Slide 1: Q3 2023 Financial Results
Q3 2023 Financial Results November 2, 2023 Joanne Diver The Backyard Garden Enthusiast BACKYARDGARDENENTHUSIAST.COM.AU © 2023 GoDaddy Inc.
Slide 2: Forward-looking statements and non-GAAP financial measures
Forward–looking statements and non-GAAP financial measures This presentation contains forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on estimates and information available to us at the tim
Slide 3: Our vision and mission
Our vision is to radically shift the global economy toward life-fulfilling entrepreneurial ventures. Our mission is to empower entrepreneurs everywhere, making opportunity more inclusive for all. Joanne Diver The Backyard Garden Enthusiast BACKYARDGARDENENTHUSIAST.COM.AU 3 © 2023 GoDaddy Inc.
Slide 4: Delivering shareholder value
Delivering shareholder value Expanding Driving profitable Compounding free Normalized EBITDA growth cash flow per share margins Jeremy Strebel Jammin On JAMMINON.COM As of September 30, 2023 4 © 2023 GoDaddy Inc.
Slide 5: Third quarter turning point
Third quarter turning point 12% 28% ~31% Q3 2023 Targeted Q4 2024 Application & Commerce Normalized EBITDA Normalized EBITDA Bookings growth margin margin Jeremy Strebel Jammin On JAMMINON.COM As of September 30, 2023 5 © 2023 GoDaddy Inc.
Slide 6: Partnering with our customers at every point on the Entrepreneur's Wheel
Marketplaces and social media Digital Partnering with Messaging commerce Identity our customers at Payments Domain every point on the Logo Entrepreneur’s Connected Email Wheel Commerce Link in Bio Create posts Website Online store Hosting and security Physical store Offline point-of-sale Ubiquitous
Slide 7: Delivering a one-stop shop for small businesses
Delivering a one-stop shop for small businesses Tools to sell Sell anything Sell anywhere anything, anywhere Emma McLeavy Jo + Co. Hampers & Floral design THEHULA.COM 7 © 2023 GoDaddy Inc.
Slide 8: Strategic priorities driving innovation and customer success
Innovating in domains Driving commerce Delivering for & productivity through presence GoDaddy Pros Strategic With each new domain First web builder to Product improvements in priorities purchase, GoDaddy Airo™ automatically delivers: integrate Google’s Business Messages into GoDaddy Managed Wo
Slide 9: GoDaddy Airo: Transforming the way successful small businesses grow using AI
GoDaddy Airo: Transforming the way successful small businesses grow using the power of AI Commerce-enabled Social media personalized website Branding Logo marketing messages 9 © 2023 GoDaddy Inc.
Slide 10: Key strategic highlights
Key strategic highlights Continuing margin expansion in 2024 and enhancing profitability further in 2025 and 2026 Innovating around integrated AI- powered solutions for our customers with a one-stop shop experience Driving expanded lifetime value through bundling more integrated solutions for our lo
Slide 11: Durable and profitable revenue model with loyal customer base
Durable and profitable revenue model with loyal customer base 42% 50%+ ~85% Applications & Customer Customers with Commerce segment retention two or more products EBITDA margin rate Tanika “Nika” Nelson Nika’s Cupcake Bar NIKASCUPCAKEBAR.COM As of September 30, 2023 11 © 2023 GoDaddy Inc.
Slide 12: Impressive growth in high-margin applications & commerce
Impressive growth in high-margin applications & commerce $1.4B+ business driving accelerated profitability Q3 2023 revenue Growth levers Metrics 11% increase | ~90 bps of segment EBITDA margin improvement Product attach Customers with 2+ products $363M $326M International expansion International rev
Slide 13: Core platform delivers consistent stable base
Core platform delivers consistent stable base Comparative growth impacted by divestitures of two of our hosting brands Q3 2023 revenue ~Flat | ~90 bps of segment EBITDA margin improvement Growth levers Metrics $707M $706M Demand New customers Pricing ARPU 30% 29% Subscriptions ARR International expa
Slide 14: Maturing aftermarket revenue
Maturing aftermarket revenue Transactional business subject to global macro-economic conditions $438M Q3 2023 revenue $414M 2% decrease $109M $245M $218 $107M $191 $216 $112 $212 Q3 2022 Q3 2023 2020 2021 2022 2023E ATV Bars without numbers are intended to be illustrative 14 © 2023 GoDaddy Inc.
