Financial Results Announcement - GoDaddy Inc. will release its financial results for the first quarter of 2025 on May 1, 2025, after the U.S. stock market closes [1] - Following the news release, GoDaddy management will host a live webcast at 5:00 p.m. Eastern Time [1] Webcast Information - A recording of the webcast will be available on GoDaddy's Investor Relations website after its completion [2] Company Overview - GoDaddy assists millions of entrepreneurs globally in starting, growing, and scaling their businesses [3] - The company offers services such as naming ideas, building websites and logos, selling products and services, and accepting payments [3] - GoDaddy Airo®, an AI-powered experience, helps small businesses get online quickly, drive traffic, and boost sales [3] - Expert guides are available 24/7 to provide assistance to users [3]

Core Insights - GoDaddy (GDDY) shares have returned 51% over the trailing 12 months, significantly outperforming the broader Zacks Computer & Technology sector's 7% and the Zacks Internet - Delivery Services industry's 37.1% [1] - The outperformance is attributed to GoDaddy's expanding AI-powered portfolio and strong performance in the Application and Commerce segment, which generated $441.2 million in Q4 2024, accounting for 37% of total revenues and reflecting a year-over-year growth of 16.9% [2] Group 1: Performance Metrics - GDDY shares have outperformed industry peers such as QuinStreet (QNST), MakeMyTrip (MMYT), and Asure Software (ASUR), which returned 9.4%, 48.5%, and 24.3% respectively over the same period [1] - The Zacks Consensus Estimate for Q1 2025 revenues is $1.19 billion, indicating a growth of 7.21% compared to the previous year [11] Group 2: AI Integration and Product Development - GoDaddy has made significant advancements in integrating AI into its portfolio, particularly with the GoDaddy Airo platform, which has gained traction with 50% of paid subscriptions originating from Airo's experience [5][6] - The launch of Airo Plus, an upgraded version of Airo, has enhanced customer engagement and monetization capabilities [7] - GoDaddy's marketing efforts, including a Super Bowl ad for Airo, have increased customer interest and engagement [8] Group 3: Future Guidance and Market Position - For Q1 2025, GoDaddy expects revenues between $1.175 billion and $1.195 billion, with Application and Commerce revenue growth anticipated in the mid-teens [10] - GoDaddy's stock is currently trading at a premium with a forward Price/Sales ratio of 5.11X compared to the industry average of 1.84X, indicating a stretched valuation [12] Group 4: Competitive Landscape and Challenges - GoDaddy faces intense competition from companies like Newfold Digital, Namecheap, and Shopify, which poses a threat to its market share [14] - Macroeconomic challenges, including high interest rates and inflation, may negatively impact GoDaddy's prospects, particularly as its clientele consists mainly of small and medium-sized businesses [15]

