Release Date: May 01, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• GoDaddy Inc (GDDY, Financial) reported an 8% growth in bookings and expanded normalized EBITDA margin to 31%, with a 26% growth in free cash flow.
• The company achieved a 17% revenue growth in its A&C segment, driven by strong adoption of subscription solutions.
• GoDaddy Inc (GDDY) successfully completed its $4 billion 2022 share repurchase authorization, reducing its fully diluted shares outstanding by over 25%.
• The company launched high-margin offerings such as GoDaddy Capital and same-day payouts, which are gaining traction.
• GoDaddy Inc (GDDY) reaffirmed its full-year 2025 outlook, expecting total revenue growth of 7% and a free cash flow target of at least $1.5 billion.

Negative Points

• The macroeconomic environment, including tariffs, remains a concern, although GoDaddy Inc (GDDY) claims limited direct exposure.
• Customer sentiment shows some pressure, with small businesses expressing concerns about the economic outlook.
• The company is still in the early stages of testing its Airo Plus SKU, with no significant metrics to report yet.
• GoDaddy Inc (GDDY) experienced a dip in gross margins, attributed to product mix variations.
• The digital marketing suite remains small, with no significant updates on its performance or contribution to revenue.

Q & A Highlights

Q: How is GoDaddy handling macroeconomic changes and small business sentiment? A: Amanpal Bhutani, CEO, noted that while there is some pressure on small business sentiment, GoDaddy's customer base remains resilient and optimistic about their own performance. The value of GoDaddy's products is significantly higher than their cost, which positions the company well to navigate macroeconomic challenges.

Q: Can you provide insights on the early performance of Airo Plus and its target customers? A: Amanpal Bhutani, CEO, explained that Airo Plus is still in early testing stages but is showing promising results in improving order size and product attachment. Airo Plus is targeted at customers who are already engaged with Airo, offering them an expanded set of features at a competitive price.

Q: How is GoDaddy's pricing and bundling strategy performing, and what are the future plans? A: Amanpal Bhutani, CEO, stated that the pricing and bundling initiative is a multiyear program that is currently delivering ahead of expectations. The company continues to test new bundles and pricing options, focusing on creating value for customers and minimizing churn.

Q: What is the outlook for GoDaddy's customer growth and gross margin expansion? A: Mark McCaffrey, CFO, emphasized that GoDaddy's strategy focuses on attracting higher intent customers rather than sheer customer growth. The company expects to return to customer growth later in the year as it laps previous divestitures. Gross margin expansion is driven by favorable product mix and operational efficiencies.

Q: How is GoDaddy leveraging AI, particularly with Airo and agentic AI? A: Amanpal Bhutani, CEO, highlighted that Airo's automation capabilities are being enhanced with agentic AI, which will allow micro businesses to deploy AI agents to perform tasks across different products. This development aims to further simplify operations for customers and enhance their experience.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.