GoDaddy(US:GDDY)2025-02-13 23:02Financial Data and Key Metrics Changes - GoDaddy achieved a top line bookings growth of over 9% and expanded normalized EBITDA margin to 31% for the full year [6][14] - The company reported a 25% increase in free cash flow for the year, reaching $1,400,000,000 [14][19] - Annual revenue grew 8% to $4,600,000,000, with normalized EBITDA increasing 23% to $1,400,000,000, representing a 31% margin [18][19] Business Line Data and Key Metrics Changes - Applications and Commerce (A&C) segment revenue grew 17% to $1,700,000,000, with bookings also increasing by 17% [16][18] - Core platform segment revenue grew 4% to $2,900,000,000, with bookings rising 4% [16][18] - A&C segment EBITDA margin improved to 47%, while core platform segment EBITDA margin expanded to 34% [16] Market Data and Key Metrics Changes - Annualized gross payment volume (GPV) increased 55% to $2,600,000,000, indicating strong growth in the commerce initiative [9][18] - The company reported a customer base of 20,500,000, reflecting a strategic focus on high-value customers [19][20] 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 [5][14] - 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][10] - GoDaddy Aero is viewed as a key driver of future growth, with plans to expand its capabilities and customer engagement [10][11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in returning to customer growth in 2025, driven by enhanced value propositions and strategic focus on high lifetime value customers [19][24] - The company anticipates total revenue growth of 7% for 2025, with A&C revenue growth in the mid-teens and core platform growth in low single digits [23][24] - Management highlighted the importance of maintaining operational discipline and pursuing opportunities for further leverage through technology and AI [25][26] Other Important Information - GoDaddy exited the year with $1,100,000,000 in cash and total liquidity of $2,100,000,000, with net debt at $2,800,000,000 [22] - The company plans to maintain a disciplined capital allocation approach, focusing on shareholder returns and evaluating all opportunities [26] Q&A Session Summary Question: Can you elaborate on the pricing and bundling strategy for 2025? - Management indicated excitement about the pricing and bundling program, which exceeded expectations in 2024, and plans to focus on presence products and customer cohorts in 2025 [33][35] Question: What are the drivers for returning to customer growth in 2025? - Management emphasized the focus on high-quality customers and the positive signs in the sales funnel, indicating a strategy that prioritizes high-value customers over sheer volume [39][40] Question: Any headwinds affecting revenue growth expectations for 2025? - Management acknowledged potential impacts from foreign exchange and the transactional business, which could affect revenue recognition timing [46][91] Question: What is the expected contribution from the ARROW initiative? - Management expects modest impacts from the ARROW launch in 2025, with a focus on attracting higher-value customers and enhancing their initial experience with GoDaddy [48][50] Question: Can you provide insights on the renewal rates for the Aero cohorts? - Management noted improvements in renewal rates for customers engaged with Aero, attributing this to the added value and multiple product interactions available through the Aero experience [77][78]