ZoomInfo Technologies Inc. (ZI) Q1 2022 Earnings Call Transcript

ZoomInfo Technologies Inc. (ZI 0.84%)
Q1 2022 Earnings Call
May 02, 2022, 4:30 p.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good day, and thank you for standing by. Welcome to the ZoomInfo first quarter year 2022 financial results conference call. [Operator instructions]. I would now like to turn the conference over to today's speaker, Mr.

Jerry Sisitsky. Please go ahead.

Jerry Sisitsky -- Investor Relations

Great. Thanks so much. Welcome to ZoomInfo's financial results conference call, highlighting our results for the first quarter of 2022. With me on the call today are Henry Schuck, founder and CEO of ZoomInfo; and Cameron Hyzer, our chief financial officer.

After their remarks, we'll open the call to Q&A. During this call, any forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. 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 factors section of our filings with the SEC.

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 cautionary statement included in the slides that we have posted to our Investor Relations website at ir.zoominfo.com. All metrics discussed on this call are non-GAAP unless otherwise noted.

A reconciliation can be found in the financial results press release or in the slides that we have posted to our Investor Relations website. Lastly, we hope that you can join us for the virtual investor event we are hosting on Thursday, June 2nd, beginning at 3:00 p.m. Eastern time. More information is available through our Investor Relations website, and we look forward to your participation.

With that, I'll turn the call over to our CEO, Henry Schuck.

Henry Schuck -- Chief Executive Officer and Founder

Thank you, Jerry, and welcome, everyone. The first quarter was a great start to the year. We continue to successfully execute our strategy and drive growth across all of our major initiatives. Our expanding Revel platform, which is deeply integrated with our world-class data and insight layer is resonating with customers.

We are increasingly seeing customers embrace the integrated platform experience. running more and more of their sales stack on ZoomInfo. In the quarter, we drove a more than 100% increase in customers using the combined Sales S platform, Engage, and Chorus offering, reinforcing the value of an integrated solution. In the first quarter, we delivered GAAP revenue of $242 million, year-over-year growth of 58%, and sequential quarterly growth of 11% when adjusted for the number of days in the quarter.

Adjusted operating income margin was 39%, and we generated $126 million in free cash flow. We continued to deliver a leading combination of growth, profitability, and free cash flow generation at scale. We closed the quarter with 1,623 customers with greater than $100,000 in ACV, up more than 65% year over year, while the average revenue across these customers continues to grow. And we saw incredibly strong growth in new business as the new customer team had their best Q1 ever on an ACV basis and the best quarter ever on a TCV basis.

On the international side, we have maintained our investment in data quality and coverage adding over 14.5 million non-U.S. professional profiles year to date and rolling out euro currency support in our platform, while quadrupling the headcount in our London office. As a result of our continued focus here, we set a record high for new business ACV added in EMEA, and international year-over-year growth remained strong at 80% on a greater than $100 million revenue run rate business. Our international business is predominantly driven by Western Europe and Canada, we have virtually zero exposure to Eastern Europe.

We continue to see solid traction with our enterprise clients. We signed deals with a number of leading enterprises, landing new firms and expanding more with existing customers. The three customers I'll highlight have all been ZoomInfo customers for at least a decade. And as we have continued to build out our RevOS platform and offering, they have also continued to increase their relationships across those offerings with us.

We signed an eight-figure deal with Alphabet in the quarter. Our recently released modern user provisioning now allows for anyone at Alphabet to quickly access the tremendous value of the ZoomInfo platform with automated self-provisioning. And since we are publishing ZoomInfo to directly on Alphabet Internet, understanding and getting comfortable with our privacy, security data collection, and compliance practices was an important part of the sales process. Google's revenue acceleration team is also leveraging Domino's operations OS platform.

That team adjusts company data and company insights to help inform the way they go to market. By leveraging our enterprise APIs, data has matched to normalize, pulled into a data warehouse, and consumed directly in their sales force instance, a consolidated view of highly accurate data and insights streamlines their ability to provide data to their go-to-market team while delivering success to their sellers, allowing them to sell more effectively. This type of deal structure serves as a road map for future enterprise expansion opportunities at other large companies. With Hitachi, we recently expanded our relationship into their marketing department and grew into a $1 million-plus ACV engagement that continues to leverage our sales platform across their sales teams and add OperationsOS to leverage ZoomInfo to enrich, append and clean across the historically inaccurate database of leads and prospect data for marketing campaigns.

While Hitachi leverages next generation of software across the marketing automation, data life and CRM, the value promised by that software has been unrealized as a result of the lack of high-quality data flowing through those systems. We intend to change that. Finally, Shopify signed a multiyear deal expanding ACV by more than five times growing to hundreds of users for the SalesOS platform and adding automated data enrichment from operations OS. Shopify's expansion enables them to improve outbound prospecting effectiveness, automatically enrich inbound lead information and build propensity to buy scores from that auto enrichment.

Customers are increasingly embracing functionality beyond just looking up the lead in the platform. More than 75% of our active users are using more advanced functionality, including intent and website visitor identification analytics, leveraging workflow rules or configuring page search or emailer. Following the close of the quarter, we completed two acquisitions, one to bolster our capabilities and market share on the recently rebranded Cowen platform and the other expanding our enterprise opportunity, both areas where we already see tremendous growth and are excited to invest behind. On the TalentOS side, companies have never faced such a challenging environment for hiring and retaining talent.

Roles that previously could have been filled through traditional job board now requires sophisticated direct sourcing. Candidates demand to work for companies with great cultures and expect an understanding of employee benefits and experiences before even applying to a job. Employers that have negative reputations online massively lease out on hiring top talent. In April, we acquired Comparably to empower every company to effectively identify source, influence, and hire for their most vital role.