Financial Performance - Total revenue for the year ended December 31, 2023, was $4,573.2 million, representing a 7.5% increase on a reported and constant currency basis[22]. - International revenue reached $1,459.8 million, an increase of 5.7%, or approximately 5.8% on a constant currency basis[22]. - Total bookings amounted to $5,038.8 million, reflecting a 9.5% increase, or approximately 9.7% on a constant currency basis[22]. - Operating income increased to $893.5 million, a significant rise of 63.2%[22]. - Net income for the year was $936.9 million, a decrease of 31.9% compared to the previous year[22]. - Normalized EBITDA was reported at $1,395.9 million, an increase of 23.0%[22]. - Total revenue increased by 8% to $4,573.2 million in 2024, driven by a 16% increase in Applications and Commerce revenue[336]. - NEBITDA for 2024 was $1,395.9 million, up from $1,134.5 million in 2023, reflecting a significant increase in operational performance[333]. - Total bookings rose by 9.5% to $5,038.8 million in 2024, attributed to strong customer adoption of productivity solutions and pricing initiatives[338]. - Net income for the year ended December 31, 2024, was $936.9 million, a decrease of 31.9% from $1,375.6 million in 2023[333]. Customer Metrics - Total customers at period end were 20,511 thousand, a decrease from 21,026 thousand in the previous year[327]. - Average revenue per user (ARPU) increased to $220, up from $203 in the previous year[327]. - Domains under management totaled 81,013 thousand, down from 83,554 thousand in the previous year[327]. Cash Flow and Investments - Net cash provided by operating activities was $1,287.7 million, marking a 22.9% increase[22]. - Net cash provided by operating activities increased by $240.1 million from $1,047.6 million in 2023 to $1,287.7 million in 2024, driven by strong adoption of A&C products and lower restructuring payments[369]. - Net cash provided by investing activities improved by $123.9 million, from a net cash used of $102.4 million in 2023 to a net cash provided of $21.5 million in 2024[371]. - Net cash used in financing activities decreased by $584.3 million from $1,261.7 million in 2023 to $677.4 million in 2024, primarily due to a reduction in share repurchases[372]. - Cash and cash equivalents increased significantly to $1,089.0 million in 2024 from $458.8 million in 2023, marking a growth of 137.5%[433]. Expenses and Costs - Cost of revenue increased by 5% to $1,652.0 million in 2024, driven by growth in domain registration and productivity applications[340]. - Technology and development expenses decreased by 3% to $814.4 million in 2024, due to lower personnel costs and reduced legal and professional fees[342]. - Marketing and advertising expenses increased by 1% to $356.9 million in 2024, primarily due to increased discretionary advertising spend[344]. - General and administrative expenses rose by 5% to $394.2 million in 2024, mainly due to higher stock-based compensation and legal costs[348]. - Restructuring and other expenses decreased by 57% to $39.4 million in 2024, reflecting a significant reduction in severance and related costs[349]. - Interest expense decreased by 11.6% to $158.3 million in 2024, resulting from refinancing activities that reduced the interest margin[353]. Equity and Stockholder Information - The total stockholders' equity increased to $692.1 million in 2024 from $62.2 million in 2023, a significant rise of 1006.5%[433]. - The company repurchased shares for an aggregate price of $668.1 million in 2024, with $767.4 million remaining for future repurchases[378][379]. - The company repurchased 17,356 thousand shares of Class A common stock for $1,272.9 million during the year ended December 31, 2022[441]. - The balance of retained earnings as of December 31, 2023, was $(2,320.7) million, reflecting a decrease from $(2,422.6) million in the previous year[441]. Revenue Recognition and Accounting Policies - Revenue is recorded on a gross basis when the company acts as a principal, and on a net basis when acting as an agent, with specific criteria determining the classification[384]. - The company completed a series of transactions on December 11, 2023, resulting in Desert Newco becoming a wholly-owned subsidiary, simplifying its capital structure[395]. Debt and Financing - Total borrowings under the 2031 Term Loans were $995.0 million as of December 31, 2024, with an amortization rate of 1.00% per annum[410]. - Total borrowings under the 2029 Term Loans were $1,458.9 million as of December 31, 2024, also with an amortization rate of 1.00% per annum[411]. - The company entered into interest rate swaps with a notional amount of $1,222.7 million as of December 31, 2024, converting variable-rate borrowings under the 2029 Term Loans to a fixed rate of 4.81%[413]. Impairment and Foreign Currency - The company recognized an immaterial non-cash impairment charge for certain indefinite-lived intangible assets during 2024, following a qualitative assessment indicating potential impairment[393]. - The company manages foreign currency risk through foreign exchange forward contracts and cross-currency swaps, with a notional amount of €1,146.9 million (approximately $1,187.4 million) as of December 31, 2024[406]. - The effect of a hypothetical 10% change in foreign currency exchange rates would not have had a material impact on the company's cash and cash equivalents[403]. Comprehensive Income - The company reported a comprehensive income of $958.2 million for 2024, down from $1,307.6 million in 2023, a decrease of 26.7%[438].

Core Insights - GoDaddy Inc. will have its CEO Aman Bhutani and CFO Mark McCaffrey present at the Morgan Stanley Technology, Media & Telecom Conference on March 3, 2025 [1] - The presentation will be available via live audio webcasts and post-presentation audio replays on GoDaddy's investor relations website [1] Company Overview - GoDaddy assists millions of entrepreneurs worldwide in starting, growing, and scaling their businesses [2] - The company offers services such as domain naming, website building, logo creation, product sales, and payment processing [2] - GoDaddy Airo®, an AI-powered experience, aims to expedite the process of getting small businesses online and enhancing sales [2] - Expert guides from GoDaddy are available 24/7 to provide assistance to users [2]

