GoDaddy Inc. (NYSE: GDDY) reported financial results for the fourth quarter and full year ended December 31, 2022.
“GoDaddy achieved strong revenue and cash flow growth in 2022, despite macroeconomic headwinds,” said GoDaddy CEO Aman Bhutani. “During the year we delivered on an innovative product roadmap, including enabling commerce on every surface. As we enter 2023, we are excited about the full launch of our commerce offerings empowering customers to transact everywhere seamlessly. We are proud of the track record we are building to participate in our customers’ success and drive long term value for shareholders.”
“GoDaddy delivered solid 2022 financial results demonstrating the resiliency of our business,” said GoDaddy CFO Mark McCaffrey. “We have taken actions to align our priorities and cost structure to continue to deliver strong financial results with continued operating leverage while at the same time investing in key long-term initiatives that will fuel future top-line growth.”
Full Year 2022 Business Highlights
- Total revenue of $4.1 billion, up 7.2% year-over-year, and 8.4% on a constant currency basis.
- Total bookings of $4.4 billion, up 4.3% year-over-year, and 6.0% on a constant currency basis.
- Net Income of $352.9 million, up 45.3% year-over-year.
- Normalized EBITDA of $1.0 billion, up 16.1% year-over-year, representing 25% margin.
- Net cash provided by operating activities of $979.7 million, up 18.1% year-over-year.
- Free cash flow of $968.6 million, up 13.2% year-over-year.
- Unlevered free cash flow of $1.1 billion, up 14.2% year-over-year.
- Through February 1, 2023, share count reduced 10% since launch of GoDaddy’s current share buyback authorization in 2022.
Fourth Quarter 2022 Business Highlights
- Signed a meaningful partnership agreement with FIS Worldpay, the market-leading merchant services provider, to sell GoDaddy’s OmniCommerce solutions for US based small business customers and bank partners.
- Launched Managed WooCommerce Stores solution, enabling entrepreneurs to easily sell in-person and across marketplaces and social channels through one unified dashboard and without the need to download additional plugins.
- Implemented payments by default, automatically attaching GoDaddy’s premier payments platform to its domains and website building plans. GoDaddy’s goal of enabling commerce on every surface gives customers the freedom to seamlessly transact as soon as their website or domain is created.
- Annualized recurring revenue (ARR) for applications & commerce grew 9% year-over-year to $1.3 billion in the fourth quarter.
- ARR from GoDaddy’s Create and Grow group of products, which includes Websites + Marketing, Managed WordPress, Sellbrite, and GoDaddy Studios, surpassed $445 million, growing 8% year-over-year in the fourth quarter of 2022.
- Drove strong growth in its Commerce offerings with gross merchandise volume of $28 billion, up 10% year-over-year.
- Gross payments volume, or GPV, from GoDaddy’s commerce offerings has already grown to an impressive $760 million.
- ARR for Core Platform grew 1% year-over-year to $2.3 billion in the fourth quarter.
From January 1, 2022 through February 1, 2023, GoDaddy repurchased 17.2 million shares of its common stock for an aggregate purchase price of $1.3 billion, and an average price per share of $77.11. These repurchases represent an approximately 10% reduction in fully diluted shares from those outstanding as of December 31, 2021.
At December 31, 2022, total cash and cash equivalents were $774.0 million, total debt was $3.9 billion and net debt was $3.1 billion.
On February 8, 2023, GoDaddy announced a restructuring plan aimed at driving over $100 million in annualized cost savings through a reduction in force, operating expense reductions and integration of certain European brands and businesses within our Core Platform segment. GoDaddy expects restructuring and other related exit charges of approximately $55 million to $65 million to be recorded in the first half of 2023.
For the first quarter ending March 31, 2023, GoDaddy expects total revenue in the range of $1.030 billion to $1.050 billion, representing year-over-year growth of 4% at the midpoint, versus the same period in 2021. For the full year ending December 31, 2023, GoDaddy is targeting total revenue in the range of $4.250 billion to $4.325 billion, representing year-over-year growth of 5% at the midpoint, versus the $4.09 billion of revenue generated for the full year ended December 31, 2022.
For the first quarter ending March 31, 2023, GoDaddy expects Normalized EBITDA margin to be in the range of 24% to 25%. For the full year ending December 31, 2023, GoDaddy expects Normalized EBITDA margin of approximately 26%.
For the full year ending December 31, 2023, GoDaddy expects unlevered free cash flow of approximately $1.2 billion, representing growth of 9%, year-over-year, versus the $1.1 billion of unlevered free cash flow generated in 2022. GoDaddy expects free cash flow of approximately $1.0 billion, representing growth of 3%, year-over-year, versus the $968.6 million of free cash flow generated in 2022.