TLDR
- GoDaddy (GDDY) shares plummeted 16% on Wednesday, closing at $77.34 and becoming the S&P 500’s biggest decliner.
- Fourth-quarter earnings per share of $1.80 exceeded the $1.58 consensus, though bookings of $1.28B fell short of the $1.31B expectation.
- The company’s 2026 revenue outlook of $5.195B–$5.275B trailed analyst projections.
- Growth in Applications & Commerce bookings slowed to 11% from 14% following implementation of promotional pricing tactics.
- Wall Street firms aggressively lowered price targets, including RBC’s dramatic cut from $200 to $100 and JPMorgan’s reduction from $200 to $167.
GoDaddy $GDDY experienced a brutal trading session on Wednesday. Shares collapsed 16% to settle at $77.34 following the release of the company’s fourth-quarter financial results — securing its position as the S&P 500’s weakest performer for the day.
According to data from Dow Jones Market Data, this decline represents the steepest single-session percentage loss for the stock since March 2020. The closing price also marks GDDY’s lowest level since November 2023.
For 2025 to date, GoDaddy shares have declined approximately 26%, contrasting sharply with the broader market’s modest 0.6% gain.
The quarterly earnings report wasn’t entirely negative. GoDaddy delivered Q4 earnings per share of $1.80, surpassing the analyst consensus of $1.58. Top-line revenue reached $1.27 billion, matching Wall Street’s projections.
So what triggered the selloff? Two critical factors: bookings performance and forward guidance.
Fourth-quarter bookings totaled $1.28 billion, falling short of the $1.31 billion analyst estimate. The Applications and Commerce segment saw bookings growth decelerate from 14% in the third quarter to just 11% in Q4.
The company had implemented a revised go-to-market approach featuring promotional discounts on annual contracts designed to acquire new customers. The consequence was reduced initial bookings.
GoDaddy successfully onboarded 9,000 new customers during the period, up from 4,000 in the previous quarter. However, analysts expressed skepticism about the sustainability of this growth trajectory, with RBC observing that attachment rates for new customer cohorts appeared average or below.
Forward Outlook Falls Short
For the full 2026 fiscal year, GoDaddy projected revenue between $5.195 billion and $5.275 billion, representing approximately 6% growth at the range’s midpoint. Wall Street had anticipated $5.246 billion — exceeding the company’s midpoint estimate.
Free cash flow projections came in 3% above Street consensus, with the company generating $1.54 billion in levered free cash flow over the trailing twelve months.
Benchmark analyst Mark Zgutowicz observed that management failed to quantify the financial impact of the new go-to-market initiative on the Applications & Commerce division. He anticipates continued pressure on bookings in the near term due to the transition toward shorter contract durations and reduced initial purchase sizes stemming from discount pricing.
He further predicted the bookings-revenue differential should contract throughout 2026, reaching near-equilibrium by year-end as transaction volume increases.
Wall Street Slashes Targets
The analyst community responded decisively. RBC Capital dramatically reduced its price target from $200 to $100, pointing to disappointing bookings and implementing what the firm described as a “more realistic AI-discounted multiple.” The firm retained its current rating.
JPMorgan lowered its target from $200 to $167 while preserving an Overweight rating. Analyst Alexei Gogolev noted the company is fast-tracking its AI transformation while navigating near-term go-to-market challenges.
UBS reduced its target to $105, Cantor Fitzgerald to $90, and Barclays to $118 — all while keeping Neutral or Overweight ratings intact.
The AI consideration carries significant weight. Analysts have highlighted concerns that GoDaddy may be trailing competitors like Wix.com and Squarespace in deploying AI capabilities. RBC indicated the results would strengthen bearish perspectives on AI’s disruptive impact on conventional web design platforms.
Cantor Fitzgerald previously suggested GoDaddy consider a take-private transaction to avoid public market scrutiny.
GDDY currently trades near its 52-week low of $86.78, down approximately 47% over the past twelve months.
