GDDY - Earnings call transcript Q2 2024

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Christie Masoner

Welcome to GoDaddy's Second Quarter 2024 Earnings Call. Thank you for joining us. I'm Christie Masoner, VP of Investor Relations. And with me today are Aman Bhutani, Chief Executive Officer; and Mark McCaffrey, Chief Financial Officer.

Following prepared remarks, we'll open up the call for your questions. we'll other both operating call, financial and today's and measures and Instructions] On be GAAP referencing non-GAAP [Operator business metrics. why non-GAAP on X-K SEC. their at investors.godaddy.net of reconciliations our posted to found Form discussion we in Relations financial presentation non-GAAP A site Investor measures in of the our the equivalents today's financial furnished GAAP to or with our measures may be use and earnings release

those today include XXXX. may rates and matters are discussing subject assumptions in the SEC except Growth statements that of events. with call discussed uncertainties year-over-year differ Any forward-looking on we'll related operations. those are from statements otherwise comparisons future our future these X, risks forward-looking we These periodic on extent new objectives results are filings. statements, The obligation by noted. based forward-looking in to we represent results because information August unless statements. And or materially respect that or financial detail today, undertake forward-looking as make to no and our this law, to to to update required statements of contained as such be future strategies Actual in

With I'm to that, introduce pleased Aman.

Amanpal Bhutani

you thank everyday mission is entrepreneurs today. for to and afternoon, all. At Good empower inclusive more and us joining GoDaddy, for our make opportunity

to of customer said, runs has environment, who and source on One That businesses. business been GoDaddy said for millions inspiration. add us business constant I'm services real to done. recruiting is be a my years, having a company, over have team today's extended us business are that micro is XX customers wrote Our in for extended easier recently team. with to of the than partners value our goal, happy

creating and on and value better shareholder through relentlessly it value retention. conversion, strategy is attach transforming to focused customer Our

QX executing the team term. profitable our free The cash of growth over maximize is expansion North efficiency, against meaningful to delivering leading flow, and This drive cash drives to innovation this our flow includes long operational Our results. strong model growth. free XX% plan GoDaddy Star, to

bookings XX% expanded more basis margin and than and grew normalized Applications Additionally, Commerce points. XXX EBITDA

are Our software GoDaddy driven the the margin powered by initiatives innovation and key by platform. growth

our is aspiration experience, to this the unique growing of is search this magical, with to of they deliver excited about ability multiple aspiration. to on Airo's can our that experiences Our is I their customers, businesses. Airo, to scale domain to be one AI-powered websites, am start their by reinvent insights seamlessly data. how intuitive from fueled GoDaddy results and and interactions GoDaddy's improve

markets, QX, to for Over Airo customers. XX countries X.X is our experience. it Airo them existing million further for customers the our transformed an has million in English-speaking months. Airo, poised customers already across have discovered now rolled expansion exciting X out into In of and new and coming actively with milestone. the experience new over all new passed the we and over engaged is

One also fully focus website coming the we followed with will experiment Marketing as This a example and which of Airo to improved retention, With moved Websites renewal page. to strong for in new controlled has Coming monetization a periods conversions quarters. XX%. the Airo more traction their them. data with rollout which limited enter a these in leads product cohorts rollout + Early customers, full that better begin shows understand is discovery to the after engagement built paywall a Soon on has immediately

the parallel, connect are customers. In our base million existing with we engine of Airo to building XX

then same: discovery, the but then engagement a approach monetization. is here goal Our different the and motion, go-to-market is

GoDaddy. our Airo one future represents with monetization of opportunities base we the Investor larger Day, As our for at shared of

which bot, more investing also assist in over now can AI-powered our guide languages. are We communicate in XX GABI, internal

Now more customers efficiently. rolled GABI our globally, serve is helping and work guys out

our in Pricing be are contributor and driven was by to continues drive and about bundling GABI bookings. the continued pricing by and to XXXX commerce. to the our seamless growth in growth, future, Airo and and bundling, led and applications commerce investments a experience productivity, While key significant growth initiatives:

