GoDaddy Inc. Q3 FY2025 earnings call

• AI Initiatives: Airo platform evolving from Generative AI to Agentic AI; launched 5 new Airo agents for customer tasks, with more agents to come; Airo.ai beta launched. Teams using AI to reduce product cycle time, e.g., over 45% of code written in Q3 was AI-generated. • Agent Name Service: Launched GoDaddy's Agent Name Service (ANS) built on DNS infrastructure, providing verifiable identities for AI agents. • Strategic Growth Initiatives: Pricing and bundling delivering strong results; seamless experience improving conversion, attach, and renewal rates; commerce growth solid with payment solutions and high-margin subscriptions; GoDaddy Airo driving better attach, higher average order size, and improved retention.

In the third quarter, total revenue grew 10% to $1.3 billion. The A&C segment delivered 14% revenue growth to $481 million, while the Core Platform segment had 8% revenue growth to $784 million. International revenue grew 14%. The A&C segment contributed approximately 37% of total revenue ($481 million / $1.3 billion ≈ 37%), and the Core Platform segment contributed approximately 60.3% ($784 million / $1.3 billion ≈ 60.3%).

• Raised full-year 2025 revenue guidance to 8% growth, the top end of the 3-year range of 6% to 8%. • Q4 revenue expected to be in the range of $1.255 billion to $1.275 billion, representing 6% growth at the midpoint. • Full-year normalized EBITDA margin expected to be approximately 32%, with Q4 projected at 33%. • Free cash flow target of approximately $1.6 billion, representing over 18% growth. • A&C revenue growth expected in the mid-teens for full year, Core Platform growth in the mid-single digits.

Q: Vikram Kesavabhotla from Baird asked about the impact of AI on domains/websites and customer base progression.

A: Aman Bhutani said AI and Agentic AI will automate journeys, leading to more websites and agents, with Airo.ai showcasing agents. Mark McCaffrey noted focus on high-intent customers ($500+ cohort) driving ARPU growth.

Q: Ygal Arounian from Citi asked about Airo.ai rollout and customer cohort dynamics.

A: Aman Bhutani discussed Airo.ai built on GoDaddy platform, Airo Plus monetization, and new capabilities. Mark McCaffrey said high-intent cohort has better attach and retention, driving ARPU growth.

Q: Trevor Young from Barclays asked about experimentation culture and aftermarket growth.

A: Aman Bhutani said smaller teams using AI to create features quickly on Airo.ai, then bringing to core. Mark McCaffrey noted strong aftermarket growth, including higher-value transactions.

Q: Josh Beck from Raymond James asked about TAM for Airo.ai and custom app competitiveness.

A: Aman Bhutani said Airo.ai caters to different customer segments with tailored AI experiences. Mark McCaffrey highlighted high-intent customers driving wallet share.

Q: Ken Wong from Oppenheimer asked about Agent Name Service and guidance drivers.

A: Aman Bhutani explained ANS provides verifiable identities for agents. Mark McCaffrey said strength across business, including A&C and domains, drove guidance raise.

Q: Willow Miller on for Arjun Bhatia asked about AI investments and internal use cases.

A: Aman Bhutani and Mark McCaffrey said AI investments offset by internal efficiencies, with care and engineering seeing efficiency gains.

Q: Mark Zgutowicz from The Benchmark Company asked about A&C bookings and EBITDA deleverage.

A: Mark McCaffrey said A&C growth driven by high-intent customers, EBITDA deleverage due to product mix shifts.

Q: Ryan Powell on for Naved Khan asked about WordPress uptake and international growth.

A: Aman Bhutani said WordPress updates well received, Mark McCaffrey noted international growth similar to domestic.

Q: Eleanor Smith on for Alexei Gogolev at JPMorgan asked about SMBs and domains/AI.

A: Aman Bhutani said SMBs resilient, AI symbiotic with domain growth. Mark McCaffrey noted secondary market activity.

Q: John Byun for Brent Thill asked about MCP and A&C growth.

A: Aman Bhutani said GoDaddy supports MCP/A2A protocols. Mark McCaffrey said A&C growth driven by high-intent cohort momentum.

Q: Elizabeth Elliott from Morgan Stanley asked about commerce and website evolution.

A: Aman Bhutani said preparing to surface customer content across AI technologies. Mark McCaffrey said strengthening cohort dynamics driven by renewal rates, attach, and new customers.