Thanks, Daniel. Welcome to ZoomInfo's financial results conference call for the fourth quarter and full year 2025. With me on the call today are Henry Schuck, Founder and CEO of ZoomInfo, and Graham O’Brien, our Chief Financial Officer. During this call, any forward-looking statements are made pursuant to the Safe Harbor provisions of U.S. securities laws, expressions of future goals including business outlook, expectations for future financial performance, and similar items including without limitation, expressions using the terminology may, will, expect, anticipate, and believe, and expressions which reflect something other than historical facts are intended to identify forward-looking statements. Forward-looking statements involve a number of risks and uncertainties including those discussed in the risk factor section of our SEC filings. Actual results may differ materially from any forward-looking statements.
The company undertakes no obligation to revise or update any forward-looking statements in order to reflect events that may arise after this conference call except as required by law. For more information, please refer to the forward-looking statements in the slides posted to our investor relations website at ir.zoominfo.com. All metrics on this call are non-GAAP unless otherwise noted. A reconciliation can be found in the financial results press release or in the slides posted to our IR website. With that, I'll turn the call over to Henry.
Thank you, Jerry, and welcome, everyone. We entered the year strong with record quarterly revenue and results that beat the top end of our guidance. In the fourth quarter, we delivered revenue of $319 million, up 3% year-over-year, and adjusted operating income of $123 million, representing a margin of 38%, once again returning to Rule of 40 performance. In 2025, we delivered $1.25 billion in revenue with an AOI margin of 36%, and we grew free cash flow per share by more than 10% for the year. We also returned more than $400 million in capital to shareholders through share repurchases, all while investing in the business to drive innovation and build the GTM intelligence platform of the future. Our upmarket strategy is working. Upmarket again grew 6% in our seasonally largest upmarket quarter, triple the upmarket growth rate from a year ago.
We now have 1,921 customers with more than $100,000 in ACV, the seventh consecutive quarter of adding logos to this cohort, and $100,000 customers now represent more than 50% of total company ACV. We also have a record number of million-dollar-plus customers, and in the quarter, we delivered a double-digit increase in logos year-over-year, accompanied by an even larger increase to the ACV within that million-dollar customer cohort. More than half of our total ACV is now on long-term contracts, and that mix increased five points in 2025 alone. Customers are increasingly making long-term investments with ZoomInfo as they realize the clearly differentiated value of our platform. The migration to Copilot continues as planned, and as Copilot scales, we are pleased to see continued strong uplift as we renew customers at higher rates on the Copilot platform.
Over 20% of our total ACV is coming from Copilot after it more than doubled in 2025. Success in our operations business continues to be driven by demand for actionable, high-quality data, a key foundation to power AI use cases, and operations again grew more than 20% year-over-year in the quarter. Our comprehensive data universe is the data advantage that organizations need to bring agents and workflows to life. ACV from operations is now nearly a fifth of our total ACV. 2025 was a year of fast-paced innovation as we rebuilt our product and engineering motions to be AI-first and leveraged AI and LLMs to improve our data quality and build out the broader ZoomInfo platform. Our data moat has always been the foundation, over a decade of innovation and expanding patent portfolio and technology for aggregating and unifying B2B data that is nearly impossible to replicate.
AI development tools have lowered the cost of building software, but they don't erode our advantage at the data layer. They accelerate what we can build on top of it. We are more than a horizontal software company, and AI has been an accelerant, expanding the use cases we power and the workflows where ZoomInfo shows up. Historically, our data powered specific prospecting and enrichment workflows, with AI expanding that surface area into two clear directions. First, demand for entirely new categories of data. We launched nine vertical data sets this year: franchise ownership, restaurant operations, commercial fleet intelligence, addressing specialized markets that generic B2B data never served. Second, new go-to-market use cases. Customers are using our data to power AI agents, build audiences programmatically, and run end-to-end campaigns that didn't exist two years ago.