We opportunities platform have product started our next capabilities to experimentation for machine beyond. to look we set apply learning next and bundles data, of and the as year at

renewal our continued robust paths take conversion and our technology initiative to small expectations, from friction products. we through AI-generated user expanded customers, our experience At experience results. purchase both content. measurable financial rates seamless use as and provide away overperformed our of we renewal effort In scale, versus improvements across Our remove in in multiple and the better weight

in For we publish content enhanced our templates models for customers easier making generate and optimized WordPress, pages, multiple to and build example, websites. Managed it for have to

real-time and also that online grow at to continued existing customizable Annualized operations, branded premium ordering fast a Point-Of-Sale e-mails. offer XXXX Plus These On fees higher-margin conversion Plus. new being and value discounted within of our and Invoicing launch base inventory primary tools customers of our with with and again, commerce, we plans recent They target templates GPV driving including offering their on by are driver, X of pace, simplify delivering features transaction to subscription management, merchants. the our plants, customers. the for drive invoices SaaS for revenue

as striving track enduring for growth value. and improvement and profitable create customer GoDaddy of closing, initiatives, exceed continue value continuously on an aim unwavering propel fearlessly we experiment, deliver expectations, new to the meticulously boundaries push The our and shareholder I with term. growth thrilled day. each determination for to am key creation unlocking execution speed avenues results of team continue to the shares long prioritize, and In we

Mark. With that, here's

Mark McCaffrey

Aman. Thanks,

commitment Star announce of progress pleased to term. QX results, are the We long North continued and flow our free which demonstrate our strong towards maximizing our cash to over execution

normalized increasing continues XX%. to double-digit second XX% bolstered segment, our further our be Commerce Our EBITDA quarter, in to the Star margin in pillars: and X sustained and by growth North key expansion of revenue Applications

to track strong build here, continued in flow cash record of on million free $XXX delivering our the quarter. We

buybacks years on the to reducing remain end use, Airo, We delivering ]. while share XXX continued allocation are also to on driving attached diluted customers our We [ that million same operations quarter easy come. at retention. experiences fully to provide such focusing initiatives continue as in which and seamless providing implement and to the of benefits laser-focused outstanding our conversion to refine our value growth, by exciting we strategy, our capital better At deliver shares the for profitable will disciplined for to time, investing

X% constant trailing currency basis, $X.X reported quarter. the grew and for financial guided on a to to high results grew Moving our up the the to basis. of for $XXX exceeding our a XX-month Total ARPU end on X% quarter. revenue billion, range

customer Our expected revenue basis by the customer products approximately our declined X retention Meanwhile, with or customers us. impacted and to XXX our million, slightly headwinds from divestiture proactive is $XX.X also GoDaddy's XX%, that more have an of count points. and XX% impressive rate efforts reflecting migration over

productivity of Applications the and range. initiatives and delivering growth and high our our revenue For at and product bookings we segment, Applications in guided continued XX% Commerce our million, all across solutions. bookings high-margin due was end revenue the drove growth Commerce $XXX offerings, to in XX% major largely performance our to growth strong Growth particularly of in

EBITDA The margin improved XX%. segment to

grew to ARR XX% In billion. $X.X and Applications Commerce for addition,

platform growth this partially growth domains and of XX%, X% Our grew in range. delivered performance in and Core core to X% segment platform divestitures. core for with up revenue primary line to EBITDA offset continued X% reflected million, aftermarket our up bookings strength of XX%. guided $XXX platform's quarter hosting Segment by both margin

our billion, for platform up ARR Lastly, was segment core $X.X X%.

update on quick domains One under management.

that management QX migration overstated by related the were in work the with under end XXXX to This determined we X.X domains our approximately quarter, to domains, European connection of brand TLDs. million at primarily related efforts,

the the this domains million impact Following were of QX, the from of as end at June correction of divestiture approximately XX, completed with management XX.X under disclosure, domains. coupled

be our North operating it metric, While towards Star. is key or this or not a progress our closely not metric may understand we forecast impact financial followed, and does this

XX% bookings, Normalized on delivered growth an basis, currency achieving margin and constant in million, EBITDA reported points a quarter Moving and second the $XXX to XX%, of to XXX we billion. $X.X profitability. basis and exceeding XX% grew On guide. up over expanded delivered our

primarily of subscription bookings ahead cash X collected reminder, revenue. represent a the the As during points over grew period. bookings Subscription

free cash XX% to grew Unlevered quarter for grew $XXX to were $XXX down XX% the expenditures cash free data flow divestitures. million, center flow Capital XX% from million. and

million. X.X XX.X and billion repurchased current shares we under $XXX shares. totaled authorizations July million Through Cumulative shares our totaling year-to-date, repurchased million $X.X XX,