Comparably add a suite of popular SaaS solutions for employer branding and recruitment marketing combined with an employee review platform that reaches millions of candidates each month. With Comparably TalentOS gives companies the ability to engage and hire candidates with much more sophistication and influence. TaklentOS plus Comparably is a must-have combination for any company recruiting in today's competitive work environment. An enterprise go-to-market, we know that the best-performing enterprise companies are leveraging data, insights, and software for their revenue operation.

And they are significantly outperforming go-to-market teams early on in their digitization journey. Access to high-quality relevant data provides significant competitive advantages for all sales and marketing organization. We've acquired Dogpatch Advisors to launch ZoomInfo Lab a new go-to-market thought leadership team, driving go-to-market data analysis, product enhancements, and strategy for our enterprise customers. DogPatch is an in-demand go-to-market consultancy with expertise in scaling revenue teams and building a modern sales and marketing system.

Dogpatch has a proven track record of significantly increasing revenue for organizations by modernizing their go-to-market operations and workflow. As part of the acquisition, Ben Salzman, Dogpatch's CEO, will join ZoomInfo to lead ZoomInfo Lab. This will immediately expand our capabilities for enterprises and drive enhancements across our suite of products. Over time, we expect ZoomInfo Lab to put the modern go-to-market playbook within reach of every company.

We continue to innovate and deliver new and improved functionality across our Revel OS platform. In order to better reflect the evolving nature of our solutions for HR recruitment and talent management professionals, and the breadth of the capabilities we offer, we rebranded recruiting or assets TalentOS. We are extremely pleased with the early success we've seen with our TalentOS offering. Both ACV and customer count grew more than 50% compared to Q4, and we've doubled the percentage of our customers using TalentOS from just six months.

Adding Workday, the Chief Cake Factory, Stanford Growth, management recruiters, Redfin, and several leading financial institutions onto the Talents platform to drive their hiring needs. As our customer base continues to grow, we have continued to make investments in a world-class user experience, adding a guided onboarding journey to the platform and launching a new experience for quickly starting a user's first email automation campaign. For our power users, we released advanced boolean search capability as well as an entirely new experience that provides AI-powered similar company recommendation to narrow in on companies to recruit candidates from. Operations OS is powered by our leading data as a service offering and our wine data orchestration platform and is a key lever as we expand within enterprise accounts.

In Q1, we expanded our support for enterprise-scale data and intelligence needs with new large-scale data products, contact data break, hierarchy data brick, and bulk search API. Customers can now build out a complete set of ZoomInfo intelligence directly in the systems they work in. Data bricks are accessible via Snowflake, Google BigQuery, Amazon S3 or SFTP, or Bulk API, enabling integration to any system or workflow. Finally, we announced a partnership with Google Cloud to power businesses with ZoomInfo's data and intelligence in the systems where they work.

Through our integration with Google BigQuery, joint customers can eliminate cumbersome B2B data ingestion processes and get more mileage out of the data in Google Cloud by seamlessly accessing ZoomInfo data and intelligence directly in bid clearing. In February, after months of planning and building, we launched MarketingOS, our new account-based marketing platform built on top of our shared data cloud and designed to give marketers new ways to reach target accounts and drive qualified leads for sales team. Just as we revolutionize the future of selling, our product teams have been working hard to imagine a new platform for marketers. MarketingOS leverages our robust professional and company data.

to allow marketers to execute campaigns throughout the display ad network, social media network, and through marketing and sales automation channel. The ZoomInfo Data Cloud enables marketers to identify and target their highest-value audiences, upload creative assets, sequence relevant messaging across display and social ads and intelligently engage prospects both in their inboxes and beyond. And by leveraging our form complete and chat solution, both originally part of SalesOS less, but now natively configurable and deployable inside of marketing OS marketers increased conversion rates by instantly populating lead form with accurate professional data and by engaging visitors with the right account executives and account managers through real-time chat. Finally, our built-in reporting allows for optimization of ad creative and nurture streams through platform-supported AB testing.

And because of the interoperability of our operating system, marketing and sales teams work from the same data and platform foundation, which tightens key handoffs and unlocks cross-departmental alignment. We acquired Chorus in July of last year, and since then, we have nearly tripled the number of Chorus customers. We are seeing increasingly higher attach rates with both new and existing customers and are now recording, analyzing, and surfacing insights on close to 500,000 meetings each month with core. behind the success on the go-to-market front, are the ongoing development efforts driving category leadership and conversation and revenue intelligence.

In Q1, we introduced DealSignal to help sales teams monitor and manage their deal pipeline. DealSignal surface at-risk deals, allowing a salesperson and their manager to quickly scan what's in the pipeline and easily identify factors that could slow or derail deals. For example, when a deal gets stuck in a certain opportunity stage, our prospects are unusually slow to respond to rep outreach. We also rolled out a new Microsoft Dynamics CRM integration and strengthened our HubSpot CRM integration.

Both now include bidirectional sync with Chorus, which allows our customers to pull information from their CRM into Chorus's pipeline visibility tool Momenta. This allows Chorus users to parse through everything from conversation transcript to how many contacts are engaged to the number of emails flowing between themselves and their prospects. And they can use all of that information to provide better forecasting accuracy and next best actions in the sales cycle. We continue to lead the way on privacy and compliance as it relates to all of our offerings.