Slide 15: Durable track record of revenue growth over time
Durable track record of revenue growth over time $4,250M-$4,270M 4% increase $4,091M 4% constant currency $3,816M $1,070M $1,033M $3,317M 9% CAGR Q3 2022 Q3 2023 2020 2021 2022 2023E 15 © 2023 GoDaddy Inc.
Slide 16: Continuing to expand our global footprint
$346M $333M Continuing to expand our global footprint Q3 2023 International revenue 4% increase | 5% constant currency Q3 2022 Q3 2023 16 © 2023 GoDaddy Inc.
Slide 17: A growing loyal customer base that is spending more with us
A growing loyal customer base that is spending more with us 85% of total revenue is generated from customers in our base Customers ARPU $200 21.0M $196 20.9M Q3 2022 Q3 2023 Q3 2022 Q3 2023 17 © 2023 GoDaddy Inc.
Slide 18: Accelerating profitability and strong cash flow generation during Q3
Accelerating profitability and strong cash flow generation during Q3 Bookings Revenue Normalized EBITDA Unlevered Free Free Cash Flow (FCF) 5% increase 4% increase (NEBITDA) Cash Flow (uFCF) 14% per share 4% constant currency 4% constant currency 13% increase 8% increase increase $1,139M $320M $1,07
Slide 19: Accelerating margin expansion to improve profitability
Accelerating margin expansion to improve profitability Targeting Q4 2024 exit rate NEBITDA margin of ~31% ~$1.1B $1,013M $263M $296M 26%+ $872M 25% 28% $722M 25% 23% 22% 16% CAGR Q3 2022 Q3 2023 2020 2021 2022 2023E NEBITDA Margin NEBITDA Margin © 2023 GoDaddy Inc. 19
Slide 20: Opportunity to drive normalized EBITDA margin expansion by managing tech & dev expense
Opportunity to drive normalized EBITDA margin expansion by managing tech & dev expense Additionally, higher free cash flow from CapEx reduction as we move to the cloud Normalized T&D expense Tech & Dev spend Product Infrastructure ~47% ~53% Product innovation Cyber $172 $173 Front of site Public clo
Slide 21: Multi-year track record of free cash flow per share growth
Multi-year track record of delivering strong free cash flow per share growth despite rising interest rates $1.0B+ $969M $280M $856M $265M $7.25+ $745M $6.20 $6.82 $5.96 $5.07 19% $4.31 CAGR Q3 2022 Q3 2023 2020 2021 2022 2023E TTM FCF per share FCF per share 21 © 2023 GoDaddy Inc.
Slide 22: Strong balance sheet and ample liquidity
Strong balance Committed to maintaining Fixed Interest rates sheet and ample leverage ratio of 2x-4x providing stability liquidity 3.0X Fixed Variable Total liquidity of $1.3B 87% 13% 2.8X $329M in cash and 2.6X cash equivalents $1.0B undrawn revolver Reduced interest rate by 75 bps on $1.8B of
Slide 23: Disciplined capital allocation strategy to drive shareholder returns
Disciplined capital allocation strategy Achieved 20% share reduction to drive shareholder returns $2.6B Completed $2.6B in share buybacks under current authorization Reduced fully diluted share $1.3B count by approximately 20% since inception of the current 168.7M $4B authorization 143.8M 2022 Throu
Slide 24: Delivered on or ahead of Q3 targets
Delivered on or ahead of Q3 targets Growth/ Actual Prior Year Expansion Original Guidance Revenue $1,070B $1,033B 4% $1.055 - $1.075B Applications & Commerce Revenue $363 $326 11% 9% - 11% Core Platform Revenue $706 $707 - ~Flat Normalized EBITDA Margin 28% 25% ~3 pts ~26% 24 © 2023 GoDaddy Inc.
Slide 25: Driving durable growth, expanding margins & attractive cash flow
Driving durable growth, expanding margins & attractive cash flow Q4 2023 2023 Outlook Outlook Revenue $1.095B - $1.115B $4.250B - $4.270B Segment growth rates Applications & Commerce ~13% ~12% Core platform 2% - 3% Flat - 1% NEBITDA margin ~29% 26%+ Unlevered free cash flow $1.2B+ Free cash flow $1.
