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GDDY Q3 Earnings Beat Estimates on Revenue Growth and Airo Gains
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Key Takeaways
GDDY's Q3 earnings jumped 37.7% to $2.08 per share, while revenues rose 6% to $1.34 billion.
Airo's annualized bookings run rate surpassed $100 million, doubling from the prior quarter.
GoDaddy expects 2026 revenues near the higher end of its $5.215-$5.255 billion outlook.
GoDaddy (GDDY - Free Report) reported third-quarter 2026 earnings of $2.08 per share, up 37.7% year over year, surpassing the Zacks Consensus Estimate by 14.29%.
Revenues increased 6% year over year on a reported and constant-currency basis to $1.34 billion, beating the consensus estimate by 1.1%. Growth reflected strength across both segments, improving customer monetization and accelerating Airo adoption.
Average revenue per user (ARPU) increased 6.8% year over year to $253.
GDDY's Q3 Top-Line Performance
Total bookings increased 5.7% year over year to $1.43 billion on both a reported and constant-currency basis. Annualized recurring revenue rose 5.1% to $4.51 billion, reflecting continued expansion in subscription-based services.
International revenues increased 3.1% year over year to $435.5 million, or 3% on a constant-currency basis. GoDaddy ended the quarter with 20.5 million customers, adding 40,000 sequentially and 75,000 since the end of 2025.
GoDaddy's Segment Results Show Broad Growth
Applications and Commerce revenues increased 9% year over year to $524.3 million. Growth was supported by productivity and commerce solutions, partially offset by the ongoing migration from Websites + Marketing to Airo. Segment bookings rose to 8% from 7% in the prior quarter.
Applications and Commerce EBITDA rose 11.9% year over year to $246 million. Its EBITDA margin expanded 120 basis points to 46.9%, reflecting continued profitability improvements despite the product transition.
Core Platform revenues increased 4.2% year over year to $817.5 million. Growth was driven by stronger aftermarket activity, increased high-value transactions and healthy demand for primary domain registrations and renewals.
Core Platform EBITDA increased 4% year over year to $268.9 million. However, its EBITDA margin contracted 10 basis points to 32.9%.
GDDY Benefits From Accelerating Airo Adoption
Airo remained central to GoDaddy’s AI transformation. Its annualized bookings run rate surpassed $100 million, more than doubling from $50 million in the preceding quarter and increasing from $10 million two quarters earlier.
Management highlighted that Airo contributed incrementally to bookings growth for the first time, more than offsetting the impact of legacy website product migrations. Growth was primarily driven by existing customers adopting lower-priced starter plans and purchasing additional AI credit packs.
Airo became the default website-building option in the domain-purchase path late in the quarter. Management reported encouraging conversion and product attachment rates, with new Airo customers adding a second paid product approximately 70% of the time.
GoDaddy also expanded its Developer Platform with APIs spanning domains, hosting, professional email and commerce. The company continues developing its Agent Name Service initiative to support verified identities and interactions across AI agents.
GoDaddy’s Profitability Expands
Normalized EBITDA increased 10% year over year to $449.3 million. The normalized EBITDA margin expanded 120 basis points to 33.5%, supported by revenue growth, operating leverage and expense discipline.
Operating income surged 22.2% year over year to $362.5 million, while the operating margin expanded 360 basis points to 27%. Net income increased 24.4% to $261.8 million, with the net margin improving to 19.5% from 16.6%.
Management acknowledged that Airo carries lower gross margins than legacy software products because of AI inference costs. However, operating efficiencies and efforts to optimize model usage are expected to support continued normalized EBITDA margin expansion.
GDDY’s Cash Flow and Balance Sheet
As of Sept. 30, 2026, cash and cash equivalents totaled $1.12 billion. Total debt stood at approximately $3.8 billion, while net debt was $2.7 billion. The trailing-12-month net leverage ratio was 1.4 times.
Net cash provided by operating activities increased 9.8% year over year to $487.7 million. Free cash flow rose 9.1% to $480.8 million, while trailing-12-month free cash flow reached $1.8 billion.
During the quarter, GoDaddy repurchased 5 million shares for $477 million. Through Oct. 26, year-to-date repurchases totaled 15.7 million shares for $1.4 billion.
GoDaddy Targets Higher End of 2026 Revenue Outlook
GoDaddy expects full-year 2026 revenues toward the higher end of its previously announced $5.215-$5.255 billion range. The midpoint represents approximately 6% year-over-year growth.
Management anticipates Applications and Commerce revenue growth of approximately 10% and Core Platform growth of approximately 4% for 2026. Fourth-quarter bookings growth is expected to accelerate and slightly exceed revenue growth, excluding currency impacts, supported by increasing Airo adoption.
The company reaffirmed its full-year normalized EBITDA margin target of more than 33% and free cash flow outlook of approximately $1.8 billion. Management expects continued operating leverage and AI-driven productivity improvements to support profitability while funding investments in AI products, marketing, and infrastructure.
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GDDY Q3 Earnings Beat Estimates on Revenue Growth and Airo Gains
Key Takeaways
GoDaddy (GDDY - Free Report) reported third-quarter 2026 earnings of $2.08 per share, up 37.7% year over year, surpassing the Zacks Consensus Estimate by 14.29%.
