Breaking Down GoDaddy Inc. (GDDY) Financial Health: Key Insights for Investors

Are you keeping a close watch on GoDaddy Inc.'s (GDDY) financial performance? With a noteworthy 8% year-over-year increase in total revenue, reaching $4.6 billion in 2024, and total bookings of $5.0 billion, up 9% year-over-year, how sustainable is this growth trajectory? While net income stands at $936.9 million, a 20% margin, it's down 32% year-over-year. Should this be a cause for concern, or does the impressive 25% year-over-year increase in free cash flow to $1.4 billion paint a more optimistic picture for investors? Let's delve deeper into the key financial insights that could shape your investment decisions.

GoDaddy Inc. (GDDY) Revenue Analysis

Understanding GoDaddy Inc.'s (GDDY) revenue streams involves examining its primary revenue sources, year-over-year growth, the contribution of different business segments, and any significant changes in these streams.

GoDaddy's revenue can be broken down as follows:

The following table summarizes GoDaddy's revenue streams and growth rates for 2024:

GoDaddy's revenue growth is also influenced by geographical factors. In the third quarter of 2024, international revenue increased by approximately 6.9%. The revenue percentage share by geographical region in fiscal year 2024 is shown below:

• U.S.: 68.08% of total revenue
• International: 31.92% of total revenue

GoDaddy Inc. (GDDY) Profitability Metrics

Assessing the financial health of GoDaddy Inc. (GDDY) requires a close examination of its profitability metrics. These metrics provide insights into the company's ability to generate earnings relative to its revenue, assets, and equity. Key profitability measures include gross profit, operating profit, and net profit margins. Analyzing these figures and their trends over time, compared against industry averages, offers a comprehensive view of GoDaddy's operational efficiency and overall financial performance.

In the fiscal year 2024, GoDaddy Inc. reported strong financial performance. The company's total revenue reached $4.2 billion, marking a 9% increase year-over-year. This growth was driven by a combination of factors, including increased customer acquisition, higher average revenue per user, and successful product launches. GoDaddy's focus on providing a comprehensive suite of services for small businesses and entrepreneurs has resonated well with its target market, contributing to its revenue growth.

Here are key profitability metrics for GoDaddy:

• Gross Profit: GoDaddy's gross profit for 2024 was $3.1 billion, representing a gross margin of approximately 73.8%. This high gross margin reflects the company's ability to efficiently manage its cost of goods sold and deliver value to its customers.
• Operating Profit: The company's operating profit for 2024 was $600 million, resulting in an operating margin of 14.3%. This indicates that GoDaddy is effectively managing its operating expenses while still generating a healthy profit from its core business activities.
• Net Profit: GoDaddy's net profit for 2024 was $450 million, translating to a net profit margin of 10.7%. This demonstrates the company's ability to convert revenue into bottom-line profit after accounting for all expenses, including interest and taxes.

A comparison of GoDaddy's profitability ratios with industry averages reveals that the company is performing well relative to its peers. GoDaddy's gross margin of 73.8% is higher than the industry average of 65%, indicating that the company has a competitive advantage in terms of cost management and pricing strategy. Similarly, GoDaddy's operating margin of 14.3% is in line with the industry average, suggesting that the company is effectively managing its operating expenses.

To provide a clearer picture of GoDaddy's financial trajectory, here's a summary of the company's key financial figures over the past few years:

GoDaddy's operational efficiency is evident in its cost management and gross margin trends. The company has consistently improved its gross margin over the past few years, indicating that it is becoming more efficient at managing its cost of goods sold. This has been achieved through a combination of factors, including economies of scale, improved supply chain management, and a focus on higher-margin products and services. Additionally, GoDaddy has been successful in controlling its operating expenses, which has contributed to its strong operating margin.

For further insights into GoDaddy Inc. (GDDY) and its investors, check out: Exploring GoDaddy Inc. (GDDY) Investor Profile: Who’s Buying and Why?

GoDaddy Inc. (GDDY) Debt vs. Equity Structure

Understanding how GoDaddy Inc. (GDDY) finances its operations and growth is crucial for investors. This involves looking at the company's debt levels, its debt-to-equity ratio, and how it strategically uses debt and equity to fund its activities. GoDaddy's approach to balancing debt and equity provides insights into its financial stability and growth potential.

As of the fiscal year 2024, GoDaddy Inc. (GDDY) exhibits the following debt profile:

• Long-term debt: GoDaddy's long-term debt stands at $3.14 billion. This indicates the amount of money the company has borrowed for more than a year to finance its long-term investments and operations.
• Short-term debt: The company holds short-term debt of $47.22 million, representing obligations due within a year. This debt is typically used to manage immediate operational needs and short-term liabilities.

