV. Net revenue retention landed at 90%—that’s the percentage of revenue kept from existing customers after accounting for churn, downgrades, and expansions.
The bear camp is making more noise these days, and it’s not pretty. If customers shift more of their workflows into AI platforms, ZoomInfo could keep moving data but lose leverage when it comes to pricing its software. BTIG’s Allan Verkhovski cut his rating to Neutral, cautioning that ZoomInfo is “unlikely to receive the benefit of the doubt” as disruption risks mount. Stifel, too, flagged AI-driven disruption and a stretch in sales cycles as trouble spots. Investing.com
Canaccord analyst David Hynes Jr. didn’t mince words after downgrading ZoomInfo to Hold and slashing the price target to $5 from $12: “cheap absent a catalyst” is hardly the pitch software investors want to hear. That’s the sticking point. On paper, ZoomInfo trades at a low multiple following the selloff, but what the market really wants is evidence of a growth rebound—not just stable margins. Investing.com
The company’s got headwinds from rivals. Apollo and Clay are making moves in private markets. HubSpot, another player in public sales and marketing software, dropped roughly 5% Tuesday. Salesforce, big in the customer software space, lost about 3%. The pressure wasn’t unique to ZoomInfo, though its decline was much steeper and more specific to the company.
There’s still a slim way forward. Should enterprise buyers ramp up data spending for AI agents, ZoomInfo’s move to consumption-based pricing might cushion the blow from losing seat licenses—and possibly kickstart growth again. But if this lull drags on, that same pricing change might just drag the company’s value down before any upside kicks in.
Right now, shares are acting as if investors doubt management’s transition timeline. Adjusted EPS guidance is unchanged at $1.10-$1.12. That wasn’t enough to support the stock. What traders looked for was evidence of demand. Instead, they saw a cost-cutting push and a fresh model rollout.