Operations, our data-as-a-service platform, grew more than 20% year-over-year as we invested in data quality alongside that growth, adding over 10 million contacts and expanding coverage across six European markets because our customers' AI agents and workflows are only as good as the data powering them. That expanding surface area is why we built GTM Studio, an orchestration layer where revenue operations teams unify CRM data, warehouse data, and ZoomInfo intelligence in one workspace to build audiences, enrich with AI agents, and activate directly into downstream systems. We've seen strong traction, particularly from companies using AI tools like Claude and ChatGPT alongside our platform. No other vendor in go-to-market controls both the data layer and the application layer with end-to-end orchestration and execution. That's our structural advantage. But orchestration without execution is incomplete.
Revenue teams still operate across six or more separate tools: CRM, contact databases, conversation intelligence, research platforms, AI assistants, and spreadsheets. That fragmentation wastes the intelligence we deliver. Most sellers today have no AI-native interface. GTM Workspace is our answer, a fully AI-native command center where sellers get full GTM context with natural language AI synthesizing CRM data, signals, and conversation history. Customers can go from idea to campaign to execution to ROI measurement in one system. Over 20% of our total ACV is now on our first AI platform, Copilot, after it more than doubled in 2025. As we expand Workspace to existing Copilot customers, we're seeing strong renewal uplift and opportunity to consolidate tool budgets. This is an enterprise-grade Workspace that deploys in weeks, not months. We've made ZoomInfo available where go-to-market work happens, beyond our own applications.
We integrated our data directly into Claude through MCP Server technology, allowing our customers to use AI agents for audience building, meeting prep, and email drafting, all powered by our data. We deepened integrations with Salesforce, HubSpot, and Microsoft Dynamics. Whether customers access our intelligence through our applications, through an AI agent, or through something they built themselves, the data flows to where work happens, positioning ZoomInfo as the only platform that delivers intelligence, orchestration, and execution for modern go-to-market teams. As you consider the product innovation that has taken place in 2025, I would also emphasize that we deliberately took our time to get it right, and we've worked closely with customers to refine these products. We have not and will not optimize for any single quarter's results, but rather for the multi-decade opportunity we see in front of us.
We are now ready to go on the offense with these new products commercially available in 2026, and those efforts are underway now with extraordinarily encouraging early signals, including with monday.com enterprise demand generation team who used GTM Studio to unify data across internal and external sources, helping them build sophisticated audiences with enriched signals and activating them directly in their marketing campaigns, reducing campaign build time, and enabling them to launch more targeted initiatives each quarter. They have described GTM Studio as a game-changer. During the quarter, we closed upmarket opportunities with Hilton Hotels, Edward Jones, a leading financial services firm with more than 20,000 financial advisors, Kaseya, a fast-growing IT management and cybersecurity software provider for MSPs, and Randstad, a global provider of staffing, recruitment, and workforce solutions.
We want a competitive RFP to transform a Fortune 500 company's contact data management across their $20 billion business after we analyzed 25 million contacts and demonstrated best-in-class contact management, including identifying new buying committee members to support their pivot to service-based solutions. The consultant they hired concluded that no other competitor came even close, proving ZoomInfo is the right strategic partner for go-to-market business transformation. We migrated a $30 billion global IT company to Copilot by consolidating fragmented contracts across teams and subsidiaries into a single enterprise agreement with global data access and developer capabilities. These customers' success examples and thousands more continue to illustrate why we are a critical piece of the go-to-market tech stack for some of the largest and most successful companies in the world. We are data and software used in concert.
Whether you're working in Claude, using a bespoke vibe-coded app, or using a battle-tested, scalable, and secure piece of enterprise software, in every instance, whenever go-to-market is happening at scale, our data will continue to be critical to powering users and agents. No amount of AI makes that need for data go away. It only enhances the value that we create for these companies. AI multiplies the surface areas where go-to-market work happens and gives us new opportunities to monetize our go-to-market context graph and go-to-market data. Turning to capital allocation, I would first reiterate our commitment to using the majority of the cash we generate to repurchase ZoomInfo shares for as long as that is the best and highest-return use of our free cash flow. Given the unprecedented negative sentiment of public markets toward anything software-related, we believe our share price is completely disconnected from economic reality.
