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What changed in GoDaddy's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of GoDaddy's 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+659 added−805 removedSource: 10-K (2025-02-20) vs 10-K (2024-02-29)

Top changes in GoDaddy's 2024 10-K

659 paragraphs added · 805 removed · 481 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

144 edited+45 added−32 removed68 unchanged
Biggest changeIn 2023, we launched and upgraded the following commerce products and services: • Payable Domains: Released Payable Domains, branded pay links that create a secure checkout page, shareable via a link, that allow anyone to begin accepting payments the moment they purchase a new U.S.-based domain name, even if they do not yet have a website or online store. 16 Table of Contents • GoDaddy Payments Canada: Launched our first international market for GoDaddy Payments with the expansion into the Canadian market, offering Canadian merchants the same low-cost payment processing and payment acceptance solutions our U.S. merchants enjoy. • Tap to Pay on GoDaddy App: Launched Tap-to-Pay capability in the GoDaddy Mobile App, lowering the barrier for millions of small businesses to start accepting in-person, contactless payments with only an iPhone or Android phone in a seamless, low-friction sign-up experience. • Microsoft Teams Integration: Partnered with Microsoft to introduce payment acceptance capabilities for businesses within the Microsoft Teams meeting platform. • Other AI Tools and Resources: Released GoDaddy.AI, a free online resource for customers, which provides tips and current news on all things generative AI for small businesses, as well as the Small Business Generative AI Prompt Library, a growing catalog of ready-made prompts for small businesses to have the tools to start benefiting from generative AI.
Biggest changeIn 2024, we launched and upgraded the following commerce products and services: • GoDaddy Payments Canada: Launched our first international market for GoDaddy Payments with the expansion into the Canadian market, offering Canadian merchants the lowest pricing compared to leading Canadian providers, and similar processing and payment acceptance solutions our U.S. merchants enjoy. • Tap to Pay on GoDaddy App: Launched Tap-to-Pay capability in the GoDaddy Mobile App for Android phones, lowering the barrier for millions of small businesses to start accepting in-person, contactless payments in a seamless, low-friction sign-up experience. • Smart Terminal Flex : Launched the new GoDaddy Smart Terminal Flex, a powerful and compact POS device in the GoDaddy Smart Terminal line that is powered by GoDaddy Payments. • GoDaddy Payments' Subscription Plans : Launched two new subscription plans for GoDaddy Payments customers that combine lower transaction fees with advanced commerce features like customized invoices and Pay Links, online ordering, inventory management capabilities, and access to GoDaddy Payments' credit card surcharge program and rate saver.
We offer a variety of plans, with pricing based on various features. Our Managed WordPress sites are built with enhanced security, automatic, regular backups and core updates, integrated Secure Sockets Layer (SSL), one-click migration tools, pre-installed extensions, plugins and themes, business email and backups and a staging site.
We offer a variety of plans, with pricing based on various features. Our Managed WordPress sites are built with automatic, regular backups and core updates, enhanced security, integrated Secure Sockets Layer (SSL), one-click migration tools, pre-installed extensions, plugins and themes, business email and backups and a staging site.
We manage and report our business in the following two segments: • Applications and Commerce (A&C) , which primarily consists of sales of products containing proprietary software, notably our website building products, as well as our commerce products and third-party email and productivity solutions and sales of certain products when they are included in bundled offerings of our proprietary software products. • Core Platform (Core) , which primarily consists of sales of domain registrations and renewals, aftermarket domain sales, website hosting products and website security products when not included in bundled offerings of our proprietary software products as well as sales of products not containing a software component.
We manage and report our business in the following two segments: • Applications and Commerce (A&C) , which primarily consists of sales of products containing proprietary software, notably our website building products, as well as our proprietary commerce solutions and third-party email and productivity solutions and sales of certain products when they are included in bundled offerings of our proprietary software products. • Core Platform (Core) , which primarily consists of sales of domain registrations and renewals, aftermarket domain sales, domain protection, website hosting products and website security products when not included in bundled offerings of our proprietary software products as well as sales of products not containing a software component.
In addition, the Smart Terminal seamlessly integrates with both our Websites + Marketing Online Store and Managed WooCommerce Stores to unify in-person and online sales so businesses can offer “Buy online pick up in-store” experiences to their customers. The Smart Terminal also offers access to third-party applications that meet merchants' needs that we do not address directly.
In addition, the Smart Terminal line seamlessly integrates with both our Websites + Marketing Online Store and Managed WooCommerce Stores to unify in-person and online sales so businesses can offer “Buy online pick up in-store” experiences to their customers. The Smart Terminal line also offers access to third-party applications that meet merchants' needs that we do not address directly.
Laws and regulations relating to our activities are unsettled in many jurisdictions and may prove difficult or impossible to comply with in some jurisdictions. Additionally, federal, state, local and foreign governments are also considering legislative and regulatory proposals that would regulate the Internet and our activities in more and different ways than exist today.
Laws, rules and regulations relating to our activities are unsettled in many jurisdictions and may prove difficult or impossible to comply with in some jurisdictions. Additionally, federal, state, local and foreign governments are also considering legislative and regulatory proposals that would regulate the Internet and our activities in more and different ways than exist today.
We currently offer several tiers of website hosting plans to suit the needs and resources of our customers, a majority of which use industry standard cPanel or Parallels Plesk control panels. We also bundle our hosting plans with a variety of applications and products such as web analytics, SSL certificates and WordPress.
We currently offer several tiers of website hosting plans to suit the needs and resources of our customers, a majority of which use industry standard cPanel or Parallels Plesk control panels. We also bundle our hosting plans with a variety of applications and products such as web analytics and SSL certificates.
Regulations relating to the Internet, including laws governing online content, user privacy and data protection, automatic renewal laws, taxation, and liability for third-party activities, are particularly relevant to our business. A sample of such laws and regulations is discussed below. Communications Decency Act (CDA) .
Regulations relating to the Internet, including laws governing online content, user privacy and data protection, automatic renewal laws, taxation, and liability for third-party activities, are particularly relevant to our business. A sample of such laws, rules and regulations is discussed below. Communications Decency Act (CDA) .
Advertising and promotional information presented on our websites and in our products, and our other marketing and promotional activities, are subject to federal and state consumer protection laws regulating unfair and deceptive practices. U.S. federal, state and foreign legislatures have also adopted laws and regulations regulating numerous other aspects of our business.
Advertising and promotional information presented on our websites and in our products, and our other marketing and promotional activities, are subject to federal and state consumer protection laws regulating unfair and deceptive practices. U.S. federal, state and foreign legislatures have also adopted laws, rules and regulations regulating numerous other aspects of our business.
Laws and regulations in the U.S. or in foreign jurisdictions may be applied in new or different manners in pending or future litigation. Further, other existing bodies of law, including the criminal laws of various jurisdictions, may be deemed to apply to our activities, or new statutes or regulations may be adopted in the future.
Laws, rules and regulations in the U.S. or in foreign jurisdictions may be applied in new or different manners in pending or future litigation. Further, other existing bodies of law, including the criminal laws of various jurisdictions, may be deemed to apply to our activities, or new statutes or regulations may be adopted in the future.
The CCPA and its associated regulations require covered companies to provide new disclosures to California consumers and afford such consumers new abilities to opt-out of certain sales and sharing of personal information for advertising and other purposes.
The CCPA and its associated regulations require covered companies to provide specific disclosures to California consumers and afford such consumers new abilities to opt-out of certain sales and sharing of personal information for advertising and other purposes.
Surrounding these channels and tactics, our customers also need easy-to-use tools to run their businesses. • Technology that is easy-to-use, reliable, secure, performance enhancing and evolves with their needs.
Surrounding these channels and tactics, our customers also need easy-to-use tools to run their businesses. • Technology that is easy-to-use, reliable, secure, efficient, performance enhancing and evolves with their needs.
We invested in the automation of common physical data center components like servers, load balancers, switches and storage, and we use open source solutions when possible to automate manual processes and thereby reduce the risk of human error and lower costs. Additionally, we leverage a common automated infrastructure based on OpenStack and Kernel-based Virtual Machine (KVM) to enable next-generation services.
We invest in the automation of common physical data center components like servers, load balancers, switches and storage, and we use open source solutions when possible to automate manual processes and thereby reduce the risk of human error and lower costs. Additionally, we leverage a common automated infrastructure based on OpenStack and Kernel-based Virtual Machine (KVM) to enable next-generation services.
We consider the following to be a representative list of competitors we face in some of the major areas we operate in: • With respect to our Core Platform products and services: Newfold Digital, Namecheap, Tucows, Dynadot, GMO, Cloudflare, Let's Encrypt, SEDO, Comodo, Hostinger and Identity Digital; 17 Table of Contents • With respect to our A&C products and services: Shopify, Block, BigCommerce, Stripe, PayPal, Liquid Web, SiteGround, WP Engine, Zoho, Mindbody, Toast, Yelp, OpenTable, TikTok, Meta and WeChat; and • With respect to both our Core Platform and A&C products and services: Wix, Squarespace, Automattic, Ionos, Google, Amazon, Microsoft, Alibaba and Tencent.
We consider the following to be a representative list of competitors we face in some of the major areas we operate in: • With respect to our Core Platform products and services: Newfold Digital, Namecheap, Tucows, Dynadot, GMO, Cloudflare, Let's Encrypt, SEDO, Comodo, Hostinger and Identity Digital; • With respect to our A&C products and services: Shopify, Block, BigCommerce, Stripe, PayPal, Liquid Web, SiteGround, WP Engine, Zoho, Mindbody, Toast, Yelp, OpenTable, TikTok, Meta and WeChat; and • With respect to both our Core Platform and A&C products and services: Wix, Squarespace, Automattic, Ionos, Google, Amazon, Microsoft, Alibaba and Tencent.
Various U.S. federal, state and international laws and regulations govern the payments industry, including the Bank Secrecy Act of 1970 and state money transmitter licensing laws.
Various U.S. federal, state and international laws, rules and regulations govern the payments industry, including the Bank Secrecy Act of 1970 and state money transmitter licensing laws.
