Apps stock

GoDaddy Third Quarter Revenue Beats Expectations Due to Rise in Business Apps and Inventory Jumps

Shares of domain hosting and e-commerce specialists GoDaddy jumped 5% late in the session after the company reported third-quarter revenue above expectations and above its fourth-quarter revenue outlook.

CEO Aman Bhutani, in prepared remarks, trumpeted “a record number of net new customers and acceleration in all three product categories”, referring to the three elements of the company’s revenue line, the domains, the hosting and presence and business applications.

The company also announced that its COO, Andrew Low Ah Kee, was leaving for a position at another company. Bhutani thanked Kee for making “incredible contributions”.

GoDaddy added more than one million customers this year, net of churns, which is its highest nine-month add-on rate in history, the company noted.

Revenue for the quarter ended September increased 11% year-over-year to $ 844.4 million, more than the average estimate of $ 835 million. Earnings per share of 38 cents, however, missed the consensus forecast of $ 1.07.

CFO Ray Winborne said the company “saw accelerated bookings and revenue growth this quarter, as well as 17% year-over-year growth in unleveraged free cash flow.” Winborne also noted the company’s successful integration of four acquired companies this year.

GoDaddy’s Domains category revenue grew 12.2% year-over-year to $ 387.4 million, while hosting and presence revenue grew 6. 1% to $ 302.4 million. Business applications revenue was the big winner, up nearly 19% to $ 154.6 million.

For the current quarter, the company sees another 11% increase in revenue, to about $ 865 million, which is higher than the average estimate of $ 856 million.

The outlook by product is similar this quarter, with GoDaddy forecasting domain revenue to grow by a percentage figure, hosting revenue to be in the middle of a figure, and commercial applications to grow by a high percentage.

GoDaddy stock was up 4% to $ 83.01 at the end of the session. The share had climbed 8% during the regular session.