Zeta Global (ZETA) Tumbles as AI Dreams Turn to Nightmares

We recently published 10 Stocks Crash as AI Glow Fades. Zeta Global Holdings Corp. (NYSE:ZETA) is one of Wednesday’s worst performers.

Zeta Global Holdings Corp. (NYSE:ZETA) dropped for a second day on Wednesday, shedding 4.42 percent to end at $18.17 apiece as investors unloaded positions in Artificial Intelligence companies amid concerns about a bubbling industry.

This followed OpenAI CEO Sam Altman’s comments over the weekend that an “AI bubble is forming” amid the increased spending in the industry.

“When bubbles happen, smart people get overexcited about a kernel of truth,” Altman was quoted as saying in an interview with reporters.

“Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes. Is AI the most important thing to happen in a very long time? My opinion is also yes,” he added.

Altman appeared to compare such a dynamic to the infamous dot-com bubble, a stock market crash centered on internet-based firms that led to a massive investor enthusiasm during the late 1990s.

Between 2000 and 2002, the tech-heavy Nasdaq wiped out nearly 80 percent of its value after many of the companies failed to generate revenues and profits.

Zeta Global Holdings Corp. (NYSE:ZETA), an AI-powered marketing cloud, saw its net loss in the second quarter of the year narrow by 54 percent to $12.8 million from $28.1 million in the same period last year. Revenues grew by 35 percent to $308 million from $227.8 million year-on-year.

While we acknowledge the potential of ZETA as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.