ZoomInfo, a leading provider of database information for corporate sales and marketing teams, has seen a sharp decline in its shares in late trading following the announcement of a reduction in its full-year financial guidance. Although the company did not provide an explanation for the revised forecast, investors have reacted negatively, causing the stock to drop 18% to $21.
Second Quarter Performance
In the second quarter, ZoomInfo reported a revenue of $308.6 million, which represents a 16% increase compared to the same period last year. While this growth is commendable, it fell slightly short of Wall Street’s consensus estimate of $310.9 million. On the bright side, adjusted profits exceeded expectations at 26 cents per share, compared to the consensus of 23 cents. However, under generally accepted accounting principles, the company’s earnings stood at nine cents per share.
CEO Optimistic Despite Adjusted Projections
Despite the dip in full-year guidance, CEO Henry Schuck remains positive about the company’s performance. In a statement, he expressed satisfaction with another quarter of revenue growth, increased profitability, and free cash flow generation.
Revised Projections for September Quarter
ZoomInfo’s projections for the September quarter also reflect a more conservative outlook. The company is now forecasting a revenue range of $309 million to $312 million, with adjusted profits projected between 24 and 25 cents per share. Analyst consensus initially anticipated a revenue of $325.8 million and 25 cents per share.
Reductions in Full-Year Guidance
Furthermore, ZoomInfo has revised its full-year guidance, reducing the revenue forecast range from $1.275 billion to $1.285 billion to $1.225 billion to $1.235 billion. Similarly, the non-GAAP free cash flow projection has been adjusted from $507 million to $517 million to $445 million to $455 million. The new non-GAAP EPS forecast is now 99 cents to $1 per share, narrowing the previous range of 99 cents to $1.01 per share.
Expansion of Stock Repurchase Program
Despite the revised projections, ZoomInfo has announced a significant boost to its stock repurchase program. The company plans to expand the program by $500 million, reflecting its commitment to creating value for shareholders.
While the reduction in guidance may have dampened investor enthusiasm temporarily, ZoomInfo remains confident in its long-term growth prospects.
