Good afternoon, everyone. Welcome to our final session of the day. I'm Surinder Thind, the Technology and Information Services Analyst here at Jefferies. With me, I have Graham O'Brien, the Interim Chief Financial Officer for ZoomInfo. Thanks, Surinder. We have about 25 minutes, so let's just get this started here. Taking a look back, you've had a couple of good quarters here where it seems like demand's finally turning. What is your assessment of where you think we are in the cycle? Perhaps you can maybe discuss it in terms of the upmarket versus the downmarket segments. Yeah, I think that's a great way to think about it. I think we've gotten to a place where our upmarket business is reaccelerating, and we are managing our downmarket business with the goal of making it a smaller and healthier version of itself. When we think about upmarket, those are our customers that have 100 or more employees, what used to be our mid-market and enterprise segments. That upmarket business is now 71% of our total ACV, up a point from 70% exiting 2024. That business is growing 3% year- over- year, which is an acceleration from the 2% it was growing year- over- year in Q4. Our downmarket business is now down to about 29% of our total ACV, and it is declining 10% year- over- year as we effectively qualify more of that business on the front end and potentially get higher quality, lower volume business in the door from the downmarket perspective. If we were to segment it a bit further, how are you thinking about it in terms of last year you rolled out a new product, Copilot? Can you maybe just talk about the growth right now you're seeing in terms of just the new clients that you're able to bring on board versus upselling or converting existing clients? Yeah, we released Copilot just about a year ago. We announced another new product, Go-to-Market Studio, a couple of weeks ago. All of the product development that we're doing is largely aimed at driving and accelerating upmarket growth, and more specifically aimed at kind of optimizing the retention outcomes for those customers. Copilot, last we disclosed, was $150 million of run rate ACV back in February. We continue to expect to migrate our core sales ZoomInfo offering to Copilot over the next few years and expect that Copilot, coupled with operations inclusive of Go-to-Market Studio, will be the products that accelerate growth upmarket. From a new business customer acquisition perspective, most of our new business is now coming in on a Copilot experience. We continue to have a fair amount of momentum in customer acquisition upmarket. I think you started seeing that momentum in Q2 last year, right around the time that we resegmented our new business account executives and had dedicated teams aimed at enterprise and mid-market customers in addition to the downmarket business. We are still seeing significant year-over-year growth upmarket from a new business ACV perspective. That's helpful. We'll get into the segmentation and the sales strategy in a little bit here. When I think about who's buying Copilot right now, what is the incentive to buy the product? Can anyone buy the product at this point, or do you need a lot of good data and infrastructure behind that first? Maybe just walk the journey through the client's decision process or the journey that they go through at this point. Yeah, I think it's fair to say that anyone can buy it, but good data, whether you have a CRM, all these things generally help with fit or setup for Copilot. So we're able to kind of score whether it's an existing customer, whether it's the right time for them to migrate, whether it's a new business customer, and effectively figure out what version or setup of Copilot is best for them based off of a sophistication sale. I think generally anyone who would like to buy Copilot can buy it at this point. When we think about kind of the return on Copilot or the incremental value, what we're seeing is a 60% increase in demos booked, a doubling in connect rates, as well as about 10 hours per week back to sales reps from a productivity perspective. Okay, so good metric. And then in the situations where maybe you're having the conversations with clients, but they're choosing to maybe hold off, just any color you can provide with any insights there? Yeah, I think specifically for our existing customers who are not on Copilot yet, there's kind of a few conversations we'll have. I think we're going to lead with Copilot in almost every renewal conversation. Most of the time, customers are eager to migrate over, whether it's at renewal or essentially at an off-cycle upsell. For customers that aren't ready, I think that those conversations are more around they might not have CRM, so that fit might not be ready for the advanced functionality that comes along with Copilot. They might be looking for more of a basic contact and company lookup use case for kind of the lower end of downmarket, in which case they might want to hold off from Copilot for another year or something like that. Got it. In terms of when I think about just the shift in this or the increased segmentation in terms of your sales strategy, historically you focused on sales and marketing professionals. You're also looking now at account management, account executives, more formally going after those. Can you maybe talk strategically about this