GODADDY INC (GDDY) Q1 2026 Earnings Call Transcript
Neutral Software - Infrastructure 12.61B USA
Next Earnings
2026-04-29
GoDaddy posted 2025 results above guidance, advanced AI initiatives (Airo.ai and ANS), and issued 2026 guidance with continued margin expansion and strong free cash flow, while note near-term bookings headwinds from GTM changes.
⭐ Key Highlights
GoDaddy delivered 2025 annual results above guidance
Full-year revenue grew 8% with normalized EBITDA margin expanding to 32% and free cash flow up 19%, driven by AI-driven efficiencies and operational execution.
AI journey advancing with Airo.ai and ANS
Airo.ai beta expanded to 25 live agents handling tasks across the entrepreneurs wheel; ANS integration with MuleSoft validates enterprise adoption and monetization potential in the agentic economy.
Go-to-market evolution impacts near-term bookings
Shift to higher-intent, 1-year terms increased new customer units but reduced upfront bookings and near-term revenue; management projects bookings growth to trail revenue in Q1 2026 with parity expected by year-end.
Website builder upgrade and product momentum
Significant upgrade to Websites + Marketing with an AI-powered website builder expected to accelerate attach and activation; early adopters are being opted in.
2026 guidance reinforces durable cash generation
2026 target revenue $5.195-$5.275 billion (~6% growth), normalized EBITDA margin >33%, and free cash flow about $1.8 billion, supported by margin expansion and AI-driven productivity.
✔Positive Signals
- 5/25: Airo.ai beta with 25 live agents delivering early monetization and efficiency gains
- ANS integration with MuleSoft validating enterprise adoption of agentic identity
- Full-year 2025 gross margin expansion and strong free cash flow generation
- Go-to-market shift attracting high-intent customers and higher attach in the long term
- 2026 guidance shows margin expansion and durable, cash-generative model
✖Negative Signals
- Near-term bookings headwinds from GTM evolution and .CO expiration
- Q4 A&C bookings deceleration partly due to discount allocation across products
- Go-to-market transition creating a temporary mix shift that weighs on early 2026 bookings
- AI-related costs remain a focal point; need to monitor margin impact as AI investments scale
📊Financial Results
- Q4 total revenue $1.3 billion, up 7% YoY, at the high end of guidance
- Full-year normalized EBITDA $1.6 billion, margin 32%, 150 bp expansion
- Full-year free cash flow $1.6 billion, +19% YoY, with FCF/normalized EBITDA > 1:1
- Bookings of $1.3 billion in Q4 with 5% QoQ growth; A&C bookings +11% in full year
- Net debt $2.7 billion, net leverage 1.6x; cash and liquidity $1.1B and $2.1B respectively
🔮Future Guidance
- Full-year revenue guidance of $5.195–$5.275 billion (~6% growth at midpoint)
- Normalized EBITDA margin to exceed ~33% for the year
- Free cash flow of about $1.8 billion with >1:1 conversion
- Q1 2026 revenue guide of $1.25–$1.27 billion (~6% growth) and EBITDA margin ~32%
- Bookings expected to be ahead of revenue for the year, though Q1 could see relative weakness due to GTM changes and .CO effects
💡Interesting Insights
- Agent Name Service (ANS) leveraging DNS infrastructure could unlock a new layer of global digital identity monetization beyond domains
Detailed Analysis
AI-generated summary of GODADDY INC earnings call transcript.
GoDaddy reported 2025 revenue of about $1.3 billion in Q4, up 7% year over year, with ARR at $4.3 billion and international growth of 10%. Applications & Commerce revenue grew 13% with solid attach, while Core Platform grew 3%. Normalized EBITDA margin rose by 150 basis points to 32% for the year, and free cash flow rose 19% to $1.6 billion. Management highlighted AI progress through Airo.ai (25 live agents in beta) and ANS, plus a stronger domain-led GTM with a 1-year domain offer that boosted new customer acquisition but pressured near-term bookings due to upfront discount allocation. For 2026, guided revenue of $5.195–$5.275 billion (~6% growth), normalized EBITDA margin >33%, and free cash flow around $1.8 billion, with Q1 revenue of $1.25–$1.27 billion and a 32% expected quarterly EBITDA margin. The company expects bookings to lag revenue in early 2026 due to GTM changes and .CO expiration, but projects parity by year-end as attach and renewals strengthen.
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