Slide 26: Key financial highlights and outlook
Key financial highlights and outlook Increasing Q4 2023 Normalized EBITDA margin target to ~29%; full year Normalized EBITDA margin target to 26%+ Targeting Q4 2024 Normalized EBITDA margin of ~31%; continuing expansion into 2025 and 2026 Reaffirming 2023 guidance to deliver: Unlevered free cash f
Slide 27: Appendices
Appendices 27 © 2023 GoDaddy Inc.
Slide 28: Non-GAAP reconciliation: NEBITDA
Non-GAAP reconciliation: NEBITDA Three months ended Reconciliation of NEBITDA ($M) September 30 2023 2022 Net income $131.0 $100.0 Depreciation and amortization 40.6 48.5 Equity-based compensation 76.2 65.4 Interest expense, net 39.8 32.1 Acquisition-related expenses1 (1.0) 8.9 Restructuring and oth
Slide 29: Non-GAAP reconciliation: NEBITDA
Non-GAAP reconciliation: NEBITDA Reconciliation of NEBITDA ($M) 2020 2021 2022 Net income (loss) $(494.1) $242.8 $352.9 Depreciation and amortization 202.7 199.6 194.6 Equity-based compensation expense 191.5 207.9 264.4 Interest expense, net 86.9 124.9 135.0 Acquisition-related expenses 25.0 78.2 35
Slide 30: Non-GAAP reconciliation: free cash flow
Non-GAAP reconciliation: free cash flow Three months ended September 30 Reconciliation ($M) 2023 2022 Net cash provided by operating activities $281.6 $269.9 Capital expenditures (9.4) (12.4) Cash paid for acquisition-related costs 1.3 5.2 Cash paid for restructuring and other charges1 6.7 2.8 Free
Slide 31: Non-GAAP reconciliation: free cash flow
Non-GAAP reconciliation: free cash flow Reconciliation of free cash flow ($M) 2020 2021 2022 Net cash provided by operating activities $764.6 $829.3 $979.7 Capital expenditures (66.5) (51.1) (59.7) Cash paid for acquisition-related costs1 27.4 64.9 37.9 Cash paid for restructuring charges2 19.4 12.7
Slide 32: Non-GAAP reconciliation: Net debt
Non-GAAP reconciliation: Net debt Reconciliation ($M) September 30, 2023 Current portion of long-term debt $18.0 Long-term debt 3,802.3 Unamortized original issue discount and debt issuance costs 62.1 Total debt $3,882.4 Less: cash & cash equivalents (329.2) Net debt $3,553.2 32 © 2023 GoDaddy Inc.
Slide 33: Reconciliation: Constant currency
Reconciliation: Constant currency Reconciliation ($M) September 30, 2023 Bookings $1,138.9 Constant currency adjustment (5.0) Constant currency bookings $1,133.9 Revenue $1,069.7 Constant currency adjustment 2.4 Constant currency revenue $1,072.1 33 © 2023 GoDaddy Inc.
Slide 34: Non-GAAP reconciliation: Technology & Development
Non-GAAP reconciliation: Technology & Development Reconciliation of Technology & Development ($M) Q1 2023 Q2 2023 Q3 2023 Technolog y and development $215.0 $219.2 $201.6 Equity-based compensation: technology and development (39.0) (42.0) (42.2) Acquisition-related costs (4.2) (4.3) 1.8 Technology a
Slide 35: Non-GAAP financial measures and other operating and business metrics
Non-GAAP financial measures and other operating and business metrics Total bookings Total bookings is an operating metric representing the total value of customer contracts entered into during the period, excluding refunds. We believe total bookings provides additional insight into the performance o
Slide 36: Non-GAAP financial measures and other operating and business metrics
Non-GAAP financial measures and other operating and business metrics NEBITDA margin NEBITDA margin is used by management as a supplemental measure of our operating performance and refers to the ratio of NEBITDA to revenue, expressed as a percentage. Net debt We define net debt as total debt less cas
Slide 37: Non-GAAP financial measures and other operating and business metrics
Non-GAAP financial measures and other operating and business metrics Free cash flow Free cash flow is defined as our unlevered free cash flow less interest payments for the period. We use free cash flow as a supplemental measure of our liquidity, including our ability to generate cash flow in excess
Slide 38: Q3 2023 Financial Results
Joanne Diver The Backyard Garden Enthusiast BACKYARDGARDENENTHUSIAST.COM.AU Q3 2023 Financial Results November 2, 2023 38 © 2023 GoDaddy Inc.