Physical Infrastructure and Management Our physical technology infrastructure supports our products, experiences and business systems through servers located in data centers around the world. As a leading website hosting platform, we invested significantly in our peering architecture and underlying infrastructure management to handle significant Internet traffic at low bandwidth costs.
Physical Infrastructure and Management Our physical technology infrastructure supports our products, experiences and business systems through servers located in data centers around the world. As a leading website hosting platform, we invest significantly in our peering architecture and underlying infrastructure management to handle significant Internet traffic at low bandwidth costs.
The Stop Enabling Sex Traffickers Act (SESTA) and Allow States and Victims to Fight Online Sex Trafficking Act of 2017 (FOSTA), which became effective in April 2018, amend certain portions of the CDA, which may limit the immunity previously available to us under the CDA. Digital Millennium Copyright Act (DMCA) .
The Stop Enabling Sex Traffickers Act and Allow States and Victims to Fight Online Sex Trafficking Act of 2017, which became effective in April 2018, amend certain portions of the CDA, which may limit the immunity previously available to us under the CDA. Digital Millennium Copyright Act (DMCA) .
Our payments services may be or become subject to regulation by authorities, which would subject us to, among other things, (i) record-keeping, reporting and bonding requirements, (ii) limitations on the investment of customer funds and (iii) inspection by state and federal regulatory agencies.
Our payments services may become subject to regulation by authorities, which would subject us to, among other things, (i) record-keeping, reporting and bonding requirements, (ii) limitations on the investment of customer funds and (iii) inspection by state and federal regulatory agencies.
For customers wanting to protect their email data, we offer an email backup service, and for customers needing to comply with regulatory requirements, we offer email add-on services such as HIPAA-enabled email, encryption services (in partnership with ProofPoint), archiving services (in partnership with Barracuda) and advanced e-mail security.
For customers wanting to protect their email data, we provide an email backup service, and for customers needing to comply with regulatory requirements, we provide email add-on services such as HIPAA-enabled email, encryption services (in partnership with ProofPoint), archiving services (in partnership with Barracuda) and advanced e-mail security.
These various channels provide a diverse inventory available to meet the demand from our customers. Our GoDaddy Investor mobile application helps investors watch and bid on domains at auction and stay on top of their current bids from their mobile devices.
These various channels provide a diverse inventory available to meet the demand from our customers. In addition, our GoDaddy Investor mobile application helps investors watch and bid on domains at auction and stay on top of their current bids from their mobile devices.
Our Card Reader and Tap-to-Pay on the GoDaddy Mobile App (iPhone and Android) allow customers to take payments and sell on the go. Our Virtual Terminal allows customers to take payments from their smartphone, tablet or computer with Internet connection with no hardware needed.
Our Card Reader and Tap-to-Pay on the GoDaddy Mobile App (iPhone and Android) allow customers to accept payments and sell on the go. Our Virtual Terminal allows customers to accept payments from their smartphone, tablet or computer with Internet connection with no hardware needed.
We help our WebPros customers in a number of ways beyond our product suite and services, including providing tools to help them save time, make money and exceed client expectations. These client management applications make it easier for designers and developers to manage their clients' websites at any host, or on GoDaddy products such as Managed WordPress.
We help our WebPros customers in a number of ways beyond our product suite and services, including providing tools to help them save time, make money and exceed client expectations. These client management applications aim to make it easier for WebPros to manage their clients' websites at any host, or on GoDaddy products such as Managed WordPress.
Today, having an effective online presence often means having a combination of: (i) a secure and content-rich website viewable from any device; (ii) a presence on social media channels (e.g., Meta, TikTok, Snapchat, X (f/k/a Twitter) and WeChat); (iii) getting found by search engines (e.g., Google); and (iv) establishing a presence on: (a) an increasing number of horizontal marketplaces (e.g., Yelp and Eventbrite); (b) vertical marketplaces (e.g., Zillow, OpenTable and HomeAdvisor); and (c) e-commerce platforms (e.g., Amazon, eBay and Etsy). • Commerce .
Today, having an effective online presence often means having a combination of: (i) a secure and content-rich website viewable from any device; (ii) a presence on multiple social media channels (e.g., Meta, TikTok, Snapchat, X and WeChat); (iii) getting found by search engines (e.g., Google); and (iv) establishing a presence on: (a) an increasing number of horizontal marketplaces (e.g., Yelp and Eventbrite); (b) vertical marketplaces (e.g., Zillow, OpenTable and HomeAdvisor); and (c) e-commerce platforms (e.g., Amazon, eBay and Etsy). • Commerce .
We also provide a link to the section of the SEC's website at www.sec.gov that has all of the reports, proxy and information statements we file or furnish with the SEC. 20 Table of Contents
We also provide a link to the section of the SEC's website at www.sec.gov that has all of the reports, proxy and information statements we file or furnish with the SEC. 21 Table of Contents
Though we rely in part upon these legal and contractual protections, as well as various procedural safeguards, we believe the skill and ingenuity of our employees, the functionality and 19 Table of Contents frequent enhancements to our solutions and our ability to introduce new products and features meeting the needs of our customers are more important to maintaining our competitive position in the marketplace.
Though we rely in part upon these legal and contractual protections, as well as various procedural safeguards, we believe the skill and ingenuity of our employees, the functionality and frequent enhancements to our solutions and our ability to introduce new products and features meeting the needs of our customers are more important to maintaining our competitive position in the marketplace.
Our content platform and content creation processes help us realize efficiencies and scalability, which enhance our ability to drive new, high-quality products and customer experiences to market faster. We focus on driving advancements in experimentation, the speed and volume of content creation, localization and content self-service, while ensuring platform availability and performance.
Our content platform and content creation processes help us realize efficiencies and scalability, which 16 Table of Contents enhance our ability to drive new, high-quality products and customer experiences to market faster. We focus on driving advancements in experimentation, the speed and volume of content creation, localization and content self-service, while ensuring platform availability and performance.
The ACPA provides that registrars may not be held liable for damages for registration or maintenance of a domain name for another person absent a showing of the registrar's bad faith intent to profit. Registrars may, however, be held liable if their activities are deemed outside the scope of basic registrar functions. 18 Table of Contents Lanham Act .
The ACPA provides that registrars may not be held liable for damages for registration or maintenance of a domain name for another person absent a showing of the registrar's bad faith intent to profit. Registrars may, however, be held liable if their activities are deemed outside the scope of basic registrar functions. Lanham Act .
Certain of our employees in Germany are represented by employee works councils and some other internationally based employees are represented by worker representatives in accordance with local regulations. At GoDaddy, we strive for a workplace culture where everyone has the opportunity to thrive.
Certain of our employees in Germany are represented by employee works councils and some other internationally based employees are represented by worker representatives in accordance with local regulations. 14 Table of Contents At GoDaddy, we strive for a workplace culture where everyone has the opportunity to thrive.
These investors bring a unique and valuable resource to our business in the form of liquidity and the ability to help our other populations (Independents and WebPros) successfully find a domain name they prefer. We also serve Third Party Registrars and Corporate Domain Portfolio owners.
These investors bring a unique and valuable resource to our business in the form of liquidity and the ability to help our other populations (Independents and WebPros) successfully find a domain name they prefer. 6 Table of Contents We also serve Domain Registrars, Third Party Registrars and Corporate Domain Portfolio owners.
This service enables our customers to start accepting payments in minutes with a simple setup and get paid, in many cases, as early as the next business day, all with the lowest fees in the industry when compared to other leading providers.
This service enables our customers to start accepting payments in minutes with a simple setup and get paid, in many cases, as early as the next business day, all with the lowest fees in the industry when compared to similar plans from other leading providers.
In addition, California enacted the California Consumer Privacy Act (CCPA) in 2018, effective January 1, 2020, which was further modified by the passage of the California Privacy Rights Act (CPRA).
In addition, California enacted the California Consumer Privacy Act in 2018, effective January 1, 2020, which was further modified by the passage of the California Privacy Rights Act (CPRA, and collectively, CCPA).
We market and sell to customers in over 200 markets around the world and in 2023, 48% of our customer base and approximately a third of our revenue was derived from our international presence. Seamlessly Intuitive Experiences. Our customers often self-identify as non-technical and inexperienced in areas such as marketing, content creation and customer management.
We market and sell to customers in over 200 markets around the world and in 2024, 49% of our customer base and approximately a third of our revenue was derived from our international presence. Seamlessly Intuitive Experiences. Our customers often self-identify as non-technical and inexperienced in areas such as marketing, content creation and customer management.
We serve third party registrars through GoDaddy Registry which provides wholesale generic top level domains (gTLDs) and country-code top-level domains (ccTLDs) for registrars to sell to the end customer. These top-level domains (TLDs) provide alternatives to the .com domain that more closely represent the names of our customers' ideas, businesses and brands.
Third party registrars are served through GoDaddy Registry which provides wholesale generic top-level domains (gTLDs) and country-code top-level domains (ccTLDs) for registrars to sell to the end customer. These top-level domains (TLDs) provide alternatives to the .com domain that more closely represent the names of our customers' ideas, businesses and brands.
Depending on their journey, a customer may seek guidance on setting up a website, launching new features or trying a new product or service and they need that guidance on their time. Our customers need real people who are readily available and can provide care to customers who have different levels of technical sophistication.
Depending on their journey, a customer may seek guidance on setting up a website, launching new features or trying a new product or service and they need that guidance on their time. Our customers need real people who are readily available and can provide care to customers at all levels of technical sophistication.
We rely on a combination of trademark, patent, copyright and trade secret laws, confidentiality and access-related procedures and safeguards and contractual provisions to protect our proprietary technologies, confidential information, brands and other intellectual property. As of December 31, 2023, we had 368 issued patents in the U.S. and other countries covering various aspects of our product offerings.
We rely on a combination of trademark, patent, copyright and trade secret laws, confidentiality and access-related procedures and safeguards and contractual provisions to protect our proprietary technologies, confidential information, brands and other intellectual property. 20 Table of Contents As of December 31, 2024, we had 368 issued patents in the U.S. and other countries covering various aspects of our product offerings.
