Bond.az - Jefferies downgraded ZoomInfo Technologies (NASDAQ:ZI) to Hold from Buy on Thursday and cut its price target to $4.00 from $12.00, citing weak client demand and changing customer behavior driven by artificial intelligence adoption.
The stock currently trades at $3.67, hovering near its 52-week low of $3.65, with shares down 61% over the past year.
Analyst Surinder Thind said the firm has materially reduced its outlook for revenue growth in 2026 and does not expect conditions to improve in 2027. Client demand has been weak for two years, and AI has begun to penetrate enterprise workflows in ways that negatively impact purchasing decisions.
Clients have started to prefer building their own workflows and analytics around ZoomInfo's data rather than subscribing to the company's software. Management has begun transitioning clients from a subscription-based model to a usage-based model.
The transition is expected to take 12 to 18 months and lead to revenue declines in the near term. Jefferies said it prefers to move to the sidelines until it has better visibility on the transition and its likelihood of succeeding.
The firm said it does not foresee a catalyst that would take the shares materially higher from current levels despite the stock's correction.