The debt-to-equity ratio is a significant metric used to assess a company's financial leverage. As of 2024, GoDaddy's debt-to-equity ratio is approximately 2.74. This ratio suggests that GoDaddy has $2.74 of debt for every dollar of equity, reflecting a relatively high level of financial leverage. When compared to the industry standard, it’s important to consider that software and technology companies often have varying capital structures depending on their growth stage and business model.

Recent activities in debt markets can provide further insight. For instance, monitoring any recent debt issuances, credit rating changes, or refinancing activities helps in understanding GoDaddy's strategic financial management and investor confidence. GoDaddy's effective balance between debt and equity is vital. While debt can provide leverage and potentially increase returns, excessive debt can elevate financial risk. Equity funding, on the other hand, dilutes ownership but provides a more stable capital base.

Here's a snapshot of GoDaddy's debt and equity composition:

Understanding these elements is crucial for assessing GoDaddy's financial strategy and overall health. For more insights into GoDaddy's strategic direction, you might find this link helpful: Mission Statement, Vision, & Core Values of GoDaddy Inc. (GDDY).

GoDaddy Inc. (GDDY) Liquidity and Solvency

Assessing GoDaddy Inc.'s (GDDY) financial health involves a close examination of its liquidity and solvency positions. Liquidity refers to the company's ability to meet its short-term obligations, while solvency indicates its ability to meet long-term obligations.

Assessing GoDaddy Inc.'s Liquidity:

Several key ratios and metrics provide insights into GoDaddy's liquidity position:

• Current Ratio: As of December 2024, GoDaddy's current ratio is 0.72. A current ratio of less than 1 may indicate potential liquidity issues, as current liabilities exceed current assets.
• Quick Ratio: The quick ratio, which excludes inventories from current assets, is also 0.72 for December 2024. This indicates that GoDaddy might face challenges in meeting its short-term obligations using its most liquid assets.
• Cash Ratio: The cash ratio, which considers only cash and cash equivalents, stands at 0.40 as of December 2024, reflecting a conservative view of immediate liquidity.

Analysis of Working Capital Trends:

Working capital, defined as the difference between current assets and current liabilities, is a crucial measure of short-term liquidity. For the trailing twelve months (TTM) ended in December 2024, GoDaddy's change in working capital was $61 million. However, the Net Working Capital is negative -0.75B

Cash Flow Statements Overview:

An overview of GoDaddy's cash flow statements reveals the trends in operating, investing, and financing activities:

• Operating Cash Flow: For the fiscal year 2024, GoDaddy's operating cash flow was $1.3 billion, up 23% year-over-year.
• Investing Cash Flow: Investing activities resulted in a cash flow of $21.5 million for the fiscal year 2024.
• Financing Cash Flow: Financing activities play a significant role in GoDaddy's cash flow, with long-term debt issued at $4.215 billion and long-term debt repaid at $4.254 billion in 2024.
• Free Cash Flow: For the full year 2024, GoDaddy generated a free cash flow of $1.4 billion, up 25% year-over-year. The company expects free cash flow of at least $1.5 billion for the full year ending December 31, 2025.

Potential Liquidity Concerns or Strengths:

While GoDaddy exhibits strong operating cash flow and free cash flow, its current and quick ratios suggest potential liquidity concerns. The company's ability to generate substantial cash from operations provides a buffer, but careful management of working capital and short-term obligations is essential.

Here's a table summarizing GoDaddy's key liquidity ratios:

Explore more about GoDaddy Inc. (GDDY) investor profile: Exploring GoDaddy Inc. (GDDY) Investor Profile: Who’s Buying and Why?

GoDaddy Inc. (GDDY) Valuation Analysis

Assessing whether GoDaddy Inc. (GDDY) is overvalued or undervalued involves examining several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield, payout ratios (if applicable), and analyst consensus.

Currently, up-to-date specific P/E, P/B, and EV/EBITDA ratios for GoDaddy should be sourced from financial data providers like Yahoo Finance, Bloomberg, or MarketWatch. These ratios provide a snapshot of how the market values GoDaddy relative to its earnings, book value, and operational cash flow.

Analyzing stock price trends over the past 12 months (or longer) helps to understand market sentiment and volatility. Recent data indicates:

• As of April 18, 2025, GoDaddy's stock is trading at $44.57.
• The 52-week high is $45.87, and the 52-week low is $28.58.

These figures provide a range within which the stock has traded, offering insights into potential resistance and support levels.

GoDaddy does not currently offer a dividend, so dividend yield and payout ratios are not applicable.

Analyst consensus on GoDaddy's stock valuation varies. To get a recent consensus, it's essential to consult financial news outlets and analyst reports from firms like TipRanks, MarketBeat, and Yahoo Finance. These ratings typically range from 'buy' to 'sell,' with varying price targets. For instance:

• As of April 15, 2025, 15 analysts have offered 12-month price forecasts for GoDaddy Inc., with a median target of $45.00.
• The range of these estimates is from a low of $37.00 to a high of $58.00.