Several other U.S. states recently have adopted or are considering laws and regulations relating to processing of personal information that apply to our business. We expect compliance with the increasing number of these laws and regulations to be more burdensome and costly for us. Payments Regulation .
Numerous other U.S. states have adopted or are considering laws, rules and regulations relating to processing of personal information that apply to our business. We expect compliance with the increasing number of these laws, rules and regulations to be more burdensome and costly for us. Payments Regulation .
As of December 31, 2023, approximately 92% of our customers purchased a domain from us. In addition, GoDaddy Registry provides a high-performance back-end registry technology platform with a portfolio of TLDs including .biz, .co, .nyc, and .us. Our primary domains product offerings include: Primary Registrations .
As of December 31, 2024, approximately 93% of our customers purchased a domain from us. In addition, GoDaddy Registry provides a high-performance back-end registry technology platform with a portfolio of TLDs including .biz, .co, .nyc, and .us. Our primary domains product offerings include: Primary Registrations .
As part of the GoDaddy Commerce ecosystem, Managed WooCommerce Stores, our WordPress-based online store solutions, provide our customers everything they need to sell online, in person, and across popular marketplaces and social media platforms from one built-in experience.
As part of the GoDaddy Commerce ecosystem, Managed 8 Table of Contents WooCommerce Stores, our WordPress-based online store solutions, provide our customers with everything they need to sell online, in person, and across popular marketplaces and social media platforms from one built-in experience.
We design these solutions to be easy to use, effective, reliable, flexible and provide great value. We offer a variety of hosting and security products enabling our customers to create and manage their identity, or in the case of WebPros, the identities of their end-customers.
We design these solutions to be easy to use, effective, reliable, flexible and provide great value. We offer a variety of hosting and security products enabling our customers to create and manage their identity, or in the case of WebPros, the identities of their end-customers. Our primary hosting and security products include: Shared Website Hosting .
The ACPA was enacted to address piracy on the Internet by curtailing a practice known as "cybersquatting," or the bad-faith registration of a domain name identical or similar to another party's trademark, or to the name of another living person, in order to profit from that name or mark.
Anti-Cybersquatting Consumer Protection Act (ACPA) . The ACPA was enacted to address piracy on the Internet by curtailing a practice known as "cybersquatting," or the bad-faith registration of a domain name identical or similar to another party's trademark, or to the name of another living person, in order to profit from that name or mark.
Our primary registration offering relies heavily on our search, discovery and recommendation tools which enable our customers to find a domain name that matches their business needs and goals. We also sell domain registrations through relationships with third-party resellers and we provide back-end registry services supporting more than 200 TLDs. Aftermarket .
Our primary registration offering relies heavily on our search, discovery and recommendation tools which enable our customers to find a domain name that matches their business needs and goals. We also sell domain registrations through relationships with third-party resellers and we provide back-end registry services supporting approximately 180 TLDs. Aftermarket .
This service combines dedicated teams of branding experts – photographers, writers, designers, marketers – with proprietary technology to manage activity on Meta, X (f/k/a Twitter) and Yelp, among others, to help our customers acquire new customers and build stronger relationships with their existing customers.
This service combines dedicated teams of branding experts – photographers, writers, designers, marketers – with proprietary technology to manage activity on Meta, X and Yelp, among others, to help our customers acquire new customers and build stronger relationships with their existing customers.
Our mission is to empower entrepreneurs everywhere, making opportunity more inclusive for all. We are passionate about our mission and honored that entrepreneurs trust their ideas with us. Our 21.0 million customers are passionate and determined to transform their ideas into something meaningful.
Our mission is to empower entrepreneurs everywhere, making opportunity more inclusive for all. We are passionate about our mission and honored that entrepreneurs trust their ideas with us. Our 20.5 million customers are passionate and determined to transform their ideas into something meaningful.
Item 1. Business Overview GoDaddy is a global leader serving a large market of entrepreneurs, developing and delivering easy-to-use products in a one-stop shop solution alongside personalized guidance. We serve small businesses, individuals, organizations, developers, designers and domain investors. Our vision is to radically shift the global economy toward life-fulfilling entrepreneurial ventures.
Item 1. Business Overview GoDaddy is a global leader serving a large market of entrepreneurs, developing and delivering easy-to-use solutions as a one-stop shop provider, alongside personalized guidance. We serve small businesses, individuals, organizations, developers, designers and domain investors. Our vision is to radically shift the global economy toward life-fulfilling entrepreneurial ventures.
We invest in the architecture and capabilities of our e-commerce platform to create an ecosystem where we can rapidly scale up or down and integrate with third-party offerings. The platform broadens our distribution channels by being extensible and allowing resellers to easily sell our products.
Our investments in our platform capabilities include the following: E-commerce Platform and Application Services. We invest in the architecture and capabilities of our e-commerce platform to create an ecosystem where we can rapidly scale up or down and integrate with third-party offerings. The platform broadens our distribution channels by being extensible and allowing resellers to easily sell our products.
Technology and Infrastructure Our products, customer experiences and business systems are enabled by our technology and infrastructure to provide scalability, security and flexibility. Technology and development expenses, including those expenses related to our technology platform, were $840 million, $794 million and $706 million in 2023, 2022 and 2021, respectively.
Technology and Infrastructure Our products, customer experiences and business systems are enabled by our technology and infrastructure to provide scalability, security and flexibility. Technology and development expenses, including those expenses related to our technology platform, were $814 million, $840 million and $794 million in 2024, 2023 and 2022, respectively.
With Managed WordPress, we reduced the complexity of launching and managing WordPress sites so our customers can stay focused on growing their business, not managing complex WordPress hosting tasks. We provide this on a fully managed platform that delivers fast performance and AI-powered site creation.
For example, with Managed WordPress, we help reduce the complexity of launching and managing WordPress sites so our customers can stay focused on growing their business, not managing complex WordPress hosting tasks. We provide this on a fully managed platform that delivers fast performance and AI-powered site creation.
Our customers also have the ability to take online payments without needing to create a website through our Online Pay Links. Customers can brand and personalize these shareable pay links with their domain, giving them another 8 Table of Contents opportunity to build their brand. Pay links can be sent through text or email or shared on social media sites.
Our customers also have the ability to accept online payments without needing to create a website through our Online Pay Links. Customers can brand and personalize these shareable pay links with their domain, giving them another opportunity to build their brand. Pay links can be sent through text or email or shared on social media sites.
We support this goal by focusing on key human capital initiatives including: 13 Table of Contents • Pay Parity. We actively work to attract a diverse employee population and are committed to providing equitable opportunity in all aspects of employment.
We support this goal by focusing on key human capital initiatives including: • Compensation, Pay Parity and Benefits. We actively work to attract a diverse employee population and are committed to providing equitable opportunity in all aspects of employment.
These microbusinesses have an entrepreneurial spirit, strong work ethic and, above all, passion for their ideas, yet their specific needs vary depending on the type of their idea and the phase of their journey.
Microbusiness owners have an entrepreneurial spirit, strong work ethic and, above all, passion for their ideas, yet their specific needs vary depending on the type of their idea and the phase of their journey.
We design our websites and tools to work seamlessly on mobile devices, with a focus on performance, to enable websites to appear in search engine rankings. 7 Table of Contents Managed WordPress and Managed WooCommerce Stores.
We design our websites and tools to work seamlessly on mobile devices, with a focus on performance, to enable websites to appear in search engine rankings. Managed WordPress and Managed WooCommerce Stores.
In addition, GoDaddy partners with various third-party providers and vendors to provide contracted care and support services to our customers; approximately 3,500 individuals are employed with or engaged by our external partners while dedicated to GoDaddy as GoDaddy Guides. These third-party providers are primarily located in international markets, most significantly in India, the Philippines, and Malaysia.
In addition, GoDaddy partners with various third-party providers and vendors to provide contracted care and support services to our customers; approximately 3,700 individuals are employed with or engaged by our external partners. These third-party providers are primarily located in international markets, most significantly in India, the Philippines, and Malaysia.
Similar to our Websites + Marketing product, Managed WooCommerce Stores include our centralized dashboard, allow for marketplace selling and are integrated with GoDaddy Payments and our Smart Terminal POS system. Point-of-Sale (POS) Systems. We offer a countertop Smart Terminal for businesses with in-store operations.
Similar to our Websites + Marketing product, Managed WooCommerce Stores include our centralized dashboard, allow for marketplace selling and are integrated with GoDaddy Payments and our Smart Terminal POS system. Point-of-Sale (POS) Systems. We offer a line of smart POS terminals for businesses with in-store operations, including our flagship countertop, Smart Terminal, and our compact Smart Terminal Flex.
These types of products and solutions continue to evolve, creating opportunity for new competitors to enter the market with point-solution products or address specific segments of the market. In some instances, we use commercial partnerships with companies with which we also compete.
The market for our products and services is highly fragmented and competitive. These types of products and solutions continue to evolve, creating opportunity for new competitors to enter the market with point-solution products or address specific segments of the market. In some instances, we use commercial partnerships with companies with which we also compete.
We help make Microsoft 365 installation easy, allowing customers to be up and running in minutes, including "do-it-for-me" migration services to move customers' existing email data to Microsoft 365 accounts. In 2023, 2022 and 2021, we derived approximately 34%, 31% and 30% of our total revenue, respectively, from sales of our A&C products.
We help make Microsoft 365 and Microsoft 365 Copilot installation easy, allowing customers to be up and running in minutes, including "do-it-for-me" migration services to move customers' existing email data to Microsoft 365 accounts. 9 Table of Contents In 2024, 2023 and 2022, we derived approximately 36%, 34% and 31% of our total revenue, respectively, from sales of our A&C products.
While these customer populations tend to utilize many of the same GoDaddy product offerings, there are meaningful differences in their journeys, what they value, their goals and how they communicate with the rest of the world. We aim to establish and provide solutions that address these differences. Our largest customer population, Independents, consists mostly of microbusinesses and noncommercial endeavors.
