GoDaddy GDDY reported third-quarter 2024 earnings of $1.32 per share, beating the Zacks Consensus Estimate by 5.6% and jumping 48.3% year over year.
GDDY generated revenues of $1.15 billion, surpassing the Zacks Consensus Estimate by 0.4%. Revenues increased 7.3% year over year on a reported and constant-currency (cc) basis.
GoDaddy shares gained more than 1% in the pre-market trading. Shares have increased 52.2% year to date compared with the Zacks Computer & Technology sector’s return of 28.4%.
GDDY’s Quarterly Performance
Applications and Commerce (A&C), comprising Websites and Marketing, Managed WordPress, Productivity Applications, and Payments and Commerce, generated $423.1 million (contributing 36.9% to total revenues), up 16.5% on a year-over-year basis.
GoDaddy Inc. Price, Consensus and EPS Surprise
GoDaddy Inc. price-consensus-eps-surprise-chart | GoDaddy Inc. Quote
Core Platform, consisting of domains, aftermarket, hosting, and security, increased 2.6% year over year to $724.5 million (contributing 63.1% to total revenues).
International revenues in the third quarter reached $369.4 million, up 6.9% year over year on a reported and cc basis.
Total bookings of $1.2 billion increased 9% year over year and 9.4% on a cc basis.
Average revenues per user were $215, up 7.5% year over year.
Total annualized recurring revenues (ARR) were $3.97 billion, up 8.1% year over year. In the reported quarter, Applications & Commerce ARR was $1.6 billion, up 15% year over year. Core platform ARR totaled $2.4 billion and moved up 4% year over year.
Total customers at the end of the third quarter were 20,725, down 1.4% year over year.
GDDY’s Operating Results
On a non-GAAP basis, normalized EBITDA in the third quarter was $366.5 million, up 23.8% year over year. The normalized EBITDA margin expanded 420 basis points (bps) year over year.
Operating expenses (technology and development, marketing and advertising, customer care, and general and administrative) of $453.2 million declined 0.5% year over year. As a percentage of revenues, operating expenses contracted 310 bps year over year to 39.5%.
Operating income was $253.8 million, up 51.9% year over year. The operating margin expanded 650 bps year over year to 22.1%.
GoDaddy’s Balance Sheet & Cash Flow
As of Sept. 30, 2024, cash and cash equivalents were $767.1 million compared with $444.9 million as of June 30, 2024.
As of Sept. 30, 2024, GoDaddy had a total debt of $3.9 billion, unchanged sequentially.
The free cash flow was $362.7 million compared with the previous quarter’s $323.4 million.
In the third quarter, GoDaddy repurchased 5.2 million shares of its common stock for an aggregate purchase price of $668.1 million.
GoDaddy’s Guidance Positive
For the fourth quarter of 2024, GoDaddy expects revenues of $1.165-$1.185 billion, indicating year-over-year growth of 7% at the mid-point.
The company expects fourth-quarter A&C revenue growth in the mid-teens and Core revenue growth in the low single digits.
For the fourth quarter, GDDY anticipates a normalized EBITDA margin of 31%.
For 2024, GoDaddy expects total revenues of $4.545-$4.565 billion, indicating year-over-year growth of 7% at the mid-point.
The company expects full-year A&C revenue growth in the mid-teens and Core revenue growth in the low-single digits.
The normalized EBITDA margin for the year is expected to be 30%.
For 2024, GoDaddy anticipates a free cash flow of at least $1.325 billion.
Zacks Rank & Other Stocks to Consider
GDDY currently carries a Zacks Rank #2 (Buy).
Applied Optoelectronics AAOI, CommScope COMM and Fair Isaac FICO are some better-ranked stocks that investors can consider in the broader sector, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Applied Optoelectronics shares have declined 15.3% year to date. AAOI is set to report third-quarter 2024 results on Nov. 7.
CommScope shares have gained 146.5% year to date. COMM is set to report third-quarter 2024 results on Nov. 7.
Fair Isaac shares have risen 72.4% year to date. FICO is set to report third-quarter 2024 results on Nov. 6.
5 Stocks Set to Double
Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.
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CommScope Holding Company, Inc. (COMM) : Free Stock Analysis Report
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GoDaddy Inc. (GDDY) : Free Stock Analysis Report
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