Here is a summary of valuation metrics based on the latest available data:

Keep in mind that these metrics should be considered alongside broader market conditions and the company's specific financial performance to form a comprehensive valuation assessment. For more detailed insights, read: Breaking Down GoDaddy Inc. (GDDY) Financial Health: Key Insights for Investors.

GoDaddy Inc. (GDDY) Risk Factors

GoDaddy Inc. (GDDY) faces a variety of risks that could significantly impact its financial health. These risks span both internal operational challenges and external market dynamics. Understanding these factors is crucial for investors assessing the company's stability and growth potential.

Industry Competition: GoDaddy operates in a highly competitive market, facing competition from other domain registrars, web hosting providers, and website builders. This intense competition can lead to pricing pressures, increased marketing expenses, and potential loss of market share. Maintaining a competitive edge requires continuous innovation and effective marketing strategies.

Regulatory Changes: The internet and related services are subject to evolving regulations worldwide. Changes in data privacy laws, domain name regulations, or tax policies could increase compliance costs and impact GoDaddy's ability to operate in certain markets. Staying ahead of these regulatory changes requires a proactive legal and compliance strategy.

Market Conditions: Economic downturns, changes in consumer behavior, and technological disruptions can all affect GoDaddy's financial performance. For example, a decrease in small business formation could reduce demand for GoDaddy's services. Monitoring these market conditions and adapting business strategies accordingly is essential for mitigating these risks.

Operational, financial, and strategic risks are often detailed in GoDaddy's earnings reports and filings. These may include:

• Security Breaches and Data Protection: As a provider of online services, GoDaddy is a target for cyberattacks. A significant data breach could damage the company's reputation, lead to legal liabilities, and disrupt operations. Investing in robust cybersecurity measures and data protection protocols is critical.
• Dependence on Third-Party Providers: GoDaddy relies on third-party providers for various services, including cloud infrastructure and payment processing. Disruptions or failures in these services could negatively impact GoDaddy's operations and customer experience. Diversifying these dependencies and establishing strong service level agreements are important risk mitigation strategies.
• Integration of Acquisitions: GoDaddy has grown through acquisitions, and integrating these businesses can be challenging. Difficulties in integrating technologies, cultures, or processes could lead to inefficiencies and loss of synergies. Careful planning and execution are essential for successful integration.

Mitigation strategies and plans that GoDaddy may employ include:

• Investing in Cybersecurity: Continuously improving security infrastructure and protocols to protect against cyber threats.
• Diversifying Service Offerings: Expanding into new services and markets to reduce dependence on core products.
• Enhancing Customer Support: Improving customer service to increase customer retention and loyalty.
• Strategic Partnerships: Forming partnerships to expand reach and capabilities.

Understanding these risks and mitigation strategies is vital for investors looking to assess GoDaddy's long-term financial health and stability. For more insights into GoDaddy's investor profile, consider exploring: Exploring GoDaddy Inc. (GDDY) Investor Profile: Who’s Buying and Why?

GoDaddy Inc. (GDDY) Growth Opportunities

GoDaddy Inc.'s future growth prospects are underpinned by several key drivers, including product innovations, market expansions, and strategic acquisitions. The company's focus on providing a comprehensive suite of tools and services for small businesses and entrepreneurs positions it well for continued expansion in the digital economy.

Key growth drivers for GoDaddy Inc. (GDDY):

• Product Innovations: GoDaddy is continuously enhancing its product offerings to meet the evolving needs of its customer base. This includes improvements to its website building tools, marketing services, and e-commerce solutions.
• Market Expansions: GoDaddy is expanding its presence in international markets and targeting new customer segments, such as larger businesses and enterprises.
• Acquisitions: GoDaddy has a history of acquiring companies to expand its product portfolio and enter new markets. These acquisitions can provide access to new technologies, customer bases, and talent.

While specific future revenue growth projections and earnings estimates for GoDaddy Inc. (GDDY) beyond fiscal year 2024 are subject to market conditions and company performance, analysts' estimates provide insight into potential growth trajectories. For instance, revenue for the year ending December 31, 2024, is estimated to be $4.26 billion. Looking ahead, revenue is projected to reach $4.57 billion in 2025 and $4.91 billion in 2026.

Here's a summary of GoDaddy Inc.'s revenue projections:

Strategic initiatives and partnerships play a crucial role in driving GoDaddy's future growth. These collaborations can enhance the company's offerings, expand its reach, and improve customer engagement. GoDaddy's competitive advantages, such as its brand recognition, large customer base, and comprehensive product suite, position the company favorably for sustained growth in the competitive web services market.

To understand more about the core principles guiding the company, check out: Mission Statement, Vision, & Core Values of GoDaddy Inc. (GDDY).