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GoDaddy shares fall after AI strategy outlook disappoints investors
GoDaddy said it expects third-quarter revenue of $1.32 billion to $1.34 billion, while analysts flagged slower Applications and Commerce bookings growth.
GoDaddy (NYSE: GDDY) reported quarterly results that beat consensus on revenue and earnings, but the stock fell about 12% as investors focused on how well its AI push will translate into faster growth. The company posted earnings of $1.83 per share, above the consensus by $0.14, with revenue up 7% year over year to roughly $1.30 billion.
Total bookings rose 6% to $1.4 billion, yet Wells Fargo analyst Alec Brondolo pointed to a slowdown in Applications and Commerce bookings growth to 7% year over year from 9% in the prior quarter. He said the deceleration reflects growing consumer demand for agentic AI products, prompting management to accelerate the launch of its Airo AI platform while reducing investment in legacy Applications and Commerce offerings.
Brondolo warned the transition is likely to remain noisy through the second half of 2026 and into 2027, and the stock was downgraded by William Blair from Outperform to Market Perform. Piper Sandler kept a Neutral rating, saying it still does not see a clear catalyst for revenue growth to reaccelerate.
GoDaddy also outlined third-quarter revenue guidance of $1.32 billion to $1.34 billion. Yahoo Finance also noted that the company’s Airo annualized bookings run rate rose 5x in a single quarter to $50 million, and that normalized EBITDA margin increased by more than 200 basis points to 33%, with free cash flow at $443 million.