Global internet domain name provider GoDaddy (NYSE: GDDY) recently reported its second quarter results that failed to impress the market. It did not make matters better when it announced that its CEO Scott Wagner was stepping down.
GoDaddy’s Q2 revenues grew 13% over the year to $737 million, ahead of the market’s forecast of $735.4 million. Net loss came in at $12.6 million compared with a net income of $18.1 million a year ago. Excluding one-time items, it reported EPS of $0.01 cent, below analysts’ estimate of $0.16.
By segment, GoDaddy’s Domain revenues grew 10% to $334.4 million. Hosting and Presence revenues grew 14% to $279.8 million, and Business Applications revenues grew 20% to $123 million. During the quarter, total bookings grew 12% to $846.1 million.
The company’s customer base grew 6% over the year to 19 million. Average revenue per user grew 8% over the year to $153.
For the third quarter, GoDaddy expects revenues of $755-$765 million, compared with the Street’s forecast of $760.5 million. It expects to end the year with revenues of $2.97-$3 billion for the year, compared with the Street’s estimate of $2.99 billion.
GoDaddy’s Product Expansion
GoDaddy continued to improve its product offering during the quarter, especially for its GoCentral and Managed WordPress services that are driving over 40% growth. It recently introduced a new GoCentral template interface that delivers more flexibility in the website building process. The new interface will allow creators to visualize and deliver content in several different layouts simultaneously. The feature will help builders experiment and adjust their site at any point in time while building the site.
To drive its marketing and publishing engine, GoDaddy is expanding its social integration. It already had integrations with Facebook, Yelp, and Google My Business. It recently added integration capabilities with Instagram.
GoDaddy is expanding its partnerships with other technology companies to drive market adoption. Recently, it deployed several of its products such as ProTools into various Amazon solutions that will help higher-end WordPress developers using Amazon Lightsail on AWS. Amazon Business Prime members now have access to a free trial for GoCentral and SmartLine as well. It is also integrating its domain platform into AWS so that it will power AWS’ new domain registration. Post the integration, GoDaddy will become the domain technology provider for all major public cloud vendors.
GoDaddy also entered into a new partnership with Kabbage, a provider of real-time small business financing. As part of the agreement, GoDaddy will help its customers get access to financing solutions from Kabbage. Within e-commerce, it expanded its partnership with PayPal customers to allow them to not only use PayPal as a checkout option but also use the PayPal Commerce Platform for back-end processing of other funding sources such as credit cards.
GoDaddy also announced that its CEO of seven years, Scott Wagner, was stepping down for health reasons. He is being replaced by the former President of Brand Expedia Group Aman Bhutani.
The market is not very pleased with GoDaddy’s progress. Its stock is trading at $63.28 with a market capitalization of $11.3 billion. It touched a high of $84.97 in September last year. Its stock hit a 52-week low of $56.67 in December last year.