While these customer populations tend to utilize many of the same GoDaddy product offerings, there are meaningful differences in their journeys, what they value, their goals and how they communicate with their current and potential customers. We aim to establish and provide solutions that address these differences. Our largest customer population, Independents, consists mostly of microbusinesses and non-commercial endeavors.
Our security product portfolio is a comprehensive suite of tools designed to help secure our customers' online presence.
Our security product portfolio is a comprehensive suite of tools designed to help our customers secure their online presence.
Our customers need to effectively communicate with existing customers and potential customers across a communication landscape that is fragmented in both form and 11 Table of Contents function.
Our customers need to effectively communicate with existing customers and potential customers across a communication landscape that is fragmented in both form and function.
In addition, registrars and website hosting providers must expeditiously remove or disable access to content upon receiving a proper notice from a copyright owner alleging infringement of its protected works. A registrar or website hosting provider failing to comply with these safe harbor requirements may be found liable for copyright infringement. Anti-Cybersquatting Consumer Protection Act (ACPA) .
In addition, registrars and website hosting providers must expeditiously remove or disable access to content upon receiving a proper 19 Table of Contents notice from a copyright owner alleging infringement of its protected works. A registrar or website hosting provider failing to comply with these safe harbor requirements may be found liable for copyright infringement.
We live by the same principles that enable our customers' ideas to survive and thrive, including owning outcomes, building value, joining forces, working courageously and living passionately. We take responsibility for delivering successful outcomes based on data driven decisions, which we believe is a key factor driving our customer and revenue growth.
We live by the same principles that enable our customers' ideas to survive and thrive, including owning outcomes, building value, joining forces, working courageously and living passionately. We take pride in delivering successful outcomes based on data-driven decisions, which we believe is a key factor driving our financial performance.
As of December 31, 2023, we had approximately 10.2 million customers outside of the U.S. and derived approximately 33%, 32% and 32% of our total bookings from international sales in 2023, 2022 and 2021, respectively.
As of December 31, 2024, we had approximately 10.0 million customers outside of the U.S. and derived approximately 32%, 32% and 33% of our total revenue from international sales in 2024, 2023 and 2022, respectively.
We also provide a fully managed registry platform for other registry operators. We manage the full technology and operating stack at scale for over 200 TLDs including some of the largest brands in the world. Corporate Domain Portfolio owners are organizations that maintain and manage a large portfolio of domain names, including general and international domains.
For registry operators, we provide a fully managed registry platform, including managing the full registry technology and operating stack at scale, with approximately 180 TLDs including some of the largest brands in the world. We also serve corporate domain portfolio owners, which are organizations that maintain and manage a large portfolio of domain names, including general and international domains.
We are a global leader in domain name registration, with approximately 85 million domains under management as of December 31, 2023. Based on information reported in VeriSign's most recent Domain Name Industry Brief, this represented approximately 24% of the approximately 360 million domain names registered worldwide as of December 31, 2023.
We are a global leader in domain name registration, with approximately 81 million domains under management as of December 31, 2024. Based on information reported in VeriSign's most recent Domain Name Industry Brief, this represented approximately 22% of the approximately 362 million domain names registered worldwide as of December 31, 2024.
With our products and services, WebPros can easily manage their overall business with capabilities such as client billing, administrative access and shopping features, making it easier for them to buy and manage multiple products for their clients, as well as make use of enhanced technical support and discounts for reselling GoDaddy products.
Our solutions are built to assist WebPros in more easily managing their overall business with capabilities such as client billing, administrative access and shopping features, making it easier for them to buy and manage multiple products for their clients, as well as make use of enhanced technical support and discounts for reselling GoDaddy products.
We operate a large domain aftermarket platform, which processes aftermarket, or secondary, domain name sales. We designed our aftermarket platform to enable the seamless purchase and sale of previously registered domain names through an online auction, an offer and counter offer transaction or a "buy now" transaction and automation and lease to own options for our customers.
We designed our aftermarket platform to enable the seamless purchase and sale of previously registered domain names through an online auction, an offer and counter offer transaction, a "buy now" transaction and automation and lease to own options for our customers.
As of December 31, 2023, we had 2,259 employees in technology 14 Table of Contents and development and 368 issued patents in the U.S. and other countries covering various aspects of our product offerings. Additionally, as of December 31, 2023, we had 12 pending U.S. and international patent applications and intend to file additional patent applications in the future.
As of December 31, 2024, we had 2,247 employees in technology and development and 368 issued patents in the U.S. and other countries covering various aspects of our product offerings. Additionally, as of December 31, 2024, we had 11 pending U.S. and international patent applications and intend to file additional patent applications in the future.
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and our Proxy Statements are available through our investor relations website, free of charge, as soon as reasonably practicable after we file them with the SEC.
Our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and our Proxy Statements (including any amendments thereto) are available through our investor relations website, free of charge, as soon as reasonably practicable after we file such reports with the SEC.
Our primary website building products (Websites + Marketing, Managed WordPress and GoDaddy Airo), website security suite, email offerings (Microsoft 365), commerce products and domain aftermarket each represent significant need states that are complementary to our long-standing offerings and benefit from our strengths as a company in human-infused technology.
Our primary website building products (Websites + Marketing, Managed WordPress), website security suite, email offerings (Microsoft 365), commerce products and domain aftermarket each represent significant need states that are complementary to our long-standing offerings and benefit from our strengths as a company in human-infused technology. Our key product development initiatives include: Powering a Simple and Effortless Presence .
Additionally, as of December 31, 2023, we had 12 pending U.S. and international patent applications and intend to file additional patent applications in the future. As of December 31, 2023, we had 583 registered and 25 pending trademarks in jurisdictions including the U.S., E.U., UK, China and Germany.
Additionally, as of December 31, 2024, we had 11 pending U.S. and international patent applications and intend to file additional patent applications in the future. As of December 31, 2024, we had 588 registered and 55 pending trademarks in jurisdictions including the U.S., E.U., UK, China and Germany.
As of December 31, 2023, 446 different generic TLDs, such as .com, .net and .biz, and 58 different country code TLDs, 9 Table of Contents such as .co, .ca, .in and .jp., were available for purchase through GoDaddy.
As of December 31, 2024, 458 different generic TLDs, such as .com, .net and .biz, and 58 different country code TLDs, such as .co, .ca, .in and .jp., were available for purchase through GoDaddy.
We continue to invest in Websites + Marketing and other tools, templates and technology to make building, maintaining and updating a professional looking mobile or desktop presence simple and easy. In 2023, we launched GoDaddy Airo in the U.S.
We continue to invest in Websites + Marketing and other tools, templates and technology to make building, maintaining and updating a professional looking mobile or desktop presence simple and easy.
In addition to our Smart Terminal, we offer other payment acceptance solutions that allow our customers to take payments their way while seamlessly interacting with their customers wherever they may be. For example, we now include Payable Domains, a default payments system that creates a frictionless, out-of-the-box experience for our customers.
In addition to our Smart Terminal line of POS systems, we offer payment acceptance solutions that allow our customers to accept payments their way while seamlessly interacting with their customers wherever they may be. For example, we include Payable Domains, a default payments system that is designed to create a frictionless, out-of-the-box experience for our customers.
Corporate Information We were incorporated in Delaware on May 28, 2014. Our principal executive offices are located at 2155 E. GoDaddy Way, Tempe, Arizona 85284, and our telephone number is (480) 505-8800. Available Information Our website is located at www.godaddy.com and our investor relations website is located at investors.godaddy.net.
Corporate Information We were incorporated in Delaware on May 28, 2014. Our principal executive offices are located at 100 S. Mill Ave, Suite 1600, Tempe, Arizona 85281, and our telephone number is (480) 505-8800. Available Information Our website is located at www.godaddy.com and our investor relations website is located at investors.godaddy.net.
With Websites + Marketing, our 12 Table of Contents own captive CMS, we incorporate seamlessly intuitive experiences by uniting marketing, content, commerce and customer management tools into a single experience.
With Websites + Marketing, our proprietary CMS, we incorporate seamlessly intuitive experiences by uniting marketing, content, commerce and customer management tools into a single experience.
Email marketing lets customers build targeted campaigns, either from scratch or using website or commerce content. Social Media Marketing helps customers create ads and boost brand awareness through a complete "do-it-for-me" service for managing engagement on the most popular social networks.
Business listings capabilities bring business information to where customers are looking, including Meta and Google My Business. Email marketing lets customers build targeted campaigns, either from scratch or using website or commerce content. Social Media Marketing helps customers create ads and boost brand awareness through a complete "do-it-for-me" service for managing engagement on the most popular social networks.
The portfolio includes (i) public key infrastructure (PKI) and SSL certificates to help ensure information is secure between browsers and servers through encryption; (ii) the use of a content delivery network (CDN) to improve a website's performance; (iii) a proprietary web application firewall (WAF) to help keep customers' websites safe from hackers; (iv) continuous malware scanning and site cleanups; and (v) a skilled team of security professionals to provide incident responses in the event of a disruption in service.
The portfolio includes (i) SSL certificates to help ensure information is secure between browsers and servers through encryption; (ii) the use of a content delivery network to improve a website's performance; (iii) a proprietary web application firewall to help keep customers' websites safe from hackers; (iv) managed security with malware scanning and site cleanups; and (v) a skilled team of security professionals working to secure our services or to provide support in the event of a disruption to our solutions.
Our primary commerce products and services include: Online Store. Our Websites + Marketing product includes online store capabilities, which allows our customers to transact business directly on their websites.
Our Websites + Marketing product includes online store capabilities, which allows our customers to transact business directly on their websites.
Since 2015, we published an annual diversity and pay parity report and, according to our analysis, we believe we paid men and women substantially the same for performing similar jobs across the company for all entities included in the analysis.
Since 2015, we have published an annual diversity and pay parity report and, according to our analysis, we continue to compensate our male and female employees substantially the same for performing similar jobs across the company for all entities included in our analysis.
We built a dedicated team responsible for ensuring scaling and, when necessary, the localization of our core product offerings as well as our customer care and marketing efforts. We have continued to expand our international employee presence and continue to expand our marketing efforts internationally.