shift, how long it's been underway, and just the sales motion around it? Yeah, I think we're really early in the opportunity there. I think we're excited about the kind of expansion in personas that Copilot provides. We look at our use case internally at ZoomInfo, and when we rolled out Copilot, we saw that the kind of greatest increase in incremental usage and leverage was from our account management team that had not historically been power users of ZoomInfo. We have a footprint at lots and lots of upmarket and enterprise customers where their current users or their seat base is SDRs, maybe some account executives, but we have very large account management customer success seats at those customers that aren't on ZoomInfo yet. We view Copilot as an unlock to effectively have an opportunity to go and sell those to those teams. We can do that without a reliance on net headcount increases in the market. I think we've seen the value that those teams can get from Copilot, but we're still pretty early in actually the penetration story there. Maybe what does it mean from an opportunity or TAM perspective? How big do you think that opportunity actually is? Yeah, I think it's incremental to what we viewed our TAM as historically. I think if you think about SDR and parts of AE, I think that once you start to add in account management and CSM and sales leadership, you start to talk about doubling or tripling that seat TAM. That's helpful. Just as we think about the newer product release with your Go-to-Market Studio offering, how does that overall fit in the context of the conversation that we just had and the Copilot product? How does it overall change the dynamics of how the clients view the collective set of the product offering? Yeah, I think it's the next kind of core piece in the Go-to-Market intelligence platform. When I think about where Go-to-Market Studio fits in, I think about this as kind of on a spectrum of a Go-to-Market operation. The first stop there is our operations or our core data asset. That is not a seat-based product. This is kind of a we're selling data access on a subscription basis. Usually, the buyer here is a Chief Information Officer or a head of RevOps, a Chief Data Officer. We're licensing them or they're subscribing to the data access. We're enriching it, routing it, and cleansing it. They're using that for TAM analysis or territory planning or other AI projects internally. At the very other end of the spectrum is Copilot and ZoomInfo Marketing, which is kind of like the frontline seller and marketing activation, which has largely been seat-based. We just talked about kind of the incremental seat opportunity we see there from the persona expansion. In the middle, there is, I think, where Go-to-Market Studio fits in as effectively an application or UI layer on top of operations that empowers a RevOps leader to come in, query different sets of third-party and first-party data into one pane or one workbook, and then easily organize and orchestrate that data, enrich it with AI insights, and then push that out to a marketing professional for a campaign or push that out to the frontline sales org. When you think about the product set as you go from the OS side to the Copilot and everything in between and kind of the needs of the sales organization or the broader Go-to-Market function, can you maybe talk about the changes that you're actually seeing in the marketplace with AI in terms of structural changes in the way that companies behave, the way that they're structuring those teams? How should we think about that, of how the products were initially designed and how, I'll say, just corporates are evolving at this point in terms of that functionality? Yeah, I think there's a greater focus on automating workflows. I think with kind of the connective tissue between operations, Go-to-Market Studio, and Copilot, we're able to take our best-in-class data advantage and build application on top of that that starts to allow for repeatable and intelligent workflow automation. That for us, we want to be able to, or essentially position the Go-to-Market intelligence platform as more workflow integrated than what kind of our value proposition was several years ago. Does that change the dynamics of, I guess, the opportunity, the growth profile as you kind of look ahead? I mean, it sounds like we've been in a period where headcount growth has been limited within sales. Let's talk about even further automation. How do you think about that dynamic as you look ahead? I think we have positioned ourselves to have a more diversified set of opportunities for growth. We have got kind of existing seats at customers where we think we have penetration opportunity. We have got incremental data access and operations opportunity, both with operations customers who generally do tend to buy more in different data cubes for existing ZoomInfo customers who might not be operations customers. Then with the introduction of Go-to-Market Studio, which will be tied more to operations and less seat-based. I think as this kind of demand environment evolves, we have developed a suite of products that provide growth opportunities in numerous ways. Maybe following up on that, really strong growth within the operations segment. Can you talk a little bit about what you're seeing there in the current environment? I believe it's greater