The 31st-ranked American got the only service break of the match in the third game of the second set and converted his first match point with a two-handed backhand winner. The loss rules out a possible final for Zverev against top-seeded Roger Federer, who part owns the agency which manages the sixth-ranked German's career.
The defeat also harms Zverev's chances of defending his ATP Finals title next month. He is seventh in the season-long standings to advance to the eight-man event in London. In Federer's half of the draw, third-seeded Stefanos Tsitsipas and fifth-seeded Fabio Fognini both advanced Tuesday.
Tsitsipas beat Albert Ramos-Vinolas 6-3, 7-6 (6) and Fognini eased past qualifier Alexei Popyrin 6-2, 6-4. Federer next plays Wednesday against Radu Albot, after the 49th-ranked Moldovan won 2-6, 6-3, 6-4 against Dusan Lajovic.
In a match of zero break point chances, 37th-ranked Reilly Opelka beat No. 38 Cristian Garrin 7-6 (5), 7-6 (10). The 22-year-old American had 27 aces in his victory and dropped only one point when landing his first serve.
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