Domain registrar and web services company GoDaddy (NYSE:GDDY) beat Wall Street's revenue expectations in Q3 2026, with revenue rising 6% year on year to $1.34 billion. The company expects the full year's revenue to be around $5.24 billion, close to analysts' consensus estimates. Its GAAP profit of $2.08 per share was 9.6% above analysts' consensus estimates.
For more on GoDaddy, read our full research report .
GoDaddy (GDDY) Q3 2026 highlights:
-
Revenue$1.34 billion vs S&P analysts' consensus estimates of $1.33 billion (6% year-on-year growth, 1.1% beat)
-
EPS (GAAP)$2.08 vs analysts' consensus estimates of $1.90 (9.6% beat)
-
Adjusted EBITDA$449.3 million vs analysts' consensus estimates of $441.3 million (33.5% margin, 1.8% beat)
-
Revenue guidanceThe company reconfirmed its revenue guidance for the full year of $5.24 billion at the midpoint
-
Operating margin27%, up from 23.4% in the same quarter last year
-
Free cash flow margin35.8%, up from 34.2% in the previous quarter
-
Annual recurring revenue$4.51 billion vs analysts' consensus estimates of $4.53 billion (5.1% year-on-year growth, in line)
-
Billings$1.36 billion at quarter end, up 5.4% year on year
-
Market capitalization$13.49 billion
Revenue growth
A company's long-term revenue performance can indicate its overall quality. Any business can deliver a good quarter or two, but many enduring ones grow for years. GoDaddy's revenue grew at a weak 7.1% compounded annual growth rate over the last five years, falling short of our standard for the software sector.
Long-term growth matters most, but within software, a half-decade historical view may miss recent innovations or disruptive industry trends. GoDaddy's annualized revenue growth of 7.5% over the last two years aligns with its five-year trend, suggesting its demand was consistently weak.
This quarter, GoDaddy reported year-on-year revenue growth of 6%, and its $1.34 billion of revenue exceeded Wall Street's consensus estimates by 1.1%.
Looking ahead, sell-side analysts expect revenue to grow 4.9% over the next 12 months, according to S&P, a slight deceleration versus the last two years. This projection is underwhelming and suggests its products and services will see some demand headwinds.
Annual recurring revenue
While reported revenue for a software company can include low-margin items like implementation fees, annual recurring revenue (ARR) is the sum of the next 12 months of contracted revenue purely from software subscriptions, or the high-margin, predictable revenue streams that underpin the value of SaaS businesses.
GoDaddy's ARR came in at $4.51 billion in Q3, and over the last four quarters, its growth was underwhelming as it averaged 6% year-on-year increases. This performance mirrored its total revenue and suggests that increasing competition is causing challenges in securing longer-term commitments.
Customer acquisition efficiency
The customer acquisition cost (CAC) payback period represents the months required to recover the cost of acquiring a new customer. Essentially, it's the break-even point for sales and marketing investments. A shorter CAC payback period is ideal, as it implies better returns on investment and business scalability.
GoDaddy is highly efficient at acquiring new customers, and its CAC payback period was 5.8 months this quarter. The company's rapid recovery of its customer acquisition costs means it can attempt to spur growth by increasing its sales and marketing investments.
Key takeaways from GoDaddy's Q3 results
GoDaddy's quarter was mixed: revenue narrowly topped analysts' consensus estimates, but annual recurring revenue was in line with expectations and the Company reaffirmed full year guidance. Shares fell 3.6% to $102.12 immediately after the results.
Is GoDaddy a buy at the current price? The latest quarter matters, but not nearly as much as longer-term fundamentals and valuation when deciding whether to buy. Read our free full research report here .
