Consumer Confidence Falls 7%, Yet Economic Activity Remains Resilient; Financial Services Surges While Travel and Tech Face Headwinds

Zeta Global (NYSE: ZETA), the AI Marketing Cloud, today released the Zeta Economic Index (ZEI) for February 2025. Powered by Zeta's proprietary Generative AI technology and real-time consumer behavior from over 245 million US consumers, the ZEI provides a unique perspective on the resilience and trajectory of the U.S. economy.

The Economic Index Score (EIS), the ZEI's primary measure of US economic health, stands at 70.3, reflecting a 0.8% month-over-month (MoM) decrease. Despite this modest pullback, economic stability remains intact, with the Economic Stability Index (ESI) at 66.9, marking a 0.6% quarter-over-quarter (QoQ) improvement.

This divergence between consumer sentiment and economic activity is particularly striking. Consumer confidence dropped nearly 7%, exceeding economists' expectations, amid inflation concerns and policy changes. Yet, spending behavior remains robust, suggesting that while Americans feel uncertain, their behavior remains broadly unchanged so far. The job market is also showing resilience, with the U.S. Bureau of Labor Statistics (BLS) reporting stronger job growth in November, December, and January than the entire year prior.

“While consumer sentiment has softened, actual economic activity remains steady, which is consistent with similar patterns in the past,” said David A. Steinberg, Co-Founder, Chairman, and CEO of Zeta Global. “The ZEI’s ability to track real-world behavior, rather than just stated perceptions, gives businesses a critical edge in understanding market dynamics. Despite ongoing uncertainty, the data reveals an economy that continues to adapt and expand.”

Additional highlights from the February 2025 ZEI:

• Consumer Credit Dynamics Signal Economic Confidence: Despite cautious discretionary spending (-0.4% MoM), Credit Line Expansion Intent rose 146.4% YoY with a 2.3% MoM rise, suggesting consumers remain willing to leverage credit to maintain lifestyles amid inflationary pressures, indicating an underlying confidence in future economic stability.
• Job Market Sentiment Rebounds: After January's sharp decline, Job Market Sentiment rose 26.7% MoM to reach a 6-month high, reflecting renewed optimism in the private sector despite ongoing adjustments in public sector employment.
• Financial Services Outperforms: In February, Financial Services emerged as the standout performer (+2.3 points MoM), driven by deregulation efforts to make the U.S. a global leader in digital assets and expectations of eased regulatory scrutiny.
• Technology Sector Navigates Spending Uncertainty: Technology declined 3.0 points MoM as big tech stocks underperformed amid reassessment of AI infrastructure investments.
• Travel and Entertainment Weaken: The travel sector experienced the largest decline (-5.7 points MoM), affected by post-holiday seasonality, rising airfare costs, and new travel requirements like REAL ID implementation. Entertainment also declined (-3.3 points MoM) as consumers shift priorities toward savings and essential purchases.

The Zeta Economic Index (ZEI) leverages Generative AI to analyze trillions of behavioral signals, recalibrating each month to reflect real-time consumer activity. Unlike traditional surveys, ZEI derives insights from over 20 proprietary inputs, offering an unparalleled view of economic sentiment, trends, and spending patterns.

The Zeta Economic Index is publicly available here and is provided as a complimentary service. It should not be considered investment advice or be relied upon to make investment decisions.

About Zeta Global

Zeta Global (NYSE: ZETA) is the AI Marketing Cloud that leverages advanced artificial intelligence (AI) and trillions of consumer signals to make it easier for marketers to acquire, grow, and retain customers more efficiently. Through the Zeta Marketing Platform (ZMP), our vision is to make sophisticated marketing simple by unifying identity, intelligence, and omnichannel activation into a single platform – powered by one of the industry’s largest proprietary databases and AI. Our enterprise customers across multiple verticals are empowered to personalize experiences with consumers at an individual level across every channel, delivering better results for marketing programs. Zeta was founded in 2007 by David A. Steinberg and John Sculley and is headquartered in New York City with offices around the world. To learn more, go to www.zetaglobal.com.

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