We built a dedicated team responsible for ensuring scaling and, when necessary, the localization of our core product offerings as well as our customer care and marketing efforts.
Our customers deeply value expertise and know-how, which has been part of the GoDaddy DNA through our GoDaddy Guides since our founding. Our customers' needs are highly individualized and unique to their ventures, which we believe makes operating a guidance experience – at scale – a competitive advantage.
Our customers deeply value expertise and know-how, which has been part of the GoDaddy DNA since our founding. Our customers' needs are highly individualized and unique to their ventures, which we believe makes operating a guidance experience – at scale – a competitive advantage. In recent years, we extended this competency into several new interfaces and subject matters.
During the five years ended December 31, 2023, we invested to support our growth with $3,393 million in technology and development expenses. The growth in our technology and development expenses has been driven primarily by our focus on enhancing customer experiences through the use of software-driven products. Additionally, we offer Domain Registry and Corporate Domains solutions to our customers.
The growth in our technology and development expenses has been driven primarily by our focus on enhancing customer experiences through the use of software-driven products. Additionally, we offer Domain Registry and Corporate Domains solutions to our customers.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we do not effectively manage future growth, our operating results will be adversely affected. • We may acquire other businesses or talent, which could require significant management attention, disrupt our business, dilute stockholder value and adversely affect our operating results. • We may enter into new lines of business that offer new products and services, which may subject us to additional risks. • We are exposed to the risk of system failures and capacity constraints. • We rely on third parties to perform certain key functions, and their failure to perform those functions could result in the interruption of our operations and systems and could result in significant costs and reputational damage to us. • A network attack, a security breach or other cybersecurity incident could delay or interrupt service to our customers, harm our reputation, cause us to incur substantial costs, or subject us to significant liability. • If the security of the confidential information or personal information we or our vendors or partners maintain, including that of our customers and the visitors to our customers’ websites stored in our systems, is breached or otherwise subjected to unauthorized access, our reputation may be harmed, we may be required to expend substantial resources to mitigate and remediate such breach, and we may be exposed to substantial liability. • We maintain an enterprise-wide cybersecurity program.
Biggest changeIf we do not effectively manage future growth, our operating results will be adversely affected. • Acquisitions and other strategic transactions, including investments or entries into new businesses, joint ventures, divestitures or other transactions, could require significant management attention, disrupt our business, dilute stockholder value and adversely affect our operating results. • We are exposed to the risk of system failures and capacity constraints. • We rely on information technology systems, including third-party cloud computing systems, and data centers to deliver many of our products and services.
Our GoDaddy Guides also market our brand through their recommendations of our products or solutions to specifically meet the needs of our customers. In order to maintain and grow our revenues, we need to continuously optimize and diversify our marketing campaigns and strategies and increase our efforts to expand customer awareness of our portfolio of products.
Our GoDaddy Guides also market our brand through their recommendations of our products or solutions to specifically meet the needs of our customers. In order to maintain and grow our revenues, we need to continuously optimize and diversify our marketing campaigns and strategies and increase our efforts to expand customer awareness of our brand and portfolio of products.
In addition, any failure to design or operate effective controls, any difficulties encountered in their implementation or improvement, or any failure to implement adequate internal controls for our acquired companies could (i) harm our operating results, (ii) cause us to fail to meet our reporting obligations, (iii) adversely affect the results of management evaluations and independent registered public accounting firm audits of our internal control over financial reporting, which we are required to include in our periodic reports filed with the SEC, or (iv) cause investors to lose confidence in our reported financial and other information, any of which could have a negative effect on our stock.
Any failure to design or operate effective controls, any difficulties encountered in their implementation or improvement, or any failure to implement adequate internal controls for our acquired companies could (i) harm our operating results, (ii) cause us to fail to meet our reporting obligations, (iii) adversely affect the results of management evaluations and independent registered public accounting firm audits of our internal control over financial reporting, which we are required to include in our periodic reports filed with the SEC, or (iv) cause investors to lose confidence in our reported financial and other information, any of which could have a negative effect on our stock.
These restrictions limit the ability of our subsidiaries, and effectively place restrictions on our ability to, among other things: • incur or guarantee additional debt or issue disqualified equity interests; • pay dividends and make other distributions on, or redeem or repurchase, capital stock; • prepay, redeem or repurchase certain junior debt; • make certain investments; • incur certain liens; • enter into transactions with affiliates; • merge, consolidate or make certain other fundamental changes; • enter into agreements restricting the ability of restricted subsidiaries to make certain intercompany dividends, distributions, payments or transfers; and • transfer or sell assets.
These restrictions limit the ability of our subsidiaries, and effectively place restrictions on our own ability to, among other things: incur or guarantee additional debt or issue disqualified equity interests; pay dividends and make other distributions on, or redeem or repurchase, capital stock; prepay, redeem or repurchase certain junior debt; make certain investments; incur certain liens; enter into transactions with affiliates; merge, consolidate or make certain other fundamental changes; enter into agreements restricting the ability of restricted subsidiaries to make certain intercompany dividends, distributions, payments or transfers; and transfer or sell assets.
Further, to the extent we incur additional indebtedness or such other obligations, the risks associated with our significant debt described below, including our possible inability to service our debt, would increase. Additionally, events and circumstances may occur that would cause us to not be able to satisfy applicable draw-down conditions and utilize our revolving line of credit.
Further, to the extent we incur additional indebtedness or other such obligations, the risks associated with our significant debt described below, including our possible inability to service our debt, would increase. Additionally, events and circumstances may occur that could cause us to not be able to satisfy applicable draw-down conditions and utilize our revolving line of credit.
If we fail, or are perceived to fail, to make progress or achievements, or to maintain ESG practices that meet evolving regulations and stakeholder expectations, or if we revise any of our ESG commitments, initiatives or goals, our reputation and our ability to attract and retain employees could be harmed, we may receive negative media attention and we may be negatively perceived by our investors or our customers.
If we fail, or are perceived to fail, to make progress or achievements, or to maintain ESG practices that meet evolving laws, regulations and stakeholder expectations, or if we revise any of our ESG commitments, initiatives or goals, our reputation and our ability to attract and retain employees could be harmed, we may receive negative media attention and we may be negatively perceived by our investors or our customers.
If these competitors and potential competitors decide to devote greater resources to the development, promotion and sale of products in the markets in which we compete, or if the products offered by these companies are more attractive to or better meet the evolving needs of our customers, our market share, growth prospects and operating results may be adversely affected.
If our competitors decide to devote greater resources to the development, promotion and sale of products in the markets in which we compete, or if the products offered by these companies are more attractive to or better meet the evolving needs of our customers, our market share, growth prospects and operating results may be adversely affected.
We continue to review and add systems as necessary to accept payments in forms common outside of the U.S., optimize our marketing efforts in numerous non-U.S. geographies, equip our customer care team with the knowledge to serve these markets and maintain or establish customer care operations in overseas locations.
We continue to review and add systems as necessary to accept payments in forms common outside of the U.S., optimize our marketing efforts in numerous non-U.S. geographies, equip our customer care team with the knowledge to serve these markets and maintain or establish, as needed, customer care operations in overseas locations.
ICANN is a multi-stakeholder, private sector, not-for-profit corporation formed in 1998 for the express purposes of overseeing a number of Internet related tasks, including managing the DNS allocation of IP addresses, accreditation of domain name registrars and registries and the definition and coordination of policy development for all of these functions.
ICANN is a multi-stakeholder, private sector, not-for-profit corporation formed in 1998 for the express purposes of overseeing a number of Internet related tasks, including managing the DNS allocation of IP addresses, accreditation of domain name registrars and registries and the definition and coordination of policy development for these functions.
We are subject, and may become subject, to various restrictions with respect to our payments-related operations and payments products and services, including under U.S. federal, U.S. state and international laws and regulations, as well as restrictions set forth in agreements we have with payment card networks and third-party payment service providers. Payments Regulations .
We are subject, and may become subject, to various restrictions with respect to our payments-related operations and payments products and services, including under U.S. federal, U.S. state and international laws, rules and regulations, as well as restrictions set forth in agreements we have with payment card networks and third-party payment service providers. Payments Regulations .
We may have to pay cash, incur debt or issue equity securities to pay for future acquisitions, each of which could adversely affect our financial condition or the value of our Class A common stock. Equity issuances in connection with potential future acquisitions may also result in dilution to our stockholders.
In addition, we may have to pay cash, incur debt or issue equity securities to pay for future acquisitions, each of which could adversely affect our financial condition or the value of our Class A common stock. Equity issuances in connection with potential future acquisitions may also result in dilution to our stockholders.
We substantially rely upon AWS to operate our platform, and any disruption of or interference with our use of AWS would adversely affect our business, results of operations and financial condition. A substantial portion of our cloud infrastructure is provisioned through AWS, which hosts some of our products and platforms.
We substantially rely upon AWS to operate our integrated platform, and any disruption of or interference with our use of AWS would adversely affect our business, results of operations and financial condition. A substantial portion of our cloud infrastructure is provisioned through AWS, which hosts some of our products and platforms.
If we are found to be in violation of the export controls laws and regulations or economic sanctions laws and regulations, penalties may be imposed against us and our employees, including loss of export privileges and monetary penalties, which could have a material adverse effect on our business.
If we are found to be in violation of the export controls laws, rules and regulations or economic sanctions laws, rules and regulations, penalties may be imposed against us and our employees, including loss of export privileges and monetary penalties, which could have a material adverse effect on our business.
Some of our current and potential competitors have greater resources, more brand recognition and consumer awareness, more diversified product offerings, greater international scope and larger customer bases than we do, and we may therefore not be able to effectively compete with them.
Some of our current and potential competitors could have greater resources, more brand recognition and consumer awareness, more diversified product offerings, greater international scope and larger customer bases than we do, and we may therefore not be able to effectively compete with them.
In addition, if security of AWS is compromised, or our products or platform are unavailable or our users are unable to use our products within a reasonable amount of time or at all, then our business, results of operations and financial condition could be adversely affected.
