Summary of Conference Call Notes Industry Overview - **Industry**: North America Application Software - **Focus**: Digital Intelligence and Lead Generation Tools Company Insights SimilarWeb Ltd. (SMWB) - **Rating**: Buy / High Risk - **Target Price**: Reduced from $13 to $11, current price at $8.36 as of July 31, 2025 [2][7] - **Web Traffic**: Login page visits declined 13% YoY in Q1 and 15% YoY in Q2, indicating a concerning trend [8][17] - **Management Tone**: Mixed signals from management regarding growth prospects; slight improvement in pipeline confidence noted [8] - **Investment Needs**: Increased investment required in R&D and product development to stay competitive in the rapidly evolving SEO and AI GEO landscape [7][8] - **Hiring Trends**: Job openings in R&D and Sales & Marketing have increased slightly in July, but overall hiring capacity has pulled back [8][9] - **Revenue Growth Estimates**: FY25 total revenue growth projected at 14%, slightly below consensus of 14.6% [9] ZoomInfo Technologies (GTM) - **Rating**: Sell / High Risk - **Target Price**: Maintained at $8, current price at $10.83 as of July 31, 2025 [3][30] - **Platform Engagement**: Customer engagement metrics (total visits and unique visitors) are weak compared to competitors like Apollo, which is experiencing growth [3][30] - **Net Revenue Retention (NRR)**: Stands at 85%, one of the lowest in the software sector, indicating potential customer churn issues [3][30] - **Hiring Activity**: ZoomInfo's hiring remains cautious, contrasting with Apollo's aggressive hiring plans [30][41] - **Market Outlook**: Competitive pressures are expected to persist, with a weaker medium-term outlook due to decelerating growth metrics [30][68] Key Financial Metrics - **SimilarWeb**: - Q2 login page visits down 15% YoY - Target price adjusted to $11 based on moderated growth estimates [2][7] - **ZoomInfo**: - Q2 login page visits down approximately 11% - Target price remains at $8 with unchanged estimates [3][30] Risks and Considerations - **SimilarWeb**: High risk due to recent IPO status and volatility in high-growth software stocks; potential for re-rating based on execution against growth plans [64][65] - **ZoomInfo**: High risk due to deteriorating growth metrics and competitive pressures; downside risks include challenges in customer acquisition and market penetration [70][71] Conclusion - Both companies face significant challenges in the current market environment, with SimilarWeb showing potential for recovery if it can adapt to competitive pressures and ZoomInfo struggling with engagement and retention issues. The investment outlook remains cautious for both, with specific attention needed on their respective growth strategies and market conditions.