Zeta Global Holdings Corp. (ZETA) saw its stock price plummet 5.15% in pre-market trading on Monday, as investors reacted to recent analysis highlighting the company's profitability challenges. The sharp decline comes as market observers raise concerns about Zeta's financial performance and growth strategy.

A recent report from StockStory has placed Zeta on a list of "Unprofitable Stocks Walking a Fine Line," citing several key issues that may be contributing to investor unease. The report points out that Zeta's net revenue retention rate of 97.1% indicates difficulties in customer retention, a crucial factor for sustainable growth in the software and data analytics industry.

Furthermore, the analysis reveals that Zeta's gross margin of 60.4% falls below that of its competitors, potentially limiting the company's ability to invest in critical areas such as marketing and research and development. The report also suggests that Zeta's rapid expansion strategy has come at the expense of operating profitability, raising questions about the sustainability of its current business model. As investors digest these concerns, the pre-market sell-off reflects growing caution surrounding Zeta's stock.