than 20% growth at this point, how large a segment that is, and just how you think about the opportunity and really pushing that forward? Yeah, it's one of our biggest drivers of growth. It's 20% plus from a scale perspective. About a year ago, it was already over 10% of our ACV. We view this as it's also almost exclusively upmarket business. As more and more companies really start to realize the need for best-in-quality data to support their Go-to-Market planning, to support any other AI initiatives that they have, we see kind of incremental unlock in effectively becoming the de facto data provider in the upmarket world. At this point, is this the largest customers that are the very large that are generally pushing that forward? Is it a penetration driver that's growth? How are you thinking about why is it growing at 20% at this point? Yeah, it's generally some of our larger customers and larger spend profiles. I think the two, we do have a net new customer acquisition opportunity here, but I think the two vectors that we're focusing on are expansion with existing operations customers. We have a lot of existing ZoomInfo logos that aren't yet operations customers, even within the enterprise, that we view as kind of a really efficient next kind of incremental cross-sell opportunity. Got it. Just keeping with the idea of demand here, in prior commentary, you've mentioned that you haven't really seen any change in client behavior despite kind of the volatility that we've seen around tariffs on again, off again, macro volatility, what it might be. Is that still holding true at this point in time? If so, why? When we think about just as you laid out your guidance and your scenario analysis, if you haven't seen any change in behavior, does that mean that there's a leg down scenario that you've considered at this point? Yeah, the first question, we did not see a change in customer or buyer behavior at the end of Q1 in April, and we still haven't really seen any change to this point. I think we all kind of acknowledge there is heightened uncertainty. It's just not really showing up in our existing or new customer pipeline. When we updated guidance in May, we still wanted to take maybe just an incrementally conservative approach. We reiterated most of our guidance from a revenue perspective. We brought up the bottom end of the range some, especially because the Q1 revenue result alone, it largely de-risked that range. We're trying to balance what were really good results with Q1 with an acknowledgment that while we haven't seen anything affecting our business specifically, it is a bit more uncertain out there. Got it. Would the uncertainty show up in, I assume, the SMB market versus the enterprise at this point? Or how do you think about those two? I think we view the SMB or our downmarket business as, yes, more sensitive to cyclical changes. What we've done with our guidance approach this year is the guidance assumes that our upmarket business gets to mid-single-digit growth this year and that our downmarket business declines to high negative single or negative teens. That would be a significant decline from where we are now. As we start to lap some of the improvements we made specific to the downmarket business last year, there's potential that we actually see stabilization or improvement there. Considering the sensitivity or kind of lack of visibility that we've historically had downmarket, we thought it was prudent to give ourselves some room there. Just in terms of when you think about stabilization, I think you've thought about it as downmarket maybe being 25% of revenues, maybe getting down to 20%. Is that the point where then it kind of grows in line with the business? What does stabilization actually mean? Is that more of a dollar figure where you just kind of hope to keep it at a break-even level? Is it just structurally that's where it ends up? Yeah, I think we're still, I think when I view it as stabilized, I think the first step would be to get back to 0%. We're effectively taking our downmarket business right now, and for the lower end of that downmarket, we want to be pushing more and more of that through a self-serve digital motion where we're getting an efficient customer acquisition, but we're not relying on it for significant revenue contribution yet. We're effectively going to test that out and be more aggressive with that this year and into next year. I think the first milestone that we see upcoming is getting that market to being 75% of the total mix, whether that's in two years or even a little bit faster now. At that point, whether downmarket is continuing to decline or closer to 0%, I think that we'll have options to start to dial that up or down a little bit. The next milestone there is 80% and 20%. At that point, I believe that downmarket will certainly be a smaller and healthier version of itself where it is potentially growing 1% or 2% in a given year or down 1% in a given year, but is not as dilutive to our full year growth as it is today. In terms of just the Salesforce itself, you used to have a fairly large contingent focused on downmarket. What does the Salesforce look like now, and how is it evolving as you focus on the enterprise? It's significantly more weighted upmarket and more weighted to the renewals and growth or the retention side of our upmarket business. I think that