And in Chorus, we embedded our patented flow for GDPR-compliant meeting recording into Google calendar. Reps just need a single click to ensure their scheduled meetings are fully compliant and recorded in Chorus, while organizations continue to have the tools to ensure compliance across all their users and meeting. Finally, in a really busy quarter for Chorus, we released a Chorus mobile application on the iOS and Google Play stores which now has thousands of downloads and a 100% five-star rating. At our upcoming Analyst Day, you'll hear even more about the persona-driven approach to our RevOS platform.

where we will share more about the expanding multiproduct adoption and attraction in our emerging product portfolio. Additionally, we will share more about the durability of growth and the efficiency of our model and have a great lineup of human to executives and key customers who will be joining us to share more about their experience is using our platform. Before I wrap up, I wanted to take a moment to acknowledge two of our departing board members, Patrick McCarter and Jason Merino. As Carlisle's and TA's ownership in Zoomin fell has trended down since the IPO, the number of board seats represented by each firm is reduced.

As a result, Patrick and Jason have recently stepped off the board. Jason joined us in 2014 as part of TA Associates investment in the company and was the first investor to see promise in both Zoom Intel and in May. Over the last eight years, I can rely on him for an endless amount of advice and counsel, but mostly first friendship and loyalty. is present at board meetings will be missed, but I expect him to continue to be allowed advocate for our success.

Patrick joined us in 2018 as part of Carlisle's investment and has served as an important mentor and an unrelenting advocate for our growth. Patrick and Bobby, what every founder looks for in a sponsor. He is smart strategic take feedback and has the company's best interest is the focal point of all of his decision. In closing, we continued our strong momentum from 2021 and had a great start to the year.

We're in the earliest stages of activating a large and growing market opportunity, and the team continues to exemplify strong and consistent execution. We are extremely confident in the opportunity ahead. And with that, I'll hand it over to our chief financial officer, Cameron Hauser.

Cameron Hyzer -- Chief Financial Officer

Thanks, Henry. Q1 was another terrific quarter in terms of execution and growth. We outperformed all areas of our guidance and executed well across our portfolio of growth initiatives, including enterprise, international, and emerging advanced functionality on the platform. The demand environment remains strong.

Companies continue to invest behind improving their go-to-market motions and the platform strategy is resonating with customers. We are confident that given the tremendous value we provide to our customers our current narrow level of market penetration that we will be able to drive durable growth regardless of the economic environment. As a result, we are raising our full year guidance for revenue to $1.06 billion to $1.07 billion and adjusted operating income to $418 million to $424 million. At the midpoint, this represents revenue growth of 43% and an adjusted operating income margin of 40%.

For 2022, we expect to deliver more than $1 per share and unlevered free cash flow. In Q1, we delivered GAAP revenue of $242 million, up 58% year over year, which implies 11% sequential growth compared to Q4 2021 as adjusted for days in the quarter. Excluding the impact of products acquired within the last 12 months, organic revenue growth for the quarter was 49%. Adjusted operating income in Q1 was $96 million, a margin of 39%.

With respect to our international business, we are driving strong growth and success for customers outside the U.S. We invested in growing our sales team in London and also committed to further expanding in India and Israel. Revenue from international customers is 12% of total revenue and grew over 80% in Q1 relative to last year. Our investment in the enterprise motion and advanced functionality within our platform continue to drive engagement and growth with our customers.

This is reflected in the addition of more than 150 customers with more than $100,000 in ACV and further penetration of our recently expanded marketing OS and talent OS offerings. Turning to the balance sheet and cash flow. We ended the first quarter with $407 million in cash, cash equivalents, and short-term investments. Operating cash flow in Q1 was $105 million, which included approximately $20 million of interest payments.

Unlevered free cash flow was $126 million for the quarter or 131% of adjusted operating income. We continue to expect that on an annual basis, unlevered free cash flow conversion will be in the range of 100% to 110% as a percentage of adjusted operating income. Following the end of the quarter, we acquired Comparably and Dogpatch Advisors for approximately $145 million in cash, net of cash acquired. We expect these acquisitions to contribute revenue in the low teens millions of dollars in 2022 and create a modest drag on margins of one to two points for the remaining quarters this year.

While these acquisitions are small and will have only a modest impact on our financials in 2022. We expect them to be accretive to growth and operating income in 2023 and forward. With respect to liabilities and future performance obligations, unearned revenue at the end of the quarter was $406 million, and remaining performance obligations, or RPO, were $918 million, of which $715 million are expected to be delivered in the next 12 months. We believe that calculated billings and RPO are imprecise metrics to assess in-period activity and forward momentum.

As a result, we focus on days adjusted sequential revenue growth. We delivered 11% days adjusted sequential revenue growth in the first quarter. At the end of Q1, we carried $1.25 billion in gross debt. With continued growth, we saw an improvement in leverage in the quarter with a net leverage ratio of 2.4 times trailing 12 months adjusted EBITDA and 1.8 times trailing 12 months cash EBITDA, which is defined as consolidated EBITDA in our credit agreements.

We also recently received upgrades from both Moody's and S&P to Ba3 and BB, respectively, for our corporate ratings. Following the launch of our inaugural ESG report, we also received an upgrade from MSCI with our ESG rating upgraded to AA. With that, I will provide our outlook for the second quarter and increased outlook for full year 2022 results. For Q2, we expect GAAP revenue in the range of $253 million to $255 million and adjusted operating income in the range of $98 million to $100 million.

Non-GAAP net income is expected to be in the range of $0.17 to $0.18 per share. Our Q2 guidance implies year-over-year GAAP revenue growth of 46% at the midpoint and an adjusted operating income margin of 39%. We are providing updated full year 2022 guidance as follows: We expect GAAP revenue in the range of $1.06 billion to $1.07 billion, up $50 million from our prior guidance. And adjusted operating income in the range of $418 million to $424 million, up from $410 million at the midpoint of our prior guidance.

