GoDaddy Inc. (NYSE:GDDY) Q4 2023 Earnings Call Transcript February 13, 2024
GoDaddy Inc. beats earnings expectations. Reported EPS is $7.85, expectations were $1.03. GoDaddy Inc. isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Christie Masoner: Good afternoon, and thank you for joining us for GoDaddy’s Fourth Quarter and Annual 2023 Earnings Call. I’m Christie Masoner, VP of Investor Relations. And with me today are Aman Bhutani, Chief Executive Officer; and Mark McCaffrey, Chief Financial Officer. Following prepared remarks, we will open up the call for your questions. [Operator Instructions] On today’s call, we’ll be referencing both GAAP and non-GAAP financial measures and other operating and business metrics. A discussion of why we use non-GAAP financial measures and reconciliations of our non-GAAP financial measures to their GAAP equivalents may be found in the presentation posted to our Investor Relations site at investors.goddady.net or in today’s earnings release on our Form 8-K furnished at the SEC.
Growth rates presented represent year-over-year comparisons, unless otherwise noted. The matters we’ll be discussing today include forward-looking statements such as those related to future financial results and our strategies or objectives with respect to future operations. These forward-looking statements are subject to risks and uncertainties that are discussed in detail in our periodic SEC filings. Actual results may differ materially from those contained in forward-looking statements. Any forward-looking statements that we make on this call are based on assumptions as of today, February 13, 2024. And except to the extent required by law, we undertake no obligation to update these statements because of new information or future events. With that, I’m pleased to introduce Aman.
Aman Bhutani: Good afternoon, and thank you all for joining us today. At GoDaddy, our mission is to empower entrepreneurs and make opportunity more inclusive for all. Our strategy centers on creating customer value, driving profitable growth resulting in compounding free cash flow per share and long-term shareholder value. Our focus remains on margin expansion and growth in our Applications and Commerce segment. 2023 was a pivotal year for us and I am pleased with our financial and operational results. Innovation accelerated as we brought together our technology capabilities into a unified technology stack, enabling us to launch our compelling GoDaddy Airo experience. We also drove 2023 normalized EBITDA margin ahead of our guidance as we balanced investment in growth and cost structure management.
Full year normalized EBITDA margin increased approximately 200 basis points, resulting in a 12% increase in free cash flow and a 21% increase in free cash flow per share. In Q4, we drove 16% bookings growth for our high margin segment, Applications and Commerce segment and this momentum continued into January. Our focus on the combination of optimizing costs and driving growth in Applications and Commerce, has positioned our business well to exit 2024 with a normalized EBITDA margin of approximately 31%. At the Investor Day in November, we showcased how GoDaddy Airo delivers a seamless experience for identity and presence and our teams have launched even more capabilities since then. At our upcoming Investor Day on March 6, we will showcase these new capabilities as well as provide a sneak peek into what is coming soon.
Airo enablement of Commerce features will also be showcased, which now expands the Airo experience across the entire entrepreneur’s wheel, fully unlocking the full power of GoDaddy’s software platform for our customers in a seamless and intuitive manner. Over the last few quarters, we covered our continued efforts to optimize our marketing spend and G&A expenses. We have had similar efforts in technology and development and care as well. In technology and development, the simplification and unification of our technology stack led to a material reduction in our server footprint and multiple areas of costs associated with it. We also expanded our access to talent globally and together, these items benefited both our capital and operating expenses.
See also 20 Fastest Growing Energy Companies in the US and 15 Easiest Countries to Immigrate to from Mexico.
To continue reading the Q&A session, please click here.