We have under authorization. current remaining million our $XXX

at of our the XX%. since reduced We have by January targeted diluted shares of fully outstanding outstanding XXX XXXX quarter. XX%, X-year the had million We reduction shares ahead end of gross

minimum every As quarter, in previously, plan dilution. to conditions other to we with be market subject market to we a share-based offset and compensation shared have the factors

our we On with trailing a $XXX debt finished basis. and million Net total billion, of billion. balance representing X.Xx liquidity $X.X on $X.X cash leverage sheet, XX-month was in of net QX

Shifting to our outlook.

and of Given be we $X.XXX are year, our revenue expect X% $X.XXX at the performance revenue our of year the full to in year's billion strong approximately midpoint. now representing guidance. half the between full first the raising billion, growth We

at to total our growth QX the targeting also are billion X% billion, of $X.XX approximately in of $X.XX range the representing We range. revenue of midpoint

QX and full Application for deliver single-digit quarter the to segment in year. core In and third expectations the for our platform raising growth also full to year. are expect growth Commerce we mid-teens We deliver low revenue our and

leverage model. maintaining of With our our expansion, record to are track proven to our further we in committed discipline operational drive margin

EBITDA normalized expect margin approximately to be We for QX XX%.

on XX% full QX XX% in remain approximately for normalized track to we margin year. a the Additionally, EBITDA deliver and

we and We cash will to committed target allocation to to our for capital evaluate opportunities we Given billion $X.X to billion cash approach, raising all and to $X.XX framework. remain cash to EBITDA free our flow X:X are continue plus. our our rigorous normalized according returns-based return conversion disciplined flow plus, ratio, free also unlevered flow shareholder free nearly target

we growth in with the laid out our and profitability. XXXX, path our our impressive with Day, North strategy made We first we profitable dedicated progress durable Investor a executing line expanded in to have combination the line at growth of half on top Star driving of and remain

sheet for strong allocation substantial are capital shareholders. generation, thesis enduring and investment create that our value our pillars disciplined Our of cash framework balance important

up Masoner our Christie have team from for will we open Investor call that, Relations the With questions.

Christie Masoner

Instructions] comes line James. from Mark. of Our Josh question first from the Raymond Beck [Operator Thanks,

Josh Beck

quarter. to the this low through I rising major the A&C drivers. think from to with start wanted mid-XXs Maybe help us bookings unpack and

You those comps into A&C for change and bookings cognizant could as related, bundling look ahead? of and half to productivity, anything think the need And in that how maybe about as then be obviously we and we cited we well? when 'XX second

Mark McCaffrey

Go ahead, Aman.

Amanpal Bhutani

take. to platform. Super full part excited XX% power, of A&C for thanks growth. want I GoDaddy a as the bookings, software Josh, scale table data to and It's the we're those momentum one the in of And GoDaddy about bringing the question. the

So our broader set are pricing suite. bundling it's And experience our whether all to we're or capabilities bringing a and they commerce, these growth. helping A&C obviously, or improvements seamless of product

So sort customers of scenarios very the capabilities about as able we customers into these continue products existing we across our with to implement new excited with be both future, to and entire as look well. being in

Mark I'll pieces. the let take financial some And of

Mark McCaffrey

Josh, the QX bookings. of the product within And with And momentum continue all in we to followed just Yes. double-digit for the QX year, A&C. growth across to area see -- half every for first groups

year, mind, in it us. keep comps, compared QX about last was an asked for easier to you comp When

we But bundling So the it this overall some it that's doesn't momentum us as going reported give change the going forward benefit of did on. quarter.

Josh Beck

just on quick maybe follow-up And metrics. a Airo, really helpful. Super helpful

been ahead, hadn't of of quarters ramping think the the we Is early And this what X number that long. X.X If about mentioned engaged. group, of discovered, you out engaged standouts about maybe cadence the million from in in point with I some when of terms on customers you the maybe adoption million right think that curve to think obviously, suite? double-click it are that view?