We expect non-GAAP income in the range of $0.75 to $0.77 per share based on 411 million diluted weighted average shares outstanding, up from 72 points at the midpoint previously. For unlevered free cash flow, we expect to generate between $435 million to $445 million up from $430 million at the midpoint previously. Our full year guidance implies 43% GAAP revenue growth at the midpoint, up from 36% at the midpoint of our prior guidance. And our full year guidance also implies an adjusted operating income margin of 40% and an unlevered free cash flow margin of 41%.

With that, let me turn it over to the operator to open the call for questions.

Questions & Answers:

Operator

Certainly [Operator instructions]. And our first question comes from Phil Winslow of Credit Suisse. Your line is open.

Phil Winslow -- Credit Suisse -- Analyst

Hey, guys. Thanks for taking my question and congrats on another great quarter. I mean, obviously, you saw a strong organic growth at 49%. But one of the metrics that jumped out, I mean, was the revenue from acquired products over the past 12 months, a $13 million was underscoring some of the comments in you made about ring Chorus I had.

But I guess two questions to follow up on that. What are customers telling you now that you've had RingLead and Chorus inside of ZoomInfo for a couple of quarters now, sort of why they're choosing ZoomInfo and how you kind of differentiate yourself versus the point solutions out there. And then Cameron, One of the questions I get is you continue to expand up the stack in the new personas. How do you think about just sort of unit economics and sales efficiency? Thanks.

Henry Schuck -- Chief Executive Officer and Founder

Thanks, Phil. I think first, customers are out there trying to modernize their go-to-market staff. And so they're out looking for solutions that do lead routing and lead scoring in real time. They're out there looking for a B2B chat for their website.

They're out there looking for conversation intelligence to improve the insights that they have on their sales teams to hear the voice of the customer. And so what -- and they're already customers of ZoomInfo. And so when we have the conversation with them when we're able to tell them and look, you're out there thinking about cobbling together a number of these point solutions that don't talk together that don't work off of a common data foundation that have no synergies in between these solutions. And when you think about the solutions that we provide, they all get better when you embed our data foundation into them.

That gets better because it can route to the right account manager and account executive so that it can surround that account executive with insights on the account that's coming into chat. Conversation intelligence gets better because we can identify when key buyers are missing in the sales cycle and offer them up for a go-to-market motion, lead routing gets better because we can do better assignment and enrichment of leads and accounts as they come in. And so it's really easy to see a future where the data foundation creates the strategic differentiator across all of these different solutions in the platform. And customers are seeing that more and more of them -- and customers of all sizes are seeing that more and more of them are working to digitize their go-to-market motions.

And we're having these really robust conversations with them about taking a platform approach to that.

Cameron Hyzer -- Chief Financial Officer

And Phil, with respect to sales efficiency, naturally, as you're selling more complex solutions, the sales cycles at times can be a little longer. But what we found is that by integrating the conversations with solution that our customers are already taking advantage of and getting real value out of that we're able to compress those sales cycles versus what you might see otherwise. So while sales efficiency might move around a little as we're continuing to invest in different initiatives, whether that's international or enterprise or more complex products, etc, we expect to be able to maintain an industry-leading level of sales efficiency going forward. and to continue to grow our sales and marketing capacity so we can grow sales and marketing our new revenues as well.

Phil Winslow -- Credit Suisse -- Analyst

Great. Thanks. Keep up the great work.

Operator

Our next question comes from Mark Murphy of JPMorgan. Your line is open.

Mark Murphy -- JPMorgan Chase and Company -- Analyst

Yes. Thank you. I'll add my congrats on just a great quarter. Cameron, I was wondering, can you just confirm Dogpatch advisors, is that an aqua hire of something like one to two people.

It looks like it's something kind of small. And then comparably, for Henry, I think of comparably as competing against Glassdoor for kind of the Best Places to Work awards. Is any of their data applicable to generating sales leads? Or is that 100% designed to kind of solidify what you're doing with the HR and recruiter and talent OS product lines?

Cameron Hyzer -- Chief Financial Officer

So I'll hit Dogpatch first. Dogpatch and Comparably are both reasonably small. Dogpatch is a small company, but it was definitely more than an aquihire where they have relationships and a history of really delivering great go-to-market consulting engagements for large clients. So it's a handful of people, but I think that they very much box outside of the class in terms of the value they're able to deliver.

And we think that by bringing that on and being able to deliver those engagements that we'll be able to further accelerate the solutions that we're offering as well.

Henry Schuck -- Chief Executive Officer and Founder

And on Comparably, look, we are very focused on Comparably adding value to our TalentOS platform. That's where we're focused with that acquisition. Now Comparably does a lot more than just the employee review that you see online behind that is a suite of SaaS tools that allows HR and recruiting professionals to easily create content for their careers pages, for their recruiters that allow them to quickly solicit feedback from their employees through Slack and email and easy-to-use survey solutions that they're able to quickly deploy. And so what we see in the marketplace today is the most challenging higher-end environment in history.

And what we hear from our recruiting client and our TalentOS platform clients is that they are struggling to find the right candidates to fill their job role where historically, they could post something on a job board and instantly get candidates. That's not the case anymore. They are out there direct sourcing the candidates they need to be able to reach their goal. And we think the combination of the recruitment marketing and employer branding suite that comparably adds combined with sourcing and engagement and digitization tools that we provide inside of TalentOS makes for a really important solution at a really important time in our hiring history.

Mark Murphy -- JPMorgan Chase and Company -- Analyst

Thank you.

Cameron Hyzer -- Chief Financial Officer

Thanks, Mark.