Revenues increased 6% year over year on a reported and constant-currency basis to $1.34 billion, beating the consensus estimate by 1.1%. Growth reflected strength across both segments, improving customer monetization and accelerating Airo adoption.
Average revenue per user (ARPU) increased 6.8% year over year to $253.
GDDY's Q3 Top-Line Performance
Total bookings increased 5.7% year over year to $1.43 billion on both a reported and constant-currency basis. Annualized recurring revenue rose 5.1% to $4.51 billion, reflecting continued expansion in subscription-based services.
GoDaddy Inc. Price, Consensus and EPS Surprise
GoDaddy Inc. price-consensus-eps-surprise-chart | GoDaddy Inc. Quote
International revenues increased 3.1% year over year to $435.5 million, or 3% on a constant-currency basis. GoDaddy ended the quarter with 20.5 million customers, adding 40,000 sequentially and 75,000 since the end of 2025.
GoDaddy's Segment Results Show Broad Growth
Applications and Commerce revenues increased 9% year over year to $524.3 million. Growth was supported by productivity and commerce solutions, partially offset by the ongoing migration from Websites + Marketing to Airo. Segment bookings rose to 8% from 7% in the prior quarter.
Applications and Commerce EBITDA rose 11.9% year over year to $246 million. Its EBITDA margin expanded 120 basis points to 46.9%, reflecting continued profitability improvements despite the product transition.
Core Platform revenues increased 4.2% year over year to $817.5 million. Growth was driven by stronger aftermarket activity, increased high-value transactions and healthy demand for primary domain registrations and renewals.
Core Platform EBITDA increased 4% year over year to $268.9 million. However, its EBITDA margin contracted 10 basis points to 32.9%.
GDDY Benefits From Accelerating Airo Adoption
Airo remained central to GoDaddy’s AI transformation. Its annualized bookings run rate surpassed $100 million, more than doubling from $50 million in the preceding quarter and increasing from $10 million two quarters earlier.
Management highlighted that Airo contributed incrementally to bookings growth for the first time, more than offsetting the impact of legacy website product migrations. Growth was primarily driven by existing customers adopting lower-priced starter plans and purchasing additional AI credit packs.
Airo became the default website-building option in the domain-purchase path late in the quarter. Management reported encouraging conversion and product attachment rates, with new Airo customers adding a second paid product approximately 70% of the time.
GoDaddy also expanded its Developer Platform with APIs spanning domains, hosting, professional email and commerce. The company continues developing its Agent Name Service initiative to support verified identities and interactions across AI agents.
GoDaddy’s Profitability Expands
Normalized EBITDA increased 10% year over year to $449.3 million. The normalized EBITDA margin expanded 120 basis points to 33.5%, supported by revenue growth, operating leverage and expense discipline.
Operating income surged 22.2% year over year to $362.5 million, while the operating margin expanded 360 basis points to 27%. Net income increased 24.4% to $261.8 million, with the net margin improving to 19.5% from 16.6%.
Management acknowledged that Airo carries lower gross margins than legacy software products because of AI inference costs. However, operating efficiencies and efforts to optimize model usage are expected to support continued normalized EBITDA margin expansion.
GDDY’s Cash Flow and Balance Sheet
As of Sept. 30, 2026, cash and cash equivalents totaled $1.12 billion. Total debt stood at approximately $3.8 billion, while net debt was $2.7 billion. The trailing-12-month net leverage ratio was 1.4 times.
Net cash provided by operating activities increased 9.8% year over year to $487.7 million. Free cash flow rose 9.1% to $480.8 million, while trailing-12-month free cash flow reached $1.8 billion.
During the quarter, GoDaddy repurchased 5 million shares for $477 million. Through Oct. 26, year-to-date repurchases totaled 15.7 million shares for $1.4 billion.
GoDaddy Targets Higher End of 2026 Revenue Outlook
GoDaddy expects full-year 2026 revenues toward the higher end of its previously announced $5.215-$5.255 billion range. The midpoint represents approximately 6% year-over-year growth.
Management anticipates Applications and Commerce revenue growth of approximately 10% and Core Platform growth of approximately 4% for 2026. Fourth-quarter bookings growth is expected to accelerate and slightly exceed revenue growth, excluding currency impacts, supported by increasing Airo adoption.
The company reaffirmed its full-year normalized EBITDA margin target of more than 33% and free cash flow outlook of approximately $1.8 billion. Management expects continued operating leverage and AI-driven productivity improvements to support profitability while funding investments in AI products, marketing, and infrastructure.
GDDY’s Zacks Rank & Stocks to Consider
GoDaddy currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the broader Zacks Computer and Technology sector include ACI Worldwide (ACIW - Free Report) , Affirm (AFRM - Free Report) and AMETEK (AME - Free Report) . While AFRM and AME sport a Zacks Rank #1 (Strong Buy), ACI Worldwide carries a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
ACI Worldwide shares have gained 16.5% in the year-to-date period. ACI Worldwide is set to report third-quarter 2026 results on Nov. 5.
Shares of Affirm have risen 0.5% year to date. Affirm is set to report first-quarter fiscal 2027 results on Nov. 5.
Shares of AMETEK have rallied 22.6% year to date. AMETEK is slated to report third-quarter 2026 results on Nov. 3.