Amanpal Bhutani

it. couldn't be Yes. with a The I excited at about fast customers is more engaging tremendously happening new Airo pace.

really I but with discovery, we're the right? product, the We've news engagement crossing the about seeing importantly, think X-step process then customers, talked there. million good And engagement monetization. the for more of milestone, new

renewal. on the I little come to starting a monetizing learn about and But bit talked for when going Right? customers. we're As about that new those more in a lot remarks, paywalls add we're to customers up the prepared

And we most areas you where engagement. the asked about the see

automated has AI website. the not a website of the they website but more just can actually customers actually a customize we're bit little them, GoDaddy areas one-page most seeing engagement capability capabilities now One where the is sort A too. with that lot build fact of to domain discovering just which for

and is Airo and really, ultimately, going option we to of but monetization that, focused ] enjoying So going the the that lead bring base engagement in sort existing that's more too it's future. our to this a think, of I course, more sort And better on [ different the very the energy is and then customers large and are is then, existing more and to as discovery engagement our be have of view motion, of customers same and better. slightly go-to-market new does monetization, to the

In line, well. terms very time overall it of mirrors actually

our existing. back comments then look and If first with go at you and rollout you with

about feel pretty good we So it.

Christie Masoner

next comes Trevor the of Barclays. from from Our question line Young

Trevor Young

Great.

a that business from -- guide for is aftermarket? sub-$XX,XXX the becoming where the extending more few, transaction larger the more durable like piece the your back looks then ATV. trend coming with there for growth or about double-digit of points And about broad-based a view, solid it's it half maybe of aftermarket, on the just Or in narrow to XX to there it baked Is skewing like domains? what's year high-priced bit upwards? strength one in First just

Mark McCaffrey

into seeing We're it's overall Yes. aftermarket, and that we've Thanks, about in Trevor. volume the the to continued would coming strength, I QX. talked through obviously, And year. say, related

were return that in transactions, first we the definitely year saw of Hard related in the they last the of of half what those to seeing impacted stronger transactions are We first this larger larger We the do year. but to half predict. believe versus macro year.

and hard large there way, kind we And form. transactions, predict in close or see As in. plan being going forward, guide any we when It's of far to pretty on we in in as so what call and the come continue they fast come to them hard of they those don't can quickly front shape do us.

this and just on grower we try some the volatility time, we're to we overall volume we again, on prudent will a and seeing be larger platform to continue lower from of transactions. over single-digit So see at quarter-to-quarter the may based be call lower these that based although end, think

Trevor Young

the change it the be flow, That's flow-through and Can free million. distill helpful. or free guide, just And as on rank $XXX stronger bookings unlevered the looks maybe top $XXX stronger or line Is you million flow regular drivers a cash any cash free year, of flow the that of items raising follow-up, for order or the cash about like them? it the onetime to mindful of? full

Mark McCaffrey

repriced there's Yes, of as bookings, continued out. to because normalized I continued we call wouldn't and It strong say interest is any one some debt. well EBITDA our thing

flow. cash of the cash momentum cash free translating But on that's free just the board better across a flow of combination our part in into free So it. and it's unlevered flow

Christie Masoner

next Our from Evercore. comes Li of question line from the Jian

Jian Li

big talk of that back about on Or improvement, macro from want nice of little that as well? is Great. you're part productivity conversion circle conversion coming is top booking to seeing -- And if a Airo-driven of going Congrats can into strength the or the Can just I that you kind funnel bit backdrop? quarter acceleration A&C pricing? primarily A&C really just here. given the the a current a Airo on you bookings.

Amanpal Bhutani

Thanks On to Mark Jian. all as growth. for that, components of A&C, the of A&C, the bit a take contributing we'll Maybe Yes. the question. said,

Of but course, well. stated continues our grow GPV by led productivity we it's being in to as very remarks,

as continued business grow well. to well Our website very

very side. the even it's respect on new and though for still a love discovery terms monetization contributor the in small Airo, the of customers, to we With Airo, engagement

seeing Airo. really not of you're So much

back of And a to touch ask bit last the come more that question. on I'll Mark maybe to and bit your

Mark McCaffrey

Yes. And I think that's right.

meaningful We signs and related are to really very But to starting Don't related monetization, early a really forecast we in today. on data have but It are entering it. the it's into or cross early points stage. positive, are have around data our to monetization QX. to guide didn't the seeing impact enough build anything

