GoDaddy Inc. (NYSE:GDDY) Q2 2023 Earnings Call Transcript

Obviously, it helps to — with our cash flow, and it helps us be more efficient because we’re getting greater revenue prices or getting better revenue and a better efficient operating margin as well. So, we feel really good about all that happening in the applications and commerce. It’s really driving a lot of momentum. We have that on top of the hardware sales that we are seeing that are driving that momentum as well, a lot of positivity coming right? And it all starts with the domain and innovating in the demand.

Unidentified Analyst: Got it. Thank you, guys. Appreciate it.

Christie Masoner : Our next question comes from the line of Ygal Arounian from Citi. Ygal please go ahead.

Ygal Arounian : I’m not re-asking this, but I want to start on domains. We continue to kind of see some, let’s say, challenging growth from [indiscernible]. I know you guys are involved in, and other TLDs two, which if there’s interesting things to point out about that, we’d love to hear. But just maybe just some of what you’re seeing around that expectations for when that can start to normalize, how that’s impacting the aftermarket? And then a really interesting comment about channel partners who are pushing more on ARPU than they were on new users. And I don’t know if there’s something to comment around that? Do you think that, that’s having an impact? You guys have a big hand in both sides. So, would love to hear your view on that.

Aman Bhutani: Yes. Happy to give a bit of color on domains. Obviously, I think you probably saw already domains under management for GoDaddy grew. So definitely, we’re doing well on units as well. And to sort of explain a little bit where — as Mark said, we’re seeing better traffic and demand coming to our site. As I mentioned in my prepared remarks, some of that is because of our focus in search engine marketing and us significantly improving our abilities to spend money and search and convert those customers. So, we’re very happy with that as well. And one other maybe mentions to mention to you is that we’ve continued to grow well internationally. As Mark shared, we grew 6% internationally on a reported basis, 3% constant currency, 6%.

And the product we lead with internationally is domains, right? Domains is the number one thing we sell in small markets around the world, we have customers in over 100 markets. So, it’s the combination of those things that I would say that are leading to the best results for us. And our Domains business is broader than any other one particular registry business. You mentioned that yourself, and that’s absolutely true. We’re the market leader. We have a diverse set of assets within the domains business. We’ve continued to innovate in many of those areas. And the key pieces where we see good returns this we’ll be very efficient in marketing and search, grow the dumps, grow the customers, get customers to the stick, can work them while attach products to them, which obviously isn’t what you’re asking about, but attach rate products to them and do it around the world really well.

Hopefully, that’s a bit helpful.

Ygal Arounian : Yes. That’s really helpful. And so maybe to segue, I think it’s similar. I don’t know. A lot of the answers might actually be an overlap. But if there’s anything incremental to add. So, just on the gross top of the funnel, gross adds commentary, which feels really strong. And I know you have some noise in your in the new customer number, I believe, still ongoing with some of the sunsetting of the brands. Is there any way to parse out that? And then what — is it — to your point, when you talk about with the SEM work that you’re doing that’s driving that strength in the top of funnel with domains. Even if your domains under management grew, demand is kind of like, let’s say, collectively still soft your commentary around the really strong top of the funnel, I think, stands out. So, I wanted to maybe understand that a little bit better. Thank you.