As such, today, we announced an additional $1 billion authorization for share repurchases, representing roughly 50% of our market capitalization. We have already retired nearly 25% of our shares since the start of 2023, and we intend to opportunistically deploy this additional $1 billion while continuing to double down on execution. We have been presented with a generational opportunity to create value. While we can't control market forces, we do control our execution and our capital allocation. Our strong free cash flow generation and efficient operating model enable us to uniquely take advantage of the prevailing negativity. Equipped with our best products and our best leadership team ever, in 2026, we will rev our distribution engine and bring the go-to-market AI platform to all go-to-market professionals. We are confident in our path ahead and in our ability to sustainably deliver revenue growth and industry-leading profitability.
We will continue to grow free cash flow per share while defining the future of go-to-market with solutions that help our customers win in increasingly competitive markets. With that, I'll turn the call over to Graham.
Thanks, Henry. Q4 GAAP revenue was $319 million, up 3% year-over-year, and adjusted operating income was $123 million, a margin of 38%, both above the guidance ranges we provided and again above Rule of 40 company performance. For the full year, GAAP revenue was $1.25 billion, up 3% year-over-year, adjusted operating income was $446 million, a margin of 36%, and adjusted unlevered free cash flow was $455 million, all above the guidance ranges we provided at the beginning of the year and above our updated guidance as we beat and raised throughout the year. Through a combination of revenue growth, disciplined profitability management, and consistent share repurchases, we also delivered on our goal of meaningful growth in free cash flow per share, growing adjusted levered free cash flow per share from $1.07 in 2024 to $1.20 in 2025, representing 12% growth.
At current valuation levels, we are in the range of a 20% free cash flow yield, further supporting our belief in the opportunity to unlock enormous latent value considering the operating trends of the business. Q3 was a strong upmarket growth quarter for us, and we were pleased to see the momentum continue into Q4. We grew upmarket by 6% year-over-year in the fourth quarter, tripling the growth rate year-over-year in our seasonally largest upmarket quarter. We have successfully shifted four points of business upmarket over the past year, and we exit 2025 with 74% of our business now upmarket. These upmarket customers buy more of the platform and renew at higher rates, driving better growth and profitability outcomes. We now expect to reach 80% upmarket mix exiting 2027, several years ahead of our initial timeline.
ACV from the 100K customer cohort grew double digits and now represents more than 50% of total company ACV, and we now have the most million-dollar-plus customers in ZoomInfo history. We are also successfully diversifying our business model beyond seat-based pricing as we look to align price with the value we deliver to customers. Seat-based pricing contribution mix peaked in 2022, and we have progressively decreased that contribution every year since then. AI activities, ELAs, data, and platform access continue to contribute to increasing the mix of non-seat-based revenues, which we expect over time will lead to more durable growth. Net revenue retention was 90% in the quarter, with similar levels of contribution from upmarket and downmarket as in Q3. Turning to cash, GAAP operating cash flow was $143 million in Q4, up 30% year-over-year and seasonally stronger than anticipated.
Unlevered free cash flow for the quarter was $135 million, 110% conversion from adjusted operating income and representing a margin of 42%. Q4 was stronger than expected due to timing of customer payments, and as a result, we would expect conversion to moderate in Q1, and we have accounted for that Q4 overperformance in our 2026 unlevered free cash flow guidance. Stock-based compensation expense declined below 10% of revenue for the year, with improvements coming through a combination of revenue growth and an absolute decline in stock-based compensation expense, which we believe is an important consideration when comparing the quality of our earnings relative to software benchmarks. Additionally, we continue to aggressively shift our equity compensation to performance-based plans, further aligning executive compensation with shareholder value creation.