Amanpal Bhutani

coming be pretty a of quarter region. a bit of the macro. global broadly, it's in And terms then door. by have was on the footprint, demand little to in steady obviously, But And so we we would say steady continued QX macro, just it in terms different

Jian Li

And margins. ask it. follow-up Got the on may a if I

So the Or you're line? of if Or EBITDA back the margin upside of to Is sort that well? this see to but as maintaining beat you're year to there continue reinvestment terms through you quarter, of like shifting the some that guide. you to sort full expenses the expect in kind bottom thinking any in flow of margins, would half? timing

Mark McCaffrey

call to to pace. this track said a our We're year. that continuing have we on We're nothing and particular would. exit point. had talked right in at is margins we are out track now. at beginning the the on out about for the rate There's expand call Everything as good we Nothing of XX% we to on we

Christie Masoner

Our Morgan the next from Elizabeth Porter question comes from of line Stanley.

Elizabeth Elliott

I ] highlighting turn a I actually it GABI? about more about customer revenue talked Or GABI. to of that can can it GABI chance should upsell is a there more center had service quick a drive and noticed a into more on you cost that think opportunity? serve efficiently. as better Is How cross-sell? is [ we guides customers follow-up

Amanpal Bhutani

Elizabeth. Thanks, Yes.

want making or with otherwise, same super capabilities core super to cost, access into GABI on sales difficult And slowly a with may them scale. we're the side, that explore guide. the a always focused to all to around provide GABI is ethos things be because of customer at in our experience guide or the in whether has more that it Our guide it's side care, our a lower to or is GABI lot or partner allow data, whether given the sort And of the service it's GABI, superior we and side the support right? able

Of to and a care drive course, of just information to we've better make of to better. contacts, the on that the of continues million access and X,XXX got guides, calls and We our GABI get lot side, sales X% bookings. guide has XX all

both. see So you'll

You'll see see more you'll on improved cost. customer the experience, leverage and

Elizabeth Elliott

hoping rolled A&C be how if driving Great. more And about bundling strategy any portfolio the just to out, the the could whether been actually customer share there there growth tail It on this factors could the driver. follow-up anything the from I'm the a the or momentum specifically out base of broadly can Is end? sounds year it with it's or you of like a product and over growth. course pricing then the side, be durability side should points finer that pretty durable on bookings. roll you multiple understand multiyear

Amanpal Bhutani

Yes.

pricing talked a Elizabeth, multiyear as Investor the bundling we and us. about As the we in initiative bit little see a initiative Day, for

leading we're the while able products way we'll and bit We it, right? same while behind year years, GoDaddy is the expect productivity the be -- So this to that bundles tools little few apply next capabilities other are the over right? a across and suite, and

sort that time. think bring stronger and it's capturing for about into really the to more offering become customer being the And works drive to the that unique of and more, going actually the platform, all GoDaddy do data, the software we able we them. all as over customer It's insight

to together looking years. multiple working pricing and we're experience seamless over in yes, forward So trying to bundle

Mark McCaffrey

Yes. And renewals. too, mind, in keep it's and for just new

factor. the a up, and sell as customer existing have the to So renewals into base, compounding that you becomes come ability

it's we bundles, That's to multiyear on more why be journey. more going. hit renewals, a So keep think going

Amanpal Bhutani

for us [ set year And second But at ] very We're comps continuing think coming of look will the or And well. the a comps company, some the these up return play clearly by two a Yes. the the to next for where I half as from bookings year. bit. the overall the is pace overall, the we future in in of that pacing tools are the ahead revenue. sets other way into they're point little

Elizabeth Elliott

Congrats on strong quarter. a

Christie Masoner

Kesavabhotla from Baird. Our next the from comes of question line Vikram

Vikram Kesavabhotla

Can me? you hear

Unknown Executive

Yes.

