GoDaddy delivered a solid third quarter, with revenue and profit surpassing Wall Street expectations and stable customer growth. Management credited the outperformance to the accelerated adoption of its AI-powered Airo platform and growing demand for both primary and secondary domain offerings. CEO Amanpal Bhutani emphasized the company's focus on developing new Agentic AI capabilities and improving operational efficiency, stating, "We delivered strong financial results, achieving 10% growth in total revenue while also delivering A&C bookings growth acceleration to 14% on strengthening customer cohort dynamics." The market responded with little movement, reflecting an in-line assessment of the results.
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GoDaddy (GDDY) Q3 CY2025 Highlights:
- Revenue: $1.27 billion vs analyst estimates of $1.23 billion (10.3% year-on-year growth, 2.7% beat)
- Adjusted EPS: $1.99 vs analyst expectations of $2.15 (7.1% miss)
- Adjusted Operating Income: $296.7 million vs analyst estimates of $283.9 million (23.4% margin, 4.5% beat)
- Revenue Guidance for Q4 CY2025 is $1.27 billion at the midpoint, below analyst estimates of $1.27 billion
- Operating Margin: 23.4%, up from 22.1% in the same quarter last year
- Customers: 20.41 million, up from 20.41 million in the previous quarter
- Annual Recurring Revenue: $4.29 billion vs analyst estimates of $4.21 billion (8% year-on-year growth, 1.9% beat)
- Billings: $1.29 billion at quarter end, up 9.1% year on year
- Market Capitalization: $17.99 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From GoDaddy’s Q3 Earnings Call
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Vikram Kesavabhotla (Baird) asked about the impact of AI and Agentic services on domains and websites; CEO Amanpal Bhutani responded that AI makes website creation easier, which should increase domain demand.
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Ygal Arounian (Citi) inquired about the rollout and monetization strategy for Airo.ai; Bhutani explained that Airo.ai is integrated with GoDaddy's core platform, with rapid agent testing and paywalls via Airo Plus.
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Trevor Young (Barclays) asked about GoDaddy's shift toward smaller, faster teams for product innovation; Bhutani confirmed that AI-driven efficiencies enable more frequent, rapid releases, especially through Airo.ai.
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Hoi-Fung Wong (Oppenheimer) questioned the rationale behind Agent Name Service; Bhutani described ANS as building on DNS infrastructure to provide agent identity and trust, leveraging GoDaddy’s foundational internet role.
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Willow Miller (William Blair) queried whether AI-driven efficiencies in internal operations would offset investment costs; Bhutani and CFO Mark McCaffrey confirmed that demonstrated efficiencies are allowing for reinvestment without sacrificing profitability.
Catalysts in Upcoming Quarters
In future quarters, our analysts will be watching (1) the adoption rate and monetization of new Airo agents and the Agent Name Service, (2) the impact of product mix changes and AI-driven efficiencies on margins, and (3) continued growth in high-value customer cohorts and expanded subscription offerings. Additional attention will be paid to international performance and the resilience of aftermarket domain transactions.
GoDaddy currently trades at $133.08, up from $126.64 just before the earnings. Is there an opportunity in the stock?Find out in our full research report (it’s free for active Edge members).
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