Operator

And our next question comes from Raimo Lenschow of Barclays. Your line is open.

Raimo Lenschow -- Barclays -- Analyst

Thanks for taking my question. Congrats from me as well. One from me as well. Can I talk a little bit more higher level? I mean, obviously, this year was the year where you have more focus on Europe.

And you kind of talked about the opening of the offices in London, etc. What's the -- is there any impact on the pace of push into Europe from events there? Are you seeing anything? And do you see anything on the U.S. side? In theory, your solution is helping people to get to their clients better. But like any impact from macro on Europe and the U.S.

Thank you and congrats.

Cameron Hyzer -- Chief Financial Officer

Yes. Thanks, Raimo. So we really don't see any impact on Europe at this point or in the U.S. Our customers are almost entirely selling to other businesses and are in most cases, looking for ways to do so more effectively and efficiently.

And I think if anything, in times of stress, historically, you look -- you see that businesses are looking to either take out efficiencies or invest in things that have a faster time to value than other solutions. And I think -- in all cases, our solution helps our customers be more effective, be more efficient. And it's also something that whenever they're adding additional functionality or coming on for the first time, it's something that they see immediate time to value, which makes it a great solution when you see times of stress, whether that's Europe or potentially a broader economic downturn in the U.S.

Raimo Lenschow -- Barclays -- Analyst

Thank you.

Operator

Our next question comes from DJ Hynes with Canaccord. Your line is open.

DJ Hynes -- Canaccord Genuity -- Analyst

Hey. Thank you, guys. Great set of numbers. Henry, so you added a very experienced Chief Compliance Officer back in January.

I know you have a ton of expertise particularly in the U.K. now that Simon's had a quarter-plus under his belt, any -- can you share any observations or recommendations he's made around ZoomInfo privacy practices?

Henry Schuck -- Chief Executive Officer and Founder

Yeah. Look, I think the big thing that we've seen with Simon is, number one, I think access to a network of privacy professionals that we're looking to recruit and bring in to ZoomInfo as well as a real understanding of the compliance and regulatory environment that it's helping us think through how we continue to innovate our privacy posture. And I think the other thing we see is the complicated regulatory environment is not just complicated for us, it's complicated for all of our customers. And so we've been able to leverage Simon's expertise in front of our enterprise customers as they look to navigate the regulatory construct and he has more experience in that than just about anybody else in the world.

And so we're seeing an ability to unlock opportunities internationally because of Simon's expertise in the regulatory environment.

DJ Hynes -- Canaccord Genuity -- Analyst

Perfect. Thank you.

Operator

Our next question comes from Siti Panigrahi of Mizuho. Your line is open.

Siti Panigrahi -- Mizuho Securities -- Analyst

Mizuho. Thank you. Thanks for taking my question. I just want to ask about the customer data more than 100,000.

That's very impressive. [Audio gap] is the cross-sell going within installed base versus getting new customer -- large customer getting multiple products?

Cameron Hyzer -- Chief Financial Officer

So Siti, thanks for joining. You cut out just a little in the middle there. But I think your question was that for those customers that we added that are over 100,000, how much of that is existing customers that are upselling versus customers that are coming on and buying a number of different parts of the platform. As has been historically the case, we tend to land customers with a kind of smaller offering or sometimes a trial and then expand and grow them over time.

So that continues to be the case that we've that most of the customers that we add in that 100,000 are customers that started at a smaller level with us and we've upsell. But there does continue to be momentum in customers coming on over 100,000. Yep. I think last year, we started to see a little bit more momentum, and that's continued in Q1, where a growing number of customers are coming in at 200,000 or 500,000 and then continuing to grow from there as well.

Siti Panigrahi -- Mizuho Securities -- Analyst

Thank you.

Operator

And our next question comes from Michael Turrin of Wells Fargo. Your line is open.

Michael Turrin -- Wells Fargo Securities -- Analyst

Hey there. Thanks. Good afternoon. At margin holding in at the high 30s, again, this -- here in Q1, guidance margins remain somewhere around those levels for the rest of the year.

Cameron, is that a level you're comfortable suggesting you'd expect margins to stabilize around? And then it sounded like the margin delta versus the prior guide is most entirely attributable to some of the M&A you called out but that the growth guide still suggests meaningful increase on an organic basis. Is that a fair characterization or anything else you'd add to just help us compare and contrast the full year outlook of what you last provided? Thank you.

Cameron Hyzer -- Chief Financial Officer

Yeah. Absolutely. So from a margin perspective, certainly, we are focused on the construct that we laid out last year at our Analyst Day, where margins are somewhat inversely correlated to growth. So the faster we grow, the more investment we have upfront into bringing customers on and implementing those customers.

And so at the levels of growth where we're at today, growing organically around 50%. I think the margins that we've laid out and certainly within the guidance or what we'd expect to continue to operate at if we're able to accelerate that growth, then it is possible that margins would come down somewhat. And certainly, as we grow off a larger and larger base and that growth moderates a little. We would expect the margins to drift up.

Michael Turrin -- Wells Fargo Securities -- Analyst

Thank you.

Operator

And our next question comes from Parker Lane of Stifel. Your line is open.

Parker Lane -- Stifel Financial Corp. -- Analyst

Yeah. Hi. Thanks for taking the question. Henry, I wanted to talk about talent OS a little bit here.

Would it be fair to say that the majority of the success you've had there so far has been with customers that have used something like sales OS in the past? And -- are you beginning to see an uptick in the number of organizations that are attracted to ZoomInfo, specifically for TalentOS or Recruiter on a stand-alone basis? Thanks.