Core Insights - GoDaddy's research indicates that small businesses are significantly contributing to job creation and economic growth through the use of AI tools like GoDaddy Airo, with measurable impacts observed in local economies [2][3][8] Group 1: Job Creation - For every website published using GoDaddy Airo, 20 jobs are created per county, with rural counties seeing an average of 4.2 jobs and urban counties experiencing a boost of 22 jobs [10] - The introduction of 10 new GoDaddy published websites per county is associated with a 0.017 percentage-point reduction in unemployment rates [10] Group 2: Economic Impact - GoDaddy Airo has led to a 43% increase in sales for small businesses and a 21% increase in traffic when a logo is added [4][10] - Microbusiness website activity surged to an all-time high in 2024, with GoDaddy's engagement index growing by 13% from January to September, surpassing pre-pandemic records [10][11] Group 3: Productivity and Revenue Growth - Among small business owners using AI tools like GoDaddy Airo, 72% reported increased productivity, and 61% reported higher revenues in the last six months [10] Group 4: Barriers to Entry - The number of websites published surged since the release of AI tools like Airo, although 38% of microbusiness owners cited a lack of knowledge about AI, indicating a need for education in 2025 [10]

Core Viewpoint - GoDaddy's stock experienced a significant decline following the release of its Q4 2024 financial results, despite reporting revenue growth that exceeded expectations [1][2]. Financial Performance - For Q4 2024, GoDaddy's revenue grew by 8% year over year to $1.2 billion, surpassing the expected growth of 7% [2]. - The company's full-year earnings per share (EPS) were reported at $6.45, which was a decline from the previous year, primarily due to a substantial tax benefit in 2023 that inflated profits [3]. - Analysts had anticipated a slightly higher EPS, contributing to the negative market reaction [3]. Stock Valuation - Over the past year, GoDaddy's stock has increased by 62%, while its price-to-sales (P/S) valuation rose by 48%, indicating that the stock's gains were largely driven by heightened investor expectations [4]. - Following the unmet expectations, the stock price experienced a crash, reflecting a recalibration of investor sentiment [4]. Future Outlook - Management projects a free cash flow of approximately $1.5 billion for 2025, suggesting a valuation of about 17 times those expectations, which is considered reasonable if the company can sustain growth [5]. - GoDaddy anticipates achieving annual top-line growth of 6% to 8% over the next few years, alongside improvements in profitability, which are viewed as achievable given the company's market position [6].

Core Insights - GoDaddy reported fourth-quarter 2024 earnings of $1.42 per share, missing the Zacks Consensus Estimate by 2.74%, but showing a 31.5% increase year-over-year from $1.08 [1] - The company generated revenues of $1.2 billion, exceeding the Zacks Consensus Estimate by 1.38%, with an 8.4% year-over-year increase [2] - GoDaddy's strong performance was driven by sustained customer demand and strategic initiatives, including optimized pricing and bundling strategies [3] Financial Performance - Applications and Commerce (A&C) segment revenues reached $441.2 million, contributing 37% to total revenues, and increased 16.9% year-over-year [4] - The Core Platform revenues were $751.4 million, contributing 63% to total revenues, with a 3.9% year-over-year increase [4] - International revenues were $380.4 million, up 7.5% year-over-year [5] - Total bookings increased 8.8% year-over-year to $1.2 billion, while Average Revenues Per User (ARPU) rose 8.4% to $220 [5] Operating Results - Normalized EBITDA for the fourth quarter was $384.7 million, reflecting a 32.3% year-over-year increase, with an expanded EBITDA margin of 280 basis points [6] - Operating income increased 34.6% year-over-year to $255.6 million, with an operating margin expansion of 420 basis points to 21.4% [7] Balance Sheet & Cash Flow - As of December 31, 2024, GoDaddy had cash and cash equivalents of $1.1 billion, up from $767.1 million as of September 30, 2024 [8] - Total debt remained unchanged at $3.9 billion, while free cash flow for the fourth quarter was $342 million [8] Guidance - For Q1 2025, GoDaddy expects revenues between $1.175 billion and $1.195 billion, indicating a year-over-year growth of 7% at the mid-point [9] - The company anticipates A&C revenue growth in the mid-teens and Core revenue growth in the low-single digits for Q1 [9] - For the full year 2025, total revenues are expected to be between $4.86 billion and $4.94 billion, with a normalized EBITDA margin expansion of 100 basis points [10]