Vikram Kesavabhotla

Okay. to talked kind kind cash uses paydowns first on about use repurchases, of Investor where Great. ask clarify of you or priority I in capital repurchases in and just debt just to wanted back of terms that today? I terms do Mark, wanted the priorities those of within acquisitions. main how to attractive of going Day, of right you X most the now? kind allocation. of do do currently rank of capital cash And across flow uses

accelerate my comments. But you a don't finer few the I second put puts then has on to takes mean, through on from quarters quarter accelerated a look great. I now I third at could question, a And you there, some it row. second continue expect we That bookings to should the number number the that. and point quarter, A&C wanted directionally, And if growth guide specific of realize that should levels? a moderate? to in we as to the talk be Or would that

Mark McCaffrey

on at and there. here. sure generate Star remains strategy on it North same. to to free per set the the We've North look out be start, that add our We're at share at basis we quarter-to-quarter. will continues look from the laid and I'll to Star, our our out Aman On grow capital that to going I'm CAGR cash flow. continue obviously, And a allocation, ability

us, Now We everything we that for backdrop. going on the to other at we quarter-to-quarter on are look high against at continue still is that to market. be and buying our set believe ROI that a look has based factors stock in from back

talked we at Active change out at quarter-to-quarter, discussion and Day. what's different about opportunities no there at drive looking that looking can there. the that really Investor So LTV

and On our pace there. bookings, the

for couple A&C set areas. that's bookings we the X that's we're factors. by to XXXX. other nicely about for in And to based And of the revenue we the points. Now X going a on One, us expect to up year outpace seeing of think also just and to momentum some

difficult year. out as But the we more comps also get throughout we go will

the the is and move as want second I within to whether overall year and we'll pace go and momentum our we to the the percentages ability to comps, based bit there, still on today. say and really are see customer little to a tougher pacing the throughout happy get So base into But strong, third we're out with products XXXX. continue that our

Christie Masoner

next comes of from Our from Blair. question the William line Bhatia Arjun

Unknown Analyst

I'm [ Will Arjun Miller Bhatia. ] for on

and So volume-based shifting bit fees gears more in a customers GoDaddy remarks, [ ]. your SKUs is here? you you to Invoicing Or payments? to the opportunity to on called commerce new other Plus Are for and and only offered discount prepared transaction offering focusing Point-Of-Sale out attract there In advantaged transaction-based to larger merchants. more pricing areas discounted

Amanpal Bhutani

Thanks, Will.

have value we the As you'll terms payments of market. we given remember, bring pricing offering to the probably in out for there money best

new is do our set of these plans into start engage a What SaaS capabilities. to deeper customers they

So our it with easy be for more very what logo a customers a that example, that's very, custom with an And e-mail of a on to and out Invoicing are can or that invoice us sort very easy tool the way. use Plus way. in customers able to plan, set GoDaddy expanding put build a in just able

actually while advantage shareholder. customer this value advantage use for multiple as and at the we and pricing maintain for to We pricing payments. the the company also had the continue create that to creating commerce we we've differentiator avenues business. being value that and since continue we for grow and on came out us to we piece, And an with look the And

Christie Masoner

of next from Sandler. from Clarke Our question line Piper comes the Jeffries

Clarke Jeffries

is wanted of XX% in improved just improvement Aman, First, a that measure clarifying said dollar you to higher context. you improved Or a conversion first. of conversion the as could by of put that point XXX% XX%. into one. an that XX% users If I funnel? that value? Is clarify

Amanpal Bhutani

Yes.

controlled I to point noted, provide As of Clarke, a I a experiment. data that wanted

an that it XX%. it's free So was that more. typically X in free paid customer And page ways we see paywall a the that path from soon which the or And that different where coming the unit a a from to to that's by plan provide engages a to one that conversion on basis. customer coming a was tried a domain, experiment page, X soon -- and increased buys

X But main Airo these that as a website cards we across by and with Airo, here more we are where point buy aware, customers opening in a that ourselves just customers those when new way putting this improving engage situation the them example. that are engage possibilities the But has the where available are up name. more we engaged can they you're And with. is of to today all was capabilities domain customers are

more very wouldn't valuable lifetime more in on together So we're it's is the with of into that very, as those pieces, to engagement, are stepping think things we which we the long value. continue get that of to term completely of all how those of going just lead to any monetization. a different engaged sort I customers, how to we share you one And over-index

Clarke Jeffries

And Understood. follow-up. then just one

a the imagine but we that countries. You English-speaking English-speaking contribution rollout the is base there percent countries. have What to speaking of is sizable is breakout, from there versus that non-English international mean domestic mentioned I'd the I today?