Henry Schuck -- Chief Executive Officer and Founder

I think our focus from a go-to-market perspective, Parker, has been focused on the customer base where we already have relationships with the customers. We're already through procurement and privacy and security review where we can accelerate time to the sales cycle within those accounts. That being said, we're also seeing demand from new customers come in as well. And so we feel really good about the way that we're positioned to have those conversations.

And when you think about the breadth of people who are using the solution from everything from the cheap cake factory to Redspin, there's a broad assortment of companies who get value out of that platform. Now the user of TalentOS is obviously not the same user as the sales OS platform. It is a different area in the business. So I wouldn't say that the actual end user was also a user of sales OS but the customers, our focus has been on the customer base today.

Parker Lane -- Stifel Financial Corp. -- Analyst

Very helpful. Thank you.

Operator

And our next question comes from Kash Rangan of Goldman Sachs. Your line is open.

Kash Rangan -- Goldman Sachs -- Analyst

Hey, guys. Congratulations on the quarter. Henry, strategically, when I look at the different pieces of the possible trying to put together talents marketing, sales, operations, etc, it looks like the company is getting a piece of other categories, budgets through overs and marketing talent operations sales previously, you're doing it in a way that is synergistic with your core data platform. Can you talk about how far you can go? And who are the categories that you're gaining share from in each of these domains as you put the pieces of the puzzle together? And if that is successful, how much more upside do you see with our core group of data platform customers, how much can that lead to in terms of ACV multiples relative to where you are with the core product if a customer were to completely buy into all layers of your RevOS? Thank you so much and congrats.

Henry Schuck -- Chief Executive Officer and Founder

It's an interesting question. When we first founded ZoomInfo that we often got the question on the core sort of data and sales OS platform. Where are you taking market who are you taking market from. In reality, we were creating a new market.

where this wasn't a solution that was embedded inside of a sales team or a marketing team or a demand generation team. We were evangelizing that a digital way to go to market have to start with data and insights that came from that data. And so we see -- we continue to see a tremendous greenfield opportunity in the sales of the platform. If you think about conversation intelligence, you can take a look at that space.

We nearly tripled the number of customers in that space. We're not displacing somebody. We're making the go-to-market motion more efficient and people are willing to make an investment, essentially a small investment to get a high return on that investment by optimizing the way that they go to market. You see that same thing in talent recruiters when you go inside of a corporation, the recruiting department tends to reach out to candidates and the same way today as they did a decade ago or a decade before that.

It's incredibly bespoke. They use job board, they're not directly sourcing. They're not engaging with candidates in digital ways. They're not using SMS and email and calling and website chat to bring customers in candidates in and give them a personalized experience.

And so when we go into a recruiting department, we're not displacing another budget, where significant -- we're making that motion significantly more efficient. You can spend $45,000 on an outplacement recruiter to find an executive talent for you or a senior director or manager talent for you. or you can spend a fraction of that with ZoomInfo to get your team up and online and running after that opportunity. And so you're making that motion more efficient.

And so our customers are much more willing to invest and these solutions to make their ultimate motion more efficient without having to displace something that exists today.

Cameron Hyzer -- Chief Financial Officer

And I think when we think about the ACV or the potential for growth within our customers. Certainly, it's early days with the MarketingOS and even with the OperationsOS at this point. But we have customers where the value proposition that we're able to provide in marketing and operations, in some cases, can be greater than even what they're deriving from the SalesOS. So we have customers that are actually spending more on those particular parts of the platform than they are just on sales.

So I think when we look at the opportunity to expand within our customers that we could expand by multiples of what we're currently earning for just the SalesOS, where that's the only thing that's deployed.

Kash Rangan -- Goldman Sachs -- Analyst

And retention would improve to arguably, right? So that's the good news.

Cameron Hyzer -- Chief Financial Officer

Retention definitely improves as our customers are using more advanced functionality. We already see that there is a significant level of retention improvement for those customers as well.

Kash Rangan -- Goldman Sachs -- Analyst

Thanks, gentlemen.

Operator

And our next question comes from Keith Weiss of Morgan Stanley. Your line is open.

Elizabeth Porter -- Morgan Stanley -- Analyst

Hi. This is Elizabeth Porter on for Keith Weiss. Thank you so much. I was hoping to get an update on the government opportunity.

What is on the uptake of being able to purchase in through the GSA schedule how should we think about monetizing that opportunity? Thanks.

Henry Schuck -- Chief Executive Officer and Founder

Yes. I think the way to think about it today is that we're in really early days of that opportunity. We are seeing good momentum as we come out as we've come out with an offering for the government and through the GSA schedule. But it's really early days in that opportunity.

Lots of promise, and we've stated the team to go after that opportunity, but it's still really early days.

Elizabeth Porter -- Morgan Stanley -- Analyst

Got it. Thank you.

Operator

And our next question comes from Alex Zukin of Wolfe Research. Your line is open.

Alex Zukin -- Wolfe Research -- Analyst

Hey, guys. Thanks for taking the question. Congrats on a great quarter. I guess maybe -- just at a high level, you talked about the demand environment, not really seeing much of an impact from all the macro factors.

If I isolate that to the large deal environment and we called out that deal with Alphabet, there was eight figures. How should we think about the pipeline for those types of engagements, not necessarily figure, but just large deals. How do you think about that pipeline this year given the demand? And then maybe for Cameron, for the last, I want to say, four quarters, I think. I know they're in perfect metrics, but I believe the calculated billings as we're not ahead of current RPO and current RPO bookings.

And that slipped this quarter were current RPO and current RPO bookings are growing faster than the billings on the P&L. Any sense for why that would be? Or anything to call out there would be helpful.

