ZoomInfo Technologies (GTM) reduced its workforce and shifted to consumption-based pricing, but execution risk around a material re-acceleration in top-line growth persists, while the lower full-year 2026 guidance is discouraging, RBC Capital Markets said in a note emailed Tuesday.

The company announced nearly 20% workforce reduction, which is expected to generate $60 million in annualized operating expense savings, at a one-time cost of $45 million to $60 million to be incurred in Q2 and Q3. Management believes this restructuring will help margins reach nearly 40% over time, according to the note.

The brokerage said management noted a regression in growth near the end of Q1, driven by a pause in purchasing due to "AI and agentic confusion" as customers faced build versus buy decisions.

The Q2 guidance for revenue and non-GAAP operating income was below consensus, while non-GAAP earnings per share were in-line. ZoomInfo also lowered its full-year 2026 guidance, which is now below consensus across all metrics except EPS, according to the note.

RBC kept an underperform rating on ZoomInfo Technologies and lowered the price target to $4 from $7.

Shares of the company were down more than 33% in Tuesday trading.

Price: 4.05, Change: -2.00, Percent Change: -33.03