Amanpal Bhutani

English non, Yes. speaking. markets English larger we've don't versus are disclosed I speaking think our but

have over in -- we We businesses XXX have over in customers countries.

there So our GoDaddy bring is to opportunity number with of domains is customers of many capabilities. There's able great a sizable countries. we're there customers early, and and scale those our still in because at

So market. what the be we about is, to bringing it we're continue excited what to

Australia. our Canada markets, are and U.K., markets English actual our of terms biggest In

bigger So those businesses. are our

bit for. can maybe of So looking do that's math you what if a you're

Christie Masoner

Citi. Our next question Ygal comes from from the line of Arounian

Ygal Arounian

point, should we you of did, thinking in about a pre-XQ last relative revenue. maybe And the acceleration. the we guide [ we I paint ] but got some to to ahead on to of comps, tougher comps the be bookings translates you We in Back us may particular. revenue disclosed help understand have bookings help do the top could this line how the how translation. have lot aren't why quarter more? or kind A&C the to X A&C, the to picture I to people that seeing acceleration if we're looking points missed 'XX? but it what At are A&C translation the it have comps, on this

Mark McCaffrey

I'll take that first half, Ygal.

we're Just a other And good we then seeing of transaction in is reminder, have transactional revenue, a saw today a have we a mixture which this in are performance we good the subscription. both. A&C, within And performance quarter but in subscription. which areas, commerce, revenue also

a time, anywhere of from the the further to quarters. go So revenue contribute immediately timing related we and bookings as can be acceleration within through will out revenue start to period to the quarter over to of the

continue some We'll saw of obviously, rest different this nature right? as the we'll depending there. But this we momentum XXXX, products the the transaction of it's that we we they periods to in the year. combination of And of hit So So can remember, to going get a see on bundle, the or combination have both, buy. contribution in quarter. in the

Amanpal Bhutani

always have QX, offline. Ygal, you numbers can but and just, And it at on least, the you I take believe should for A&C bookings QX

Ygal Arounian

then And on the Okay. bundling.

some time. we expect think, around over to But security. be I key you I what's next in focus bundles details going of now and the e-mail mostly on there's So just future. would come Any really guess after Maybe and if understanding in more productivity out, more about the then hear to the pipeline is you a roll can? helpful. the that hit is that's coming

Amanpal Bhutani

the value go the is and about to the the to trying their right? relationship want approach product, us. right? we whole customer for not across We're this board, about really Like and with customer the create Ultimately,

see or products something the are going year the all So over next of sort X. to

A&C the promises very is, example, any for in business. making the of we're websites products that excited it, about some on but Not

of days businesses. Just ARPU unrelated micro named to the as tech-grade us, website a #X completely builder AI couple Airo for

So we're definitely opportunity that the one. Airo, getting not think some But that's there's some great momentum there. And business. with only in we

are in well at bundling products, Our of different ways. significant other and many will scale to lend themselves them

Mark McCaffrey

forward. starts that to and with us can really consolidated position path data that to have even bundles what now Yes. The a give that start technology we're allows and we advantage the we bundles engagement give customers, is to look as helps the what ability only us customers. to attractive we have we see to those at are behaviors starting as the the the to and to Airo value further and our analyze to stack

Amanpal Bhutani

Yes. real to little Ygal, And a we cycles renewal So see happen of customer not for progression in that one our a years, operations, able There we it's this on be everything behavior, an right? there bit to have program can the quarter, where next to customers. of over day. order working is the thing one the of the getting X, value certain hit to X -- is

Christie Masoner

Our next comes [ question from Alex from of Losinger line UBS. ] the

Christopher Kuntarich

line. You on the got Chris

the couple over that back have customers attach in going said maybe to of XX% comments a X-plus you've products. quarters Just of that now

of base? X, curious customers finer if they existing Just go you could new propensity a the in? attach point customers the X type a on Are Do to plus new existing coming X, put versus versus customers? to have higher

Amanpal Bhutani

that we're the offering, right Chris, more about We're very metric products talks paid Airo is Yes. about with customers Mark engaging right? But that's the away. products. lot a excited

expect So what for as we that we'll customers new they grow. customers, trend engage we to renewal number of adding us. sort has see broadly, a good happen products cycles, when those been see But is more continuing come to products, our these to across

Mark McCaffrey

something has that's building this over time. And been

faster X at XX% I than customer they was new customer years out trend think end we were the year metric And continues, of gave attach rate X, the that the right? -- a ago. at

