When it comes to web hosting and domain registration, GoDaddy stands out as a major player in the industry. The company’s latest financial results for Q3 of 2024 highlight its progress in various areas, from increased revenue and profitability to innovative new tools for small business owners. These results are encouraging for both investors and customers, showing a clear focus on growth and financial strength.
Solid growth in revenue and profit
In Q3 2024, GoDaddy reported a revenue of $1.15 billion, marking a 7% increase from the same period last year. The Applications & Commerce (A&C) division, which provides tools like e-commerce platforms, saw a significant growth of 16%, reaching $423.1 million. This segment now has an annual recurring revenue (ARR) of $1.6 billion, a 15% increase from the previous year. Meanwhile, the Core Platform, which covers traditional hosting and domains, grew by 3%, with revenues totaling $724.5 million and an ARR of $2.4 billion.
GoDaddy also delivered a strong performance in terms of profit. Net income for Q3 reached $190.5 million, up 45% from the $131 million reported in Q3 2023. The earnings per share (EPS) increased from $0.89 to $1.32, surpassing analysts’ estimates of $1.23. This rise in income indicates GoDaddy’s successful focus on cost control and improved margins.
Challenges in the aftermarket segment
Despite these positive figures, not all aspects of GoDaddy’s business grew this quarter. Its aftermarket segment, which involves the resale of domains, saw a slight decline. Revenue from this area was $106 million in Q3, down from $112 million in Q2 2024 and $107 million in Q3 2023. While GoDaddy anticipates aftermarket revenue to improve over the year, some challenges, like losing access to Huge Domains’ inventory, might impact its performance in this segment.
Strong cash flow and future outlook
One of the highlights of GoDaddy’s Q3 report is its cash flow strength. Operating cash flow increased by 26%, reaching $355.2 million, while free cash flow grew by 29% to $362.7 million. These results enable GoDaddy to continue investing in growth initiatives and share buybacks, as it repurchased 5.2 million shares year-to-date, spending approximately $668.1 million.
Looking forward, GoDaddy projects Q4 revenue between $1.165 and $1.185 billion and anticipates Applications & Commerce growth to remain strong. For the full year, the revenue forecast is set at $4.545-$4.565 billion. GoDaddy’s AI-driven Airo platform, which helps customers set up websites and manage businesses, is expected to contribute further to both revenue and customer satisfaction.
GoDaddy’s Q3 results showcase the company’s strong performance, with significant growth in both revenue and profitability. Although there are some challenges in its aftermarket business, GoDaddy’s advancements in Applications & Commerce and innovations like the Airo platform reinforce its position as a leader in the web services industry. For entrepreneurs and investors, GoDaddy remains a key company to watch as it continues to grow and adapt in the digital age.
