Summary
GoDaddy closed fiscal 2023 with a strong fourth quarter. Revenue for the quarter ended December 31, 2023, reached $1.10 billion, up 5.8% from the prior-year quarter. Full-year revenue was $4.25 billion, up 4.0% from 2022. Operating income for the quarter was $189.9 million, up 40.8% year over year. For the full year, operating income was $547.4 million, up 9.7%. Net income attributable to GoDaddy Inc. was $1.11 billion in the quarter, up from $93.6 million in the prior-year quarter. Full-year net income attributable to GoDaddy Inc. was $1.37 billion, up 290.3% from $352.2 million in 2022. The quarter's net income included a non-cash benefit from the release of the majority of the valuation allowance on U.S. and state deferred tax assets. Diluted earnings per share for the full year was $9.08.
Operating cash flow for the quarter was $297.7 million, up 43.1% year over year. For the full year, operating cash flow was $1.05 billion, up 6.9%. Capital expenditures were $4.0 million in the quarter, down 76.6% from the prior-year quarter. Full-year capital expenditures were $42.0 million, down 29.6%. Deferred revenue, current portion, stood at $2.07 billion at December 31, 2023, up 6.2% from a year earlier. Remaining performance obligations were $2.88 billion, up 5.6%. Operating margin expanded to 17.3% in the quarter, up 4.3 percentage points from the prior-year quarter. For the full year, operating margin was 12.9%, up 0.7 percentage points.
The company's non-GAAP metrics also showed momentum. Fourth-quarter bookings were $1,123.9 million, up 6.9% year over year. Full-year bookings were $4,603.1 million, up 4.3%. Normalized EBITDA for the quarter was $324.2 million, up 22% year over year, with a margin of 29.5%. Full-year Normalized EBITDA was $1,134.5 million, up 12.0%, with a margin of 26.7%. Free cash flow in the quarter was $305.1 million, up 51.3% year over year. Full-year free cash flow was $1,084.4 million, up 12.0%. Unlevered free cash flow was $346.6 million in the quarter, up 45.5%, and $1,254.2 million for the full year, up 14.4%. Total customers at period end were 21,026 thousand, up 0.6%. Average revenue per user was $203, up 3.0%. Annualized recurring revenue was $3,690.8 million, up 3.4%. Gross payments volume from commerce offerings grew to $1.7 billion, up 125% year over year. Gross merchandise volume was $36 billion, up 26%. The company launched its AI experience, GoDaddy Airo, in the U.S. during the quarter.
Guidance for the first quarter of 2024 calls for revenue of $1.085 billion to $1.105 billion, representing 6% growth at the midpoint versus the same period in 2023. For the full year 2024, GoDaddy targets revenue of $4.480 billion to $4.560 billion, also 6% growth at the midpoint versus the $4.25 billion generated in 2023. First-quarter 2024 Normalized EBITDA margin is expected to be 27%. Full-year 2024 Normalized EBITDA margin is expected to be approximately 29%, with a fourth-quarter margin of approximately 31%. The company expects full-year 2024 unlevered free cash flow of at least $1.4 billion, versus $1.3 billion in 2023, and free cash flow of at least $1.2 billion, versus $1.1 billion in 2023. The 2024 modeling guide includes capital expenditures of $35 million, cash interest on long-term debt of $155 million, and cash income taxes of $30 million.