They're into to finer hit not product when X-plus point when engage. a they they means coming And it And are that that free we that can on in with can just levels. said, the Aman intent. after customers pay, a at engaging different trial. come it count Our come renewal,

they higher past. it So time, engaging saw a in definitely rate we are than level the takes at but

Christopher Kuntarich

here. smaller it Got one-off [indiscernible]. not thinking helpful. quarters seems why really a couple right approach follow-up way like term? be margins. Any And control of to just It about cost be sticking one this may has it. to over maybe you It are over the the medium XX% A&C incremental Very where guys been on you're very here reason a and

Mark McCaffrey

and our tailwind margin. drive is the would basis. a on which nothing overall just about our call EBITDA we over the our one-off that time will There's pie more a going create had being business out talked higher-margin forward. is things normalized to X of This profitability A&C growing, to

As we start to GABI, our more within of tap use into P&L down. and global talent create pool, we'll that will up leverage

forward, in we have we agile, technology, ability that to have that our to purpose the for invest continue operations. sure journey efficient not fit invest then And new make trying simplification. an and we're in but continue going back-office business operational we're We're and to only on

and pillars we're becoming X into bookings had So those tailwind coming year. talked growth now really about is that intact. we And still seeing the the remain A&C that what

Christie Masoner

Our of Khan from next from comes the B. Naved question line Riley.

Naved Khan

now? you hear Can me

Unknown Executive

Yes.

Naved Khan

somebody are on I given little A&C the of apologies continues your be have And a guidance, to and piece on So I business, you that's that a guide. guiding a question higher-margin late. also the if XQ the margins on specifically business. already jumped in is the Why quarter-on-quarter? bigger But asked this. compression to EBITDA

of for So And have a that just kind follow-up. unpack then me? I

Mark McCaffrey

Yes.

we're -- the year. think our on with happy through expansion margin I

will for our mix and that at XX%, and look at margin. rate will moving. at QX opportunities We remain year. us is how the into the obviously, We our And on talked we continue keeping We levels. look believe continue the at in to XX% product QX exit the same at QX about overperformed momentum

our and flow dollar raising of cash to to absolute that doing on about obviously, a to talked our bottom free line the well. revenue, Because our feel an falls well, and percentage we flow guidance cash lot free raise unlevered bookings and guidance in good allows as are us about our related

Naved Khan

seen every these your comments some around us that? with on about improvement X it. color you And then around Just correctly. maybe X, optimize give conversion attach conversions remember on card X Aman, on effect then Got rates? started the or I if is I time now in experience an like a add Airo, Have and you launches and cards having you and the what think

Amanpal Bhutani

introduce a be the more, to simple for customers. on we experience careful we've really where our very thing got picking they're Now keep as to interesting

to actually, what are evolve number the continue So cards there that a get higher experiments to like customers. look engagement of with the

simpler, the different only trying sorts to when teams different of new of the want we in disappearing all growing changing things And more cards to order There's there we are include combinations. make it's and we done. frankly, add is lots from Airo. to things. out The And can to this saying lots

can our the So us, yes, scale, the beauty a the can products that's get with can we we we name. we a a if And That's it's of value for a humble customers. constant area our also of in right? can of focus the lot that have engagement, bring monetization. to but get We of discovery pack breadth domain and

we're And at and our lots scale, doing of lots experiments.

it's for but Airo that future be about how We it And Mark the well to small well. work we not our reasons, of today, the have say, pretty in this are and trained that very represents in us. teams excited excited as likes That's it. what might understanding do one we're about to are guide, in

Naved Khan

up on on where kind would of maybe Airo, sort if it's follow I of a just that. with How ask If journey you you, are yourself? place you that X-inning So game? to

Amanpal Bhutani

are in an inning, early We Naved.

Mark McCaffrey

lot there's go on I pitch, exciting there. and going say of to was a first lot to So we're right? a things going in the

Christie Masoner

I'll for Thank Aman you. call closing Q&A. the our concludes to remarks. turn That back

Amanpal Bhutani

recognize Thank work. builder the to good Christie. I all for our #X always sets It's employees a great all for quick you, website shot out joining a it think the tone GoDaddy us for Thank Airo and And to being recently. you just named company. at see somebody

very you quarter. see much, So and you we'll next thank

GoDaddy (GDDY) 1 Aug 242024 Q2 Earnings call transcript