improving our upmarket retention is the most important target for us over the next couple of years to get back to a place of more stable, durable overall growth. Our upmarket business has higher margins than our lower or our downmarket business. As we do shift the business upmarket, we should, at a minimum, have stable margins, but with the opportunity to actually expand those margins. It's generally not a one-to-one reallocation as we take or essentially as we push more through a self-serve motion downmarket and reallocate some of those sales resources upmarket. It's not $1 out, $1 out, $1 in upmarket. Generally, there will be a net savings to the overall cost basis as we do that. Got it. In terms of just when we think about the pace of technological change, we think about all of the products and features that you've kind of rolled out over the past year, how do we think about it on a go-forward basis? Is there a lot more that you need to build or you want to build? How should we just think about current spend levels? Is there an opportunity to pull back at the future, or does change mean you've got to keep the spend going? Yeah, I think if you look at our R&D as a% of revenue right now, that reflects an R&D team that is building game-changing, significant new products, Copilot, Go-to-Market Studio. I think we have aggressive roadmaps to follow up with those products over the next few years. I don't think there's a need to incrementally step up R&D above where it is today. To the extent that we are not building that level of product, you would see it come down. I do think that we're confident in our ability to continue to build and release game-changing products. You should think about R&D as probably at stable where it is. Are there certain features, functionality that you're looking at, or it just sounds like there's a lot of product coming down the pipeline? How should we think about the roadmap? Yeah, I mean, with Copilot, we've been out for a year now. We're still kind of we've taken a lot of feedback from those first six months from both our internal users and our customer base. We're, I think, well on our way to releasing more and more features that really make this kind of a premium product, whether that's kind of more automation in account planning or pitch decks and other things that just really help save those users' time and make them more productive. With Go-to-Market Studio, I think we're not releasing that yet. We announced it a couple of weeks ago. We're working with a small group of customers right now to really build and optimize this over the next few months. We'll expand that customer population in Q3 and then largely have it out and released in Q4. We really want to make sure that we have sought the feedback we need with Go-to-Market Studio and that it's ready when we kind of more generally release it in Q4. I think that the roadmap there will be kind of incremental APIs and linkages to other data sources as we get into the first quarter or two of it being GA. Got it. We've got maybe about two, two and a half minutes here, so I want to sneak in one or two more. Let me ask about capital allocation because I don't want to miss that part of the question here. Can you talk a little bit about that? You've been buying back a lot of stock. At this point, I think you're above 15% in terms of the amount of float that you've repurchased over the past year plus. Talk about that a little bit, please. Yeah, I think we've been aggressive with buying back shares. We generate a fair amount of free cash flow. Considering where the share price is, considering our view of the intrinsic value of ZoomInfo, I think you can assume that we'll continue to be aggressive in allocating most of our free cash flow to buying back shares. We're always going to be monitoring the M&A landscape. If there's something attractive there, we'll certainly consider that. I think right now we're focused on the value of the buyback. It sounds like you're looking at M&A, but it doesn't sound like there's anything close or anything that fits the criteria at this point. I think what we have seen is kind of tuck-ins here or there that can accelerate our roadmap. Kind of a build or buy. Finding those at kind of like the right price or whether it's an acquihire or something like that, I think has been largely the focus of M&A. That allows us to continue to take most of the capital that we have and the cash that we're generating and continue to buy back shares. Got it. Maybe we've got less than a minute here. I'll just ask about the internal use of Copilot. How has that experience been? How have you thought about the productivity gains that you guys have been realizing and how you can message that to your clients? Yeah, I mean, our internal sales team are the best beta users of Copilot. That was the case before we released it. What we're really excited about is that we've seen the greatest increase in usage from that account management team that historically had not been the power users there. We've got dozens, if not more, of kind of wins that are coming from Copilot internally that we're learning from and then trying to share kind of that ROI or those kind of plays with our customers. Okay, thanks a lot, Graham. That takes us to time, so Thanks, Surinder. This presentation has now finished. Please check back shortly for the archive.