In addition, if the security of AWS is compromised, or our products or platform are unavailable or our users are unable to use our products within a reasonable amount of time or at all, then our business, results of operations and financial condition could be adversely affected.
In addition, responding to any enforcement action may result in a diversion of management's attention and resources and significant defense costs and other professional fees. Changes in taxation laws and regulations may discourage the registration or renewal of domain names for e-commerce.
In addition, responding to any enforcement action may result in a diversion of management's attention and resources and significant defense costs and other professional fees. Changes in taxation laws, rules and regulations may discourage the registration or renewal of domain names for e-commerce.
In addition, some of our partners also collect or possess information about our customers, and we may be subject to litigation or our reputation may be harmed if our partners fail to protect our customers' information or if they use it in a manner inconsistent with our policies and practices.
In addition, some of our partners also collect or possess payment information about our customers, and we may be subject to litigation or our reputation may be harmed if our partners fail to protect our customers' payment information or if they use it in a manner inconsistent with our policies and practices.
Occasionally, one of our customers may register a domain name identical, or similar, to a third party's trademark or the name of a living person. These occurrences have in the past and may in the future lead to our involvement in disputes over such domain names.
Occasionally, one of our customers may register a domain name identical, or similar, to a third party's trademark or the name of a living person. These occurrences have in the past led, and may in the future lead, to our involvement in disputes over such domain names.
The adoption of any new laws or regulations, or the narrowing of any safe harbors, could hinder growth in the use of the Internet and online services generally, and decrease acceptance of the Internet and online services as a means of communications, e-commerce and advertising.
The adoption of any new laws, rules or regulations, or the narrowing of any safe harbors, could hinder growth in the use of the Internet and online services generally, and decrease acceptance of the Internet and online services as a means of communications, e-commerce and advertising.
We have incurred, and will continue to incur, expenses relating to our investments in international business and infrastructure, such as: (i) our offerings and marketing presence in India, Europe, Latin America, the Middle East and North Africa, and Asia; (ii) our marketing spend to attract new customers, such as WebPros and Independents in non-U.S. markets; and (iii) investments in software systems and additional data center resources to keep pace with the growth of our cloud infrastructure and cloud-based product offerings.
We have incurred, and expect to continue to incur, expenses relating to our investments in international business and infrastructure, such as: (i) our offerings and marketing presence in India, Europe, Latin America, the Middle East, North Africa, and Asia; (ii) our marketing spend to attract new customers, such as WebPros and Independents in non-U.S. markets; and (iii) investments in software systems and additional data center resources to keep pace with the growth of our cloud infrastructure and cloud-based product offerings.
Our business is exposed to risks associated with credit card and other payment chargebacks, fraud and new payment methods. A significant percentage of our revenue is processed through credit cards and other online payments.
Our business is exposed to risks associated with credit card and other payment chargebacks, fraud and new payment methods. A significant percentage of our revenue is processed through credit cards and other online payment methods.
We also expect to continue to invest for future growth and to expand our product offerings. In addition, we expect to continue to incur significant accounting, legal and other expenses as a public company.
We also expect to continue to invest for future growth and to expand our product offerings. In addition, as a public company, we expect to continue to incur significant accounting, legal and other expenses in the future.
In addition, as we expand our social media management and professional web services, we may be subject to potential liability for content we create on behalf of our customers.
In addition, as we expand our social media management and professional web services, we may be subject to liability for content we create on behalf of our customers.
Although we have disaster recovery plans in place, a significant natural disaster, such as an earthquake, fire or flood or other unusual or prolonged adverse weather patterns, whether due to climate change or otherwise, or acts of terrorism, civil unrest, pandemics, such as the COVID-19 pandemic, international conflicts, such as the conflicts between Russia and Ukraine and in the Middle East, or other similar events beyond our control could cause disruptions in our business or the business of our infrastructure vendors, data center hosting providers, partners or customers, our infrastructure vendors' abilities to provide connectivity and perform services on a timely basis or the economy as a whole.
Although we have disaster recovery plans in place, a significant natural disaster, such as an earthquake, fire or flood or other unusual or prolonged adverse weather patterns, whether due to climate change or otherwise, or acts of terrorism, civil unrest, pandemics, international conflicts, such as the conflicts between Russia and Ukraine and in the Middle East, or other similar events beyond our control could cause disruptions in our business or the business of our infrastructure vendors, data center hosting providers, partners or customers, our infrastructure vendors' abilities to provide connectivity and perform services on a timely basis or the economy as a whole.
The reliability and continuous availability of the software, hardware and workflow processes underlying our internal systems, networks and infrastructure and the ability to deliver our products are critical to our business.
The reliability, security and continuous availability of the software, hardware and workflow processes underlying our internal systems, networks and infrastructure and the ability to deliver our products are critical to our business.
Further, because of the substantial amount of discovery required in connection with litigation, there is a risk that some of our confidential business or other proprietary information could be compromised by disclosure. Failure to adequately protect and enforce our intellectual property rights could substantially harm our business and operating results.
Further, because of the, at times, substantial amount of discovery required in connection with litigation, there is a risk that some of our confidential business or other proprietary information could be compromised by disclosure. Failure to adequately protect and enforce our intellectual property rights could substantially harm our business and operating results.
As described in Note 2 to our audited financial statements, we generally recognize revenue from our customers ratably over the respective terms of their subscriptions in accordance with generally accepted accounting principles in the U.S. (GAAP). Our subscriptions can range from monthly terms to multi-annual terms of up to 10 years, depending on the product.
As described in Note 2 to our audited financial statements, we generally recognize revenue from our customers ratably over the respective terms of their subscriptions in accordance with generally accepted accounting principles in the U.S. (GAAP). Our subscriptions can range from monthly terms to multi-annual terms of up to ten years, depending on the product.
In addition, as we expand our presence in commerce through our GoDaddy Payments products and services, we face additional risks in payment processing due to customer screening, hardware failures, hardware servicing, manufacturing costs, and the procurement of hardware parts and materials and risks associated with the interface of our hardware products with third-party mobile devices.
In addition, as we expand our presence in commerce through our GoDaddy Payments products and services, we face additional risks in payment processing due to customer screening, customer related fraud, hardware failures and servicing, manufacturing costs, the procurement of hardware parts and materials, and risks associated with the interface of our hardware products with third-party mobile devices.
If fees continue to increase, costs to our customers could be higher, which could have an adverse impact on our results of operations. We have no control over ICANN, VeriSign or other domain name registries and cannot predict their future fee structures.
If fees continue to increase, costs to our customers could become higher, which could have an adverse impact on our results of operations. We have no control over ICANN, VeriSign or other domain name registries and cannot predict their future fee structures.
If we are unable to maintain our contractual relationships with existing partners or establish new contractual relationships with potential partners, we may not be able to offer the products and related functionality our customers expect. We maintain a network of different types of partners, some of which create integrations with our products.
If we are unable to maintain our contractual relationships with existing partners or establish new contractual relationships with potential partners, we may not be able to offer the products and related functionality our customers expect. We maintain a network of different types of partners, some of whom create integrations with our products.
To the extent any laws, regulations or rulings permit Internet service providers to charge some users higher rates than others for the delivery of their content, Internet service providers could attempt to use such law, regulation or ruling to impose higher fees or deliver our content with less speed, reliability or otherwise on a non-neutral basis as compared to other market participants, and our business could be adversely impacted.
To the extent any laws, regulations or rulings permit Internet service providers to charge some users higher rates than others for the delivery of their content, Internet service providers could attempt to use such laws, regulations or rulings to impose higher fees or deliver our content with less speed, reliability or otherwise on a non-neutral basis as compared to other market participants, and our business could be adversely impacted.
A portion of our GoDaddy Guides is engaged through third parties and not directly employed by us.
A portion of our GoDaddy Guides is engaged through third parties and not employed by us.
Any negative outcome from claims or litigation, including settlements, could result in payments of substantial monetary damages or fines, attorneys' fees or costly and significant and undesirable changes to our products, features, marketing efforts or business practices.
Any negative outcome from claims or litigation, including settlements, could result in payment of substantial monetary damages or fines, attorneys' fees or costly and significant and undesirable changes to our products, features, marketing efforts or business practices.
In addition, any changes in service levels from AWS may adversely affect our ability to meet our customers’ requirements, result in negative publicity which could harm our reputation and brand and may adversely affect the usage of our platform. We use AWS primarily for cloud-based server capacity and, to a lesser extent, storage and other optimization offerings.
In addition, any changes in service levels from AWS may adversely affect our ability to meet our customers’ requirements, result in negative publicity which could harm our reputation and brand and may adversely affect the usage of our platform. 30 Table of Contents We use AWS primarily for cloud-based server capacity and, to a lesser extent, storage and other optimization offerings.
Historically, equity awards have been a key component of our employee compensation program, and as a result, any decline in the price of our Class A common stock (directly or relative to the stock price of other companies with which we compete for talent) may adversely impact our ability to retain employees or to attract new employees.
Historically, equity awards have been a key component of our employee compensation program, and as a 34 Table of Contents result, any decline in the price of our Class A common stock (directly or relative to the stock price of other companies with which we compete for talent) may adversely impact our ability to retain employees or to attract new employees.
Accordingly, in the event of revenue or bookings shortfalls, we are generally unable to mitigate with commensurate reductions in operating expenses in the short term, which could adversely impact our operating results. We may release guidance in our quarterly earnings conference calls, quarterly earnings releases, or otherwise, based on predictions by management, which are necessarily speculative in nature.
Accordingly, in the event of revenue or bookings shortfalls, we may generally be unable to mitigate with commensurate reductions in operating expenses in the short term, which could adversely impact our operating results. We release guidance in our quarterly earnings conference calls, quarterly earnings releases, or otherwise, based on forecasts by management, which are necessarily speculative in nature.
Our corporate culture has contributed to our success, and if we cannot maintain this culture as we grow, we could lose the innovation, creativity, passion and teamwork that we believe contribute to our success and our business may be harmed.
Our company's culture has contributed to our success, and if we cannot maintain this culture as we grow, we could lose the innovation, creativity, passion and teamwork that we believe contribute to our success and our business may be harmed.