Cameron Hyzer -- Chief Financial Officer

So if we start on the pipeline, I'll just jump in real quick. Realistically, the macro factors, if you isolated into to kind of areas, one being, obviously, the conflicts in Eastern Europe and the second being fears of a potential recession. We don't see any impact on our large deals. Realistically, we don't do much business in Eastern Europe historically, and that's not kind of one of the primary areas where we're focusing right now.

So large deals are unimpacted by that. And certainly, in terms of any potential recession or recession thoughts, I think for larger deals, those are customers that are leaning in even harder to being more efficient and more effective. So I think that those sorts of customers are more likely to focus on where they can get quick time to value, and that's something that I can imagine even accelerating sales cycles around that as opposed to decelerating because our system is so focused on that quick time to value and generating efficiency and effectiveness for go-to-market motions. On the billings and bookings discussion, I think it's worth pointing out that if you look at the ratio of billings to bookings, Q1 of last year, so Q1 of 2021 was actually, by far, the highest ratio of bookings to billings or the ratio of billings to bookings, sorry.

And that largely related to when we came out of COVID, there was like a deferral of some of our bookings and certainly more of our bookings were done quarterly in like Q2 and Q3 of 2020 than they had been historically. So that's just another one of those levels of noise where bookings and billings can be imperfect metrics when you're looking at growth. And certainly, the compare in Q1 of 2021, I think, distorts that the kind of growth figures that you'd otherwise be looking at.

Alex Zukin -- Wolfe Research -- Analyst

Perfect. Thank you, guys.

Operator

Our next question comes from Rishi Jaluria of RBC. Wonderful. Your line is open.

Rishi Jaluria -- RBC Capital Markets -- Analyst

Wonderful. Thanks so much for taking my questions and nice to see continued strengthen the business. Just a simple one in terms of geography. So you're expanding your presence in Europe.

You opened up your first office in India. I want to get a sense for how do you think about the opportunity, especially in emerging markets? Because it seems pretty obvious, the G7 or the natural adjacency -- but hoping up in India, it seems like a completely different base. Maybe can you walk us through how you're thinking about that international opportunity and specifically in emerging markets? Thanks.

Henry Schuck -- Chief Executive Officer and Founder

Yeah. I think as it relates to India, the bulk of the talent we have there is around customer success, support, product management, and engineering. And so the India opportunity we see as one that can help us more manage time zones across the world with customer success and support and product which interfaces the product engineering teams interface with our Israel R&D operation than it is from a go-to-market perspective. Today, from a go-to-market perspective, we think the London office as well as in the future, potentially Australia, New Zealand, time zone, and geography makes sense for us.

Rishi Jaluria -- RBC Capital Markets -- Analyst

Great. Thank you.

Operator

Thank you. Our next question comes from Koji Ikeda of Bank of America. Your line is open.

Koji Ikeda -- Bank of America Merrill Lynch -- Analyst

Hey, Henry. Hey, Cameron. Thanks for taking my question. I wanted to build upon a prior question about TalentOS with its potential for being a primary land and actually kind of shifting it over to MarketingOS here.

So clearly, a new product, I understand that, but it has some unique features in there. It has account-based marketing. It has an ad tech DSP. I mean, are you also seeing inbound demand for marketing OS as a stand-alone basis? And if you are, maybe you could share what are some of the pain points that those customers are looking to try and solve it the Zoom infill marketing OS.

Henry Schuck -- Chief Executive Officer and Founder

Yeah. Great question. We are seeing inbound demand for marketing OS from an outbound perspective, we are still focused on our existing customer base for that where we have existing relationships with sales and often marketing. Many of our customers on the SalesOS platform are using it for marketing-related audience building or marketing automation campaign, form completion enrichment.

And so we already have a; bulk of a big amount of our customers who are from the marketing department. And so what we've done is go out to them, show them the expanded capabilities of the marketing OS platform and we're getting more and more of them to sign up for that. We do believe when we have these conversations, one of the first things we hear is, look, we spend a lot of time building high-value audiences to deploy through marketing automation to deploy through our sales team and our outbound efforts and we'd love to have a way to build an audience and deploy through the display ad networks and to deploy through the social media network. And our solution because it's built on this 150 million professional profiles across 150 million company profile, we were able to let marketers build a B2B audience inside of ZoomInfo.

And then deploy that audience across the display ad network across the social media network. So now you're getting business and buyer persona targeting within the display ad networks. We think that's new. We think that's differentiated.

And we know that the reason why we're able to provide that in a significantly differentiated way is because of the data asset that we're leveraging against. And now every marketer can easily build an audience, say, VP of IT at healthcare companies within California, Nevada, and Oregon and start putting ads against that specific persona across the display ad networks, across the social media network. That's incredibly powerful. It's turnkey and marketers haven't had the ability to do that because no one's built a platform like this on top of the data foundation that we have.

Got it. Thanks, Henry. Thanks so much.

Operator

Our next question comes from Taylor McGinnis of UBS. Your line is open.

Taylor McGinnis -- UBS -- Analyst

Yeah. Hi. Thanks for taking my question. So a question on the margin outlook.

It seems like a good portion of the outperformance is coming from Chorus, Engage, TalentOS, and some of the newer opportunities. So as these pieces become a bigger portion of the mix, Cameron, is there anything to keep in mind from potential impact or differences in the margin structure of some of these at the early stage?