When looking at our gross share dilution, which is low in absolute terms, keep in mind that much of that dilution will only occur if we achieve rigorous growth and free cash flow objectives. We only want our team to win when shareholders do. In Q4, we repurchased 7.7 million shares of Common Stock at an average price of $10.26 for an aggregate $79 million. For the full year, we repurchased 40.5 million shares at an average price of $10.06, representing 12% of total shares outstanding for an aggregate $407 million. Weighted average diluted shares outstanding for the quarter used in calculating non-GAAP diluted earnings per share was 327 million, and the non-GAAP share count exiting the year was 324 million. Over the past two years, we have returned nearly $1 billion to shareholders through repurchases.
With the additional $1 billion authorization announced today at the current stock price, we now have board authorization to repurchase more than 50% of the company's outstanding shares. As Henry indicated, we reiterate our commitment to using the majority of the cash we generate to repurchase ZoomInfo shares for as long as that is the best and highest-return use of our free cash flow, and at these price levels and with a healthier upmarket customer base and a promising suite of new innovative AI products that we're just now bringing to market, our conviction is as high as ever. We ended the quarter with $180 million in cash, cash equivalents, and investments, and we carried $1.3 billion in gross debt.
As a result, our net leverage ratio is 2.4x trailing 12 months adjusted EBITDA, consistent with the year-ago period, and 2.4x trailing 12 months cash EBITDA, which is defined as consolidated EBITDA in our credit agreements, as compared to 2.2x in the year-ago period. The interest rate swap contracts used to manage our exposure to interest rate movements related to our first lien term loan matured on January 30th, 2026. Interest expense for the first lien term loan bears a variable interest rate based on SOFR, and as a result, we expect the interest expense on our outstanding debt to increase. We have also continued to restructure and right-size our real estate footprint, and during the year, we recorded impairment charges as we reduced the carrying value associated with our Vancouver, Washington, and Ra'anana, Israel offices.
We expect restructuring cash flows in 2026 related to funding tenant improvements for the excess space that we have sublet. With respect to liabilities and future performance obligations, unearned revenue at the end of the quarter was $478 million, and remaining performance obligations, or RPO, were $1.25 billion, of which $887 million are expected to be recognized in the next 12 months. Calculated billings were flat for the year, while current calculated bookings were up mid-single digits for the year. There is inherent volatility in both of those metrics, and I would continue to caution you from extrapolating too much from the trajectory of either.
When considering balance sheet reserve entries, billing terms and policies, early renewal volume, and the impact of lower write-offs on reserve rates, billings and current bookings growth rates more closely mirror each other in the positive low-single-digit range, which is a better proxy for our current growth rate. In summary, we delivered strong Q4 results carrying the momentum we had coming out of Q3 through to the end of the year, and we enter 2026 excited about the incremental tailwinds ahead. Transitioning to guidance, for Q1, we expect GAAP revenue in the range of $306 million-$309 million, adjusted operating income in the range of $105 million-$108 million, and non-GAAP net income in the range of $0.25-$0.27 per share.
For the full year 2026, we expect GAAP revenue in the range of $1.247 billion-$1.267 billion, representing positive 1% annual growth for the year at the midpoint of guidance, and adjusted operating income in the range of $456 million-$466 million, representing a 37% margin at the midpoint of guidance. We expect non-GAAP net income in the range of $1.10-$1.12 per share based on 325 million weighted average diluted shares outstanding, and we expect unlevered free cash flow in the range of $435 million-$465 million. From a modeling perspective, items that I would call out as you think about 2026: we are more confident in the foundation of the business, and our guidance reflects that.
Q1 2026 has two fewer days than Q4 2025, which should be considered when comparing sequential trends, and similar to 2025, I expect our AOI margin to decline sequentially in Q1 from Q4 and steadily build throughout the year as Q1 margins are impacted by payroll taxes and other benefit resets. Also, I would expect a non-GAAP tax rate of 12% in 2026, cash interest expense in the range of $60 million-$65 million, and CapEx as a percentage of revenue closer to 5%. In closing, we remain committed to properly managing expectations, delivering revenue growth, margin expansion, and aggressive share repurchases in 2026, which support our expectation of continued free cash flow per share growth. Now, I will turn it over to the operator to open the call for questions.