As we expand our international business, we have experienced an increase in litigation occurring outside of the U.S., due in part to consumer-friendly laws and regulations in certain countries and legal systems with limited experience with claims related to the domain industry. Defending such litigation is costly and time consuming.
As we have expanded our international business, we have experienced an increase in litigation occurring outside of the U.S., due in part to consumer-friendly laws, rules and regulations in certain countries and legal systems with limited experience with claims related to the domain industry. Defending such litigation is costly and time consuming.
It is possible that some open source software is governed by licenses containing requirements that we make available source code for modifications or derivative works we create based upon the open source software, and that we license such modifications or derivative works under the terms of a particular open source license or other license granting third parties certain rights of further use.
It is possible that some open source software is governed by licenses containing requirements that we make available source code for modifications or derivative works we create based upon the open source software, and that we license such modifications or derivative works under the terms of a particular 46 Table of Contents open source license or other license granting third parties certain rights of further use.
Although the ACPA, DMCA, CDA and relevant U.S. case law have generally shielded us from liability for customer activities to date, court rulings in pending or future litigation or future regulatory or legislative amendments may narrow the scope of protection afforded us under these laws.
Although the ACPA, DMCA, CDA and relevant U.S. case law have generally shielded us from liability for customer activities to date, court rulings in pending or future litigation or future 42 Table of Contents regulatory or legislative amendments may narrow the scope of protection afforded us under these laws.
New or revised taxes, particularly sales and other transaction taxes, would likely increase the cost of doing business online and decrease the attractiveness of advertising and selling goods and services over the Internet. New taxes could also create significant increases in 54 Table of Contents internal costs necessary to capture data and to collect and remit taxes.
New or revised taxes, particularly sales and other transaction taxes, would likely increase the cost of doing business online and decrease the attractiveness of advertising and selling goods and services over the Internet. New taxes could also create significant increases in internal costs necessary to capture data and to collect and remit taxes.
Our future success and ability to innovate also depends, in part, on our ability to continue to hire, retain, manage and motivate highly skilled personnel. The loss of the services of any of our key personnel, the inability to attract or retain qualified personnel or delays in hiring required personnel, may seriously harm our business, financial condition and operating results.
Our future performance and success also depends, in part, on our ability to continue to hire, retain, manage and motivate highly skilled personnel. The loss of any of our key personnel, the inability to attract or retain qualified personnel or delays in hiring required personnel, may seriously harm our business, financial condition and operating results.
Moreover, the adoption of any laws or regulations adversely affecting the growth, popularity or use of the Internet, including laws impacting Internet neutrality, could decrease the demand for our products and increase our operating costs. The legislative and regulatory landscape regarding the regulation of the Internet and, in particular, Internet neutrality, in the U.S. is subject to uncertainty.
Moreover, the adoption of any laws, rules or regulations adversely affecting the growth, popularity or use of the Internet, could decrease the demand for our products and increase our operating costs. The legislative and regulatory landscape regarding the regulation of the Internet and, in particular, Internet neutrality, in the U.S. is subject to uncertainty.
In the years ended December 31, 2023, 2022 and 2021, our marketing and advertising expenses were $352.9 million, $412.3 million and $503.9 million, respectively. If these costs or our customer acquisition costs increase or we fail to generate additional sales as a result of our marketing efforts, our business, operating results and financial performance could be adversely affected.
In the years ended December 31, 2024, 2023 and 2022, our marketing and advertising expenses were $356.9 million, $352.9 million and $412.3 million, respectively. If these costs or our customer acquisition costs increase or we fail to generate additional sales as a result of our marketing efforts, our business, operating results and financial performance could be adversely affected.
In addition, such a disruption could adversely impact our ability to serve our customers and to sell products to new and existing customers and we may experience a decline in our subscription renewal rates and in our ability to cross-sell our products and our reputation may suffer, any of which could adversely affect our business, reputation and operating results.
In addition, such a disruption could adversely impact our ability to serve our customers and to sell products to new and existing customers and we may experience a decline in our 32 Table of Contents subscription renewal rates and in our ability to cross-sell our products and our reputation may suffer, any of which could adversely affect our business, reputation and operating results.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
A material weakness is a deficiency, or a combination of deficiencies, in internal control over 52 Table of Contents financial reporting, such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis.
For the years ended December 31, 2023, 2022 and 2021, approximately 9%, 10%, and 11% of our total bookings, respectively, were generated from the sale of product subscriptions by our GoDaddy Guides. Most of our current offerings are designed for customers who often self-identify as having limited to no technology skills.
For the years ended December 31, 2024, 2023 and 2022, approximately 8%, 9%, and 10% of our total bookings, respectively, were generated from the sale of product subscriptions by our GoDaddy Guides. Most of our current offerings are designed for customers who often self-identify as having limited to no technology skills.
We may be unable to project accurately the rate or timing of these increases or to successfully allocate resources to address such increases, which could have a negative impact on 30 Table of Contents customer experience and our financial results.
We may be unable to project accurately the rate or timing of these increases or to successfully allocate resources to address such increases, which could have a negative impact on customer experience and our financial results.
Data breaches can also occur as a result of non-technical issues. Under our contracts with our processors, if there is unauthorized access to, or disclosure of, credit card information we store, we could be liable to the credit card issuing banks for their cost of issuing new cards and related expenses.
Cybersecurity incidents can also occur as a result of non-technical issues. Under our contracts with our processors, if there is unauthorized access to, or disclosure of, credit card information we store, we could be liable to the credit card issuing banks for their cost of issuing new cards and related expenses.
However, we may face liability if we act in bad faith or fail to comply in a timely manner with procedural requirements under these rules, including 52 Table of Contents forfeiture of domain names in connection with UDRP actions.
However, we may face liability if we act in bad faith or fail to comply in a timely manner with procedural requirements under these rules, including forfeiture of domain names in connection with UDRP actions.
A prolonged service disruption for any of the foregoing reasons would negatively impact our ability to serve our customers and could damage our reputation with current and potential customers, expose us to liability, cause us to lose customers or otherwise harm our business.
A prolonged service disruption for any of the foregoing reasons would negatively impact our ability to serve our customers and could damage our reputation, expose us to liability, cause us to lose customers or otherwise harm our business.
Our quarterly and annual operating results and key metrics have varied from period to period in the past, and may fluctuate in the future as a result of a number of factors, many of which are outside of our control, including, among other things: • our ability to attract new customers and retain existing customers; • the timing and success of introductions of new products; • changes in the growth rate of small businesses and ventures; • changes in renewal rates for our subscriptions and our ability to sell additional products to existing customers; • higher than expected refunds to our customers; • the timing of revenue recognition relative to the recording of the related expense; • any negative publicity or other actions which harm our brand; • the timing of our marketing expenditures; • the mix of products sold and our use of "freemium" promotions for those products; • our ability to maintain a high level of personalized customer care and resulting customer satisfaction; • competition in the market for our products; • our ability to expand internationally; • changes in foreign currency exchange rates; • rapid technological change, frequent new product introductions and evolving industry standards; • our ability to implement new financial and other administrative systems; • actual or perceived cybersecurity incidents; • systems, data center and Internet failures, breaches and service interruptions; • actions by foreign governments that reduce access to the Internet for their citizens; • changes in U.S. or foreign regulations, such as the CCPA and GDPR, that could impact one or more of our product offerings or changes to regulatory bodies, such as ICANN, as well as increased regulation by governments or multi-governmental organizations, such as the International Telecommunications Union, a specialized agency of the United Nations or the E.U., that could affect our business and our industry; • a delay in the authorization of new TLDs by ICANN or our ability to secure operator rights for new TLDs, both of which would impact the breadth of our customer offerings; • any changes in industry rules restricting our ability to hold domains for sale on the aftermarket; • shortcomings in, or misinterpretations of, our metrics and data which cause us to fail to anticipate or identify market trends; • terminations of, disputes with, or material changes to our relationships with third-party partners, including referral sources, product partners and payment processors; • reductions in the selling prices for our products; • costs and integration issues associated with acquisitions we may make; • changes in legislation affecting our collection of indirect taxes both in the U.S. and in foreign jurisdictions; • changes in legislation affecting exposure to liability resulting from actions of our customers; • increases in rates of failed sales on our aftermarket platform for transactions in which we act as the primary obligor, resulting in higher than expected domain portfolio assets; • timing of expenses; 39 Table of Contents • macroeconomic conditions and the related impact on the worldwide economy, including the effects of inflation, deflation or a recession or other adverse economic conditions; • threatened or actual litigation; and • loss of key employees.
Our quarterly and annual operating results and key metrics have varied from period to period in the past, and may fluctuate in the future as a result of a number of factors, many of which are outside of our control, including, among other things: • our ability to attract new customers and retain existing customers; • the timing and success of introductions of new products; • changes in the growth rate of small businesses and ventures; • changes in renewal rates for our subscriptions and our ability to sell additional products to existing customers; • higher than expected refunds to our customers; • the timing of revenue recognition relative to the recording of the related expense; • any negative publicity or other actions which harm our brand; • the timing of our marketing expenditures; • the mix of products sold and our use of "freemium" promotions and free trials for those products; • our ability to maintain a high level of personalized customer care and resulting customer satisfaction; • competition in the market for our products; • our ability to expand internationally; • changes in foreign currency exchange rates; • rapid technological change, frequent new product introductions and evolving industry standards; • our ability to implement new financial and other administrative systems; • actual or perceived cyber attacks or other incidents; • systems, data center and Internet failures, breaches and service interruptions; • actions by foreign governments that reduce access to the Internet for their citizens; • changes in or increases to U.S. or foreign regulations or regulations by governments or multi-governmental organizations, that could impact one or more of our product offerings; • changes to regulatory bodies, such as ICANN; • a delay in the authorization of new TLDs by ICANN or our ability to secure operator rights for new TLDs, both of which would impact the breadth of our customer offerings; 35 Table of Contents • any changes in industry rules restricting our ability to hold domains for sale on the aftermarket; • shortcomings in, or misinterpretations of, our metrics and data which cause us to fail to anticipate or identify market trends; • terminations of, disputes with, or material changes to our relationships with third-party partners, including referral sources, product partners and payment processors; • reductions in the selling prices for our products; • costs and integration issues associated with acquisitions we may make; • changes in legislation affecting our collection of indirect taxes both in the U.S. and in foreign jurisdictions; • changes in legislation affecting exposure to liability resulting from actions of our customers; • increases in rates of failed sales on our aftermarket platform for transactions in which we act as the primary obligor, resulting in higher than expected domain portfolio assets; • timing of expenses; • macroeconomic conditions and the related impact on the worldwide economy, including the effects of inflation, deflation or a recession or other adverse economic conditions; • threatened or actual litigation; and • loss of key employees.