Several risks and other items deserve attention. The company recorded restructuring and other charges during the quarter and full year. In January 2024, GoDaddy repriced $1.8 billion of term loans, lowering interest rate margins by 0.5%, which is expected to reduce annual cash interest expense by approximately $22.0 million. The company repurchased 34.2 million shares for $2.6 billion from January 1, 2022, through February 1, 2024, at an average price of $74.99, reducing fully diluted shares by approximately 20% from those outstanding as of December 31, 2021. The forward-looking statements highlight risks including macroeconomic conditions, inflation, interest rates, competition, dependence on payment card networks, security breaches, and the deployment of new technologies such as artificial intelligence. The company also noted uneven demand patterns related to inflation and continued economic uncertainty.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2023 | Q3 FY2023 | QoQ | Q4 FY2022 | YoY |
|---|---|---|---|---|---|
| Revenue | $1.10B | $1.07B | +2.9% | $1.04B | +5.8% |
| General & administrative | $95.6M | $91.6M | +4.4% | $98.6M | -3.0% |
| Total operating expenses | $910.4M | $902.6M | +0.9% | $905.0M | +0.6% |
| Operating income (loss) | $189.9M | $167.1M | +13.6% | $134.9M | +40.8% |
| Operating margin | 17.3% | 15.6% | +1.6 pp | 13.0% | +4.3 pp |
| Net income (loss) | $1.11B | $131.0M | +750.5% | $93.8M | +1087.7% |
| Net margin | 101.3% | 12.3% | +89.0 pp | 9.0% | +92.2 pp |
Risks
GoDaddy identified a material weakness in the design of controls related to accounting for income taxes and related disclosures and concluded internal control over financial reporting was not effective as of December 31, 2023. The company may not remediate in the near term, which could impair timely and accurate financial reporting and pressure the stock price.
GoDaddy launched GoDaddy Airo in the U.S. in 2023 and is increasingly using AI, including generative AI, in its offerings. Risks include intellectual property infringement, data privacy, cybersecurity, regulatory scrutiny, and competition from rivals with superior or more cost-effective AI products.
GoDaddy has experienced multiple cybersecurity incidents, including a 2020 compromise of approximately 28,000 hosting customer credentials, a 2021 Managed WordPress breach affecting up to 1.2 million customers, and 2022 cPanel malware. It faces frequent sophisticated attacks, DDoS, social engineering, and nation-state threats, with potential regulatory inquiries and liability.
GoDaddy faces significant and intensifying competition in Applications and Commerce and Core Platform from providers such as Shopify, Wix, Squarespace, Google, Amazon, and Microsoft, as well as low-cost or free offerings from Cloudflare and Let's Encrypt. Competitors with greater resources could pressure pricing, margins, and market share.
A substantial portion of GoDaddy's cloud infrastructure is provisioned through AWS, and AWS may terminate or suspend services for cause. Any disruption or capacity constraint at AWS could interrupt product availability, harm reputation, and increase costs.
The 2023 restructuring plan reduced headcount by approximately 550 employees in February and about 250 more in Q3, with $90.8 million of restructuring and other charges in 2023. Risks include additional workforce attrition, operational disruptions, and failure to achieve expected cost savings or margin improvement.
Inflation, higher interest rates, recession risk, and geopolitical conflicts, including Russia-Ukraine and Middle East tensions, could reduce demand and customer spending. MD&A states bookings growth was impacted by uneven demand patterns related to inflation and continued economic uncertainty.
GoDaddy has significant long-term debt with restrictive covenants, and interest expense increased 22.4% to $179.0 million in 2023. The debt could limit flexibility, divert cash flow from operations, and expose the company to interest rate risk.
Starboard Value L.P. reported approximately 6.2% beneficial ownership as of January 2024. Activist involvement could disrupt operations, divert management attention, and cause stock price fluctuations.
GoDaddy Payments is subject to money transmission, consumer protection, and payment card network rules, and could face fines, holdbacks, or termination of card acceptance. Fraudulent or illegal transactions processed for customers could cause substantial losses and regulatory inquiries.
Evolving technologies, social media reliance, search engine algorithm changes, and alternative internet traffic systems could reduce the value and demand for domain names and GoDaddy's websites. If the company fails to integrate with these applications and devices, it may lose market share.
Bookings outside the U.S. represented approximately 33% of total bookings in 2023, exposing GoDaddy to foreign regulatory, tax, currency, and geopolitical risks. Conflicts in Russia-Ukraine and the Middle East and higher-risk operations in India could impair growth prospects.
SaaS KPIs
All quarters →Total bookings
Unlevered free cash flow
Free cash flow
Average revenue per user (ARPU)
Total customers at period end
Annualized Recurring Revenue (ARR)
Normalized EBITDA (NEBITDA)
Gross Merchandise Volume (GMV)
Summary, forecast, risks and KPIs are extracted from GoDaddy Inc.'s SEC filings for Q4 FY2023 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 1, 2026.