The global internet domain name provider GoDaddy (NYSE: GDDY) recently reported its third quarter results that surpassed market expectations. The market was pleased with its performance, and the stock climbed 10% in the after-hours trading session.
For the quarter, GoDaddy’s revenues grew 12% over the year to $761 million, in line with the market’s forecast. Bookings for the quarter grew 15% over the year to $851 million. Net income was $76.2 million, significantly ahead of the $13.2 million it had reported a year ago. On an adjusted basis, net income was $0.42 per share compared with the Street’s estimate of $0.22.
By segment, revenues from the Domain segment grew 12% to $345.3 million. Hosting and Presence revenues grew 8% to $285 million driven by the improvement in engagements, bookings, and appointments within this segment. Business Applications revenues grew 22% over the year to $130.2 million.
Among other operating metrics, its customer base grew 5% over the year to 19.1 million at the end of the quarter. Average revenue per user grew 7% to $155 driven by growth in its international markets. International revenues grew 8% over the year to $254.3 million.
The company also announced a $500 million share buy-back program for the year. This was its biggest buy-back program ever.
For the current year, GoDaddy expects to end with revenues of $2.98-$2.99 billion, compared with the Street’s estimate of $2.99 billion.
GoDaddy’s Partner Expansion
In the recent quarter, GoDaddy has entered into several partnerships that are helping its customers drive their businesses. Recently, it announced one such agreement with Kabbage, a data and technology company that offers small businesses cash flow solutions. As part of the agreement, Kabbage’s online lending platform will be available to GoDaddy’s US customers so that they can easily access a line of credit to grow their businesses. Kabbage has put together a simple application process that allows SMBs to access lines of credit up to $250,000 in minutes if approved.
The decision to offer a service like this was made based on a customer survey that the two companies conducted. The survey revealed that nearly half of the SMBs surveyed found lack of money as one of the roadblocks to growing their digital presence or online advertising. As part of the agreement, customers applying for Kabbage Funding through GoDaddy are not required to submit any fee. Additionally, qualified business owners will also not be obligated to make withdrawals from their credit line until they need access to the funds. They will also get to take advantage of $100 off their first month’s fees as part of this initiative.
Besides providing access to funds, GoDaddy is also helping its customers expand their e-commerce presence. Earlier last month, it announced an integration with WooCommerce, a powerful eCommerce engine available for WordPress. The integration will help accelerate and simplify the process of setting up a fully functioning eCommerce site for GoDaddy’s customers. WordPress users will be able to quickly establish their eCommerce sites with pre-populated, customizable design themes, and GoDaddy’s WordPress users will get free access to WooCommerce premium extensions.
Its stock is trading at $69.36 with a market capitalization of $11.9 billion. It touched a high of $82.30 in April this year. Like other technology stocks, GoDaddy’s stock had fallen to a 52-week low of $56.67 in December last year.