Cameron Hyzer -- Chief Financial Officer

And certainly, one of the pieces around the acquisitions that we've done is taking companies that have less of a focus on sales efficiency and putting them into our model, where we're able to generate incremental sales on a much more efficient basis. So I think that what we see, if you think about the margin kind of outlook going forward is that from some of those earlier acquisitions, they'll continue to become a little bit more efficient as they're kind of more deeply integrated into the model, but then we have newer acquisitions where we need to, again, go through that process of realizing some of that synergy and kind of integrating into the platform where we're able to get those faster sales cycles running as well. So I think that the construct that we've laid out before, where at a 40-ish kind of type of growth rate, which is where we were around when we went public, we'd be able to deliver margins in those kind of mid-40s extended the acquisitions. I think we're very comfortable with that.

And obviously, at the levels that we're growing now stepped up levels, we expect margins to continue in the kind of high 30s, low 40s. And as we grow off that larger and larger base and growth rates start to moderate a little, but we'll see those margins drift back up over time.

Taylor McGinnis -- UBS -- Analyst

Great. Thanks.

Henry Schuck -- Chief Executive Officer and Founder

Thank you.

Operator

Our next question comes from Brent Bracelin of Piper Sandler. Your line is open.

Brent Bracelin -- Piper Sandler -- Analyst

Good afternoon. I guess, Henry, Cameron, great to hear companies like Alphabet, Shopify leading into the platform, I guess, at a high level, the vision to move up into apps from just the core data layer seems to be resonating -- my question here is if you just think about this quarter biggest dollar beat operating profits that you've seen since the IPO, really strong cash flows. -- what is the appetite to do more on M&A, particularly given valuations in cloud software are much lower today, are you seeing more M&A opportunities? Are there bigger M&A opportunities Clearly, the strategy is resonating? I love to get any thoughts on what the appetite here is given the momentum you have. Thanks.

Henry Schuck -- Chief Executive Officer and Founder

Yeah. Thank you for the question. I think layering on to what Cameron just finished saying. We feel really good about our ability to take various technologies, integrate them with our data and then take them to market as a proven way to grow.

Today, we have a really clear vision for how we want our platform to evolve. We're doing content analysis around that vision around build, buy, or partner to achieve that vision. We understand the ecosystems across our four personas. And if we see something that matches our vision and the criteria that we've laid out around M&A, you'll see us take a close look.

Cameron Hyzer -- Chief Financial Officer

And Brent, I'd probably layer on to that. One of the secrets about being really good at M&A is being disciplined and making sure that it meets the criteria that we've set up historically. And so we plan to continue that. I think valuations, I think, in the public markets have certainly come down, but sometimes it takes a little while for private valuations to fully mirror the reality that kind of come to be.

So while there are opportunities out there, we're more focused on just meeting our kind of core criteria than we are on where valuations are moving or anything else.

Brent Bracelin -- Piper Sandler -- Analyst

Got it. Makes sense. Thanks. Helpful color.

Operator

Now, the last question comes from Brian Peterson of Raymond James. Your line is open.

Unknown speaker -- Raymond James -- Analyst

This is Chase on for Brian. Just one from our side. Can you guys elaborate on the announcement of the ZoomInfo Labs. I'm understanding kind of the aggregation integration, but just obviously think about the tire customer there.

And then how you guys see the ramping operations to meet the broader demand in the market? Thanks.

Cameron Hyzer -- Chief Financial Officer

Yes. I think -- so the launch of ZoomInfo Labs is coming off of the acquisition of Dogpatch Advisers. And Dogpatch Advisors is professional services and consultancy firm that helps enterprises build out their go-to-market efforts using data and insights and software to make those go-to-market efforts incredibly effective and efficient. And so when we talk with our customers and our prospects, what they're telling us is they want a world where their go-to-market motions are driven by data where our software is interconnected seamlessly, where they have the ability to run innovative sales playbook but they don't have a pathway to get there.

And so what we're hopeful to do with ZoomInfo Lab is to provide a mechanism to help our customers see a future that's innovative, that's data-driven, where systems are integrated and talk to each other where our data cloud sits at the foundation of that and our application layer drives the interconnectivity of that motion. And so the Dogpatch Advisors acquisition, which turns into ZoomInfo Labs here at ZoomInfo is designed to help our customers not only see that vision, but then also achieve that.

Unknown speaker -- Raymond James -- Analyst

All right. Thanks.

Operator

I would now like to turn the conference back to Mr. Henry Schuck for closing remarks.

Henry Schuck -- Chief Executive Officer and Founder

Great. Thank you, everyone. We hope that you can join us virtually for the Analyst Day on June 2nd at 3:00 p.m. Eastern.

We're excited to share more with you about our platform approach and our leading combination of both growth and profitability. Thank you.

Operator

[Operator signoff]

Duration: 62 minutes

Call participants:

Jerry Sisitsky -- Investor Relations

Henry Schuck -- Chief Executive Officer and Founder

Cameron Hyzer -- Chief Financial Officer

Phil Winslow -- Credit Suisse -- Analyst

Mark Murphy -- JPMorgan Chase and Company -- Analyst

Raimo Lenschow -- Barclays -- Analyst

DJ Hynes -- Canaccord Genuity -- Analyst

Siti Panigrahi -- Mizuho Securities -- Analyst

Michael Turrin -- Wells Fargo Securities -- Analyst

Parker Lane -- Stifel Financial Corp. -- Analyst

Kash Rangan -- Goldman Sachs -- Analyst

Elizabeth Porter -- Morgan Stanley -- Analyst

Alex Zukin -- Wolfe Research -- Analyst

Rishi Jaluria -- RBC Capital Markets -- Analyst

Koji Ikeda -- Bank of America Merrill Lynch -- Analyst

Taylor McGinnis -- UBS -- Analyst

Brent Bracelin -- Piper Sandler -- Analyst

Unknown speaker -- Raymond James -- Analyst

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