Additionally, we continue to face the following possibilities: • the structure and accountability mechanisms contained in ICANN's bylaws, amended in November 2019, are not fully tested, which may result in ICANN not being accountable to its stakeholders and unable to make, implement or enforce its policies; • the Internet community, key commercial industry participants, the U.S. government or other governments may (i) refuse to recognize ICANN's authority or support its policies, (ii) attempt to exert pressure on ICANN, or (iii) enact laws in conflict with ICANN's policies, each of which could create instability in the domain name registration system; • governments, via ICANN's Governmental Advisory Committee (GAC), may seek greater influence over ICANN policies and contracts with registrars and may advocate changes that may adversely affect our business; • the terms of the Registrar Accreditation Agreement (RAA) under which we are accredited as a registrar or the Registry Agreement (RA) under which we are accredited as a registry, could change in ways that are disadvantageous to us or under certain circumstances could be terminated by ICANN, thereby preventing us from 44 Table of Contents operating our registrar or registry service, or ICANN could adopt unilateral changes to the RAA or RA that are unfavorable to us, that are inconsistent with our current or future plans, or that affect our competitive position; • international regulatory or governing bodies, such as the International Telecommunications Union, a specialized agency of the United Nations, or the E.U., may gain increased influence over the management and regulation of the domain name registration system, leading to increased regulation in areas such as taxation, privacy and the monitoring of our customers' hosted content; • ICANN or any third-party registries may implement policy changes impacting our ability to run our current business practices throughout the various stages of the lifecycle of a domain name; • the U.S.
Additionally, we continue to face the following possibilities: • the structure and accountability mechanisms contained in the Bylaws for ICANN, as amended on November 17, 2023, are not fully tested, which may result in ICANN not being accountable to its stakeholders and unable to make, implement or enforce its policies; • the Internet community, key commercial industry participants, the U.S. government or other governments may (i) refuse to recognize ICANN's authority or support its policies, (ii) attempt to exert pressure on ICANN, or (iii) enact laws in conflict with ICANN's policies, each of which could create instability in the domain name registration system; • governments, via ICANN's Governmental Advisory Committee (GAC), may seek greater influence over ICANN policies and contracts with registrars and may advocate changes that may adversely affect our business; • the terms of the Registrar Accreditation Agreement (RAA) under which we are accredited as a registrar or the Registry Agreement (RA) under which we are accredited as a registry, could change in ways that are disadvantageous to us or under certain circumstances could be terminated by ICANN, thereby preventing us from 39 Table of Contents operating our registrar or registry service, or ICANN could adopt unilateral changes to the RAA or RA that are unfavorable to us, that are inconsistent with our current or future plans, or that affect our competitive position; • international regulatory or governing bodies, such as the International Telecommunication Union, a specialized agency of the United Nations, or the E.U., may gain increased influence over the management and regulation of the domain name registration system, leading to increased regulation in areas such as taxation, privacy, data protection, cybersecurity and the monitoring of our customers' hosted content; • ICANN or any TLD operators may implement policy changes impacting our ability to run our current business practices throughout the various stages of the lifecycle of a domain name; • the U.S.
Conducting and expanding international business subjects us to risks we generally do not face in the U.S., including: • management, communication and integration problems resulting from language barriers, cultural differences and geographic dispersion of our customers and personnel; • language translation of, and associated customer care guidance for, our products; • compliance with foreign laws, including laws regarding consumer protection, the Internet and e-commerce or mobile commerce, intellectual property, online disclaimers and advertising, liability of Internet service providers for activities of customers especially with respect to hosted content, competition, anti-bribery, and more stringent laws in foreign jurisdictions relating to consumer privacy and protection of data collected from individuals and other third parties; • accreditation and other regulatory requirements to do business and to provide domain name registration and registry services, web-hosting and other products in foreign jurisdictions; • greater difficulty in enforcing contracts, including our universal terms of service and other agreements due to differences in local legal regimes and court systems; • increased expenses incurred in establishing and maintaining office space and equipment for our international business; • greater costs and expenses associated with international marketing and operations; • greater risk of unexpected changes in regulatory practices, tariffs, trade disputes and tax laws and treaties; • increased exposure to foreign currency risks; • heightened risk of unfair or corrupt business practices in certain geographies, and compliance with anti-corruption laws, such as the U.S.
Conducting and expanding international business subjects us to risks we generally do not face in the U.S., including: • management, communication and integration problems resulting from language barriers, cultural differences and geographic dispersion of our customers and personnel; • language translation of, and associated customer care guidance for, our products; • compliance with international laws, rules and regulations, including laws, rules and regulations regarding consumer protection, the Internet and e-commerce or mobile commerce, intellectual property, online disclaimers and advertising, liability of Internet service providers for activities of customers especially with respect to hosted content, competition, anti-bribery, privacy, data protection and cybersecurity; • accreditation and other regulatory requirements to do business and to provide domain name registration and registry services, web-hosting and other products in foreign jurisdictions; 26 Table of Contents • greater difficulty in enforcing contracts, including our universal terms of service and other agreements due to differences in local legal regimes and court systems; • increased expenses incurred in establishing and maintaining office space and equipment for our international business; • greater costs and expenses associated with international marketing and operations; • greater risk of unexpected changes in regulatory practices, tariffs, trade disputes and tax laws and treaties; • increased exposure to foreign currency risks; • heightened risk of unfair or corrupt business practices in certain geographies, and compliance with anti-corruption laws, such as the U.S.
Our failure to meet our own or other publicly stated revenue, bookings or earnings forecasts, or failure to meet securities analyst or investor expectations even when we meet our own forecasts, could cause our stock price to decline and expose us to lawsuits, including securities class action suits. Such litigation could impose substantial costs and divert management's attention and resources.
Our failure to meet our own or other publicly stated financial forecasts, or failure to meet securities analyst or investor expectations even when we meet our own forecasts, could cause our stock price to decline and expose us to lawsuits, including securities class action suits. Such litigation could impose substantial costs and divert management's attention and resources.
We could also be materially and adversely affected through penalties, reputational harm, loss of access to certain markets, or otherwise if we are found to have violated these laws and regulations. Due to the global nature of our business, we could be adversely affected by violations of anti-bribery and anti-corruption laws.
We could also be materially and adversely affected through penalties, reputational harm, loss of access to certain markets, or otherwise if we are found to have violated these laws, rules and regulations. 47 Table of Contents Due to the global nature of our business, we could be adversely affected by violations of anti-bribery and anti-corruption laws.
Despite testing, system and process failures and other vulnerabilities may remain undetected or unknown, which could result in compromised customer data, loss of or delay in revenues, failure to achieve market acceptance, injury to our reputation or increased product costs, any of which could harm our business.
Despite testing, system and process failures, cybersecurity threats and other vulnerabilities may remain undetected or unknown, which could result in compromised customer data, loss of or delay in revenues, failure to achieve market acceptance, injury to our reputation, increased product costs or other negative impacts, any of which could harm our business.
Revenue growth may slow or decline, or we may incur significant losses in the future for any reason, including deteriorating general macroeconomic conditions, increased competition, a decrease in the growth of the markets in which we operate or have business, or if we fail for any reason to continue to capitalize on growth opportunities.
In the future, our revenue growth may slow or decline, or we may incur significant losses for any reason, including deteriorating general macroeconomic conditions, increased competition, a decrease in the growth of the markets 36 Table of Contents in which we operate or have business, or if we fail for any reason to continue to capitalize on growth opportunities.
If we do not successfully develop and market products that anticipate or respond timely to the needs of our customers, our business and operating results may suffer. The markets where we compete are characterized by constant change and innovation, frequent new product and service introductions and evolving industry standards, and we expect them to continue to evolve rapidly.
If we do not successfully develop and market products that anticipate or respond timely to the needs of our customers, our business and operating results may suffer. The markets in which we compete are characterized by constant change and innovation, frequent new product and service introductions and evolving industry standards. We expect these markets to continue to rapidly evolve.
Fraudulent activity can result in, among other things, interruption of our services to our customers, and substantial and reputational harm.
Fraudulent activity can result in, among other things, interruption of our services to our customers, and substantial business and reputational harm to ourselves and to our customers.
Our future performance depends in part on the services and performance of our senior management, as well as our experienced and capable employees. If we are unable to attract, motivate, and retain our employees, our business could suffer.
Our future performance depends in part on the services and performance of our senior management, as well as key employees. If we are unable to attract, motivate, and retain our employees, our business could suffer.
We have programs to vet and monitor these customers and the transactions we process for them as part of our risk management efforts, but such programs require continuous improvement and may not be effective in detecting and preventing fraud and illegitimate transactions.
We have programs to vet and monitor these customers, their GoDaddy Payments' accounts, and the transactions we process for them as part of our risk management efforts, but such programs require continuous improvement and may not be effective in detecting and preventing fraud and illegitimate transactions.
If we enable or offer solutions that draw controversy, or these new offerings do not work as we describe them to our customers, we may experience brand or reputational harm, competitive harm or legal liability.
If we enable or offer solutions that draw controversy, or these new offerings do not work as we describe them, we may experience brand or reputational harm, competitive harm or legal liability.
Legal and Regulatory Risks Governmental and regulatory policies or claims concerning the domain name registration system and the Internet in general, and industry reactions to those policies or claims, may cause instability in the industry and disrupt our business.
Legal and Regulatory Risks