Group 1 - GoDaddy Inc. reported weaker-than-expected earnings for Q4, with earnings of $1.36 per share, missing the analyst consensus estimate of $1.43 per share [1] - The company achieved quarterly sales of $1.192 billion, surpassing the analyst consensus estimate of $1.179 billion [1] - GoDaddy's CEO highlighted strong operational execution and financial performance in 2024, with plans to innovate around GoDaddy Airo and enhance their integrated technology platform for 2025 [2] Group 2 - For Q1, GoDaddy anticipates revenue between $1.175 billion and $1.195 billion, compared to estimates of $1.186 billion [2] - Following the earnings announcement, GoDaddy shares increased by 2.4%, closing at $212.54 [3] - Analysts adjusted their price targets for GoDaddy, with Piper Sandler raising it from $176 to $177 and Morgan Stanley from $227 to $228, while maintaining their ratings [4]

© 2025 GoDaddy Inc. © 2025 GoDaddy Inc. Q4 2024 Earnings Results February 13, 2025 Thea Monyeé THEAMONYEE.COM Forward-looking statements and non-GAAP financial measures This presentation contains forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on estimates and information available to us at the time of this presentation and are not guarantees of future performance. Statements in this presentation i ...

Financial Data and Key Metrics Changes - GoDaddy reported total revenue growth of 8% for the full year 2024, reaching $4.6 billion, with normalized EBITDA margin expanding to 31%, an increase of nearly 400 basis points year-over-year [26][28][19] - Free cash flow grew 25% to $1.4 billion, exceeding guidance, while unlevered free cash flow for the year increased 20% to $1.5 billion [29][19] - In Q4 2024, total revenue was $1.2 billion, exceeding guidance, with normalized EBITDA margin expanding to 32% [21][22] Business Line Data and Key Metrics Changes - Applications and commerce (A&C) segment revenue grew 17% to $441 million, driven by strong performance across products including website plus marketing and managed WordPress [22][23] - Core platform segment revenue grew 4% to $751 million, with bookings also increasing by 4% [23][24] - A&C bookings grew 17%, while core platform bookings rose 4% [22][23] Market Data and Key Metrics Changes - Annualized gross payment volume (GPV) increased 55% to $2.6 billion, indicating strong growth in the commerce initiative [10] - The company expects revenue growth in the US to outpace international growth by approximately 200 basis points due to currency headwinds [36] Company Strategy and Development Direction - GoDaddy's strategy focuses on creating customer value and transforming it into shareholder value through better conversion, attach, and retention [3] - The company is targeting significant contributions to growth from pricing and bundling initiatives in 2025, particularly in presence products and specific customer populations within the hosting business [7][48] - The Aero initiative is seen as a key driver of future growth, with plans to enhance customer experience and engagement through AI and new product offerings [12][18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to customer growth in 2025, driven by high-value customer acquisition and improved retention rates [32][56] - The company anticipates modest financial benefits from the Aero experience in the near term, with a focus on long-term growth [38] - Management highlighted the importance of maintaining operational discipline while pursuing innovation and customer engagement [40][41] Other Important Information - GoDaddy exited 2024 with $1.1 billion in cash and total liquidity of $2.1 billion, with net debt at $2.8 billion [33] - The company plans to maintain a disciplined approach to capital allocation, including covering dilution from share-based compensation through buybacks [44][45] Q&A Session Summary Question: Can you elaborate on the pricing and bundling strategy for 2025? - Management indicated that the focus will be on presence products and specific customer cohorts, emphasizing a customer cohort-based approach rather than a product-centric one [48][52] Question: What are the drivers for returning to customer growth in 2025? - Management highlighted the focus on high-quality customers and the positive signs from the Aero initiative, which is expected to improve customer engagement and retention [56][58] Question: Are there any one-off headwinds impacting revenue growth? - Management acknowledged that while bookings momentum is strong, there are transactional aspects that could impact revenue recognition, particularly in the aftermarket business [66][134] Question: What is the expected impact of the Aero initiative on monetization? - Management noted that Aero is entering the monetization phase earlier than planned, with positive metrics on customer engagement and retention [78][81] Question: How does the company view the growth potential of GPV? - Management expressed optimism about GPV growth, indicating that there is still significant room for penetration within the customer base [85][86] Question: What are the expectations for EBITDA margin in 2025? - Management projected a normalized EBITDA margin expansion of approximately 100 basis points, with continued focus on A&C growth contributing to this [41][157]