Web Hosting Firm GoDaddy Posts $1.04 bn in Q2 2023 Revenue with 3.2% Growth

Internet domain registrar and web hosting company GoDaddy has reported robust financial results for the second quarter ending June 30, 2023, with a revenue of $1.048 billion, showing a 3.2 percent growth compared to the same period last year.
GoDaddy India businessThe revenue breakdown for the quarter showcased different performances across GoDaddy’s business segments. The Applications & Commerce division proved to be a significant contributor, generating $351.7 million, a substantial 10.9 percent increase year-over-year. On the other hand, the Core Platform brought in $696.4 million, experiencing a slight 0.3 percent decline compared to the previous year. Meanwhile, the International Business segment generated $341.1 million, reflecting a steady growth of 3.1 percent.

GoDaddy CEO, Aman Bhutani, expressed enthusiasm about the company’s latest achievements, stating, “For the first time, we can bundle domains with an increasing array of AI-powered capabilities that help small businesses quickly overcome administrative burdens, attract new customers, and focus on growth.”

The company’s efforts in incorporating artificial intelligence into its services are evident in their product lineup. GoDaddy has introduced generative AI tools into Websites + Marketing, which assists micro-businesses in managing their online stores by auto-generating product descriptions, customer service messages, and social media ads on platforms like Instagram and Facebook.

Additionally, GoDaddy launched GoDaddy.AI, a free online resource, providing customers with tips and the latest news on generative AI for small businesses, further showcasing the company’s commitment to supporting entrepreneurs.

The financial highlights also showcased GoDaddy’s successful implementation of AI-powered tools, as evidenced by the rise in Annualized Recurring Revenue (ARR) for its Applications and Commerce business, which increased by 10 percent year-over-year, reaching $1.3 billion in the second quarter. The Create + Grow suite of website builders, under this business segment, grew to $465 million in ARR, an impressive 11 percent year-over-year growth, reflecting an upward trajectory from Q1.

GoDaddy’s Commerce offerings have shown promising results as well. Gross payments volume (GPV) continued to experience strong growth and is projected to double the 2022 GPV by the end of this year. Gross merchandise volume (GMV) totaled $33 billion in the second quarter, marking a remarkable 20 percent increase compared to the previous year.

Despite a flat year-over-year performance in ARR for the Core Platform, which totaled $2.3 billion in the second quarter, GoDaddy remains optimistic about its future business outlook. In February 2023, the company announced a restructuring plan aimed at reducing operating expenses and improving cash flows through a combination of a reduction in force and selling certain assets. As part of this plan, GoDaddy recently closed the sale of non-core hosting brands, incurring a net pre-tax loss on disposal of $16.8 million.

Looking ahead, GoDaddy aims to sustain its growth momentum in the third quarter ending September 30, 2023, targeting total revenue in the range of $1.055 billion to $1.075 billion, representing a 3 percent year-over-year growth at the midpoint. Additionally, the company sets its sights on achieving a Normalized EBITDA margin of approximately 26 percent for both the third quarter and the full year ending December 31, 2023.

GoDaddy’s ongoing efforts in integrating artificial intelligence into its services are expected to continue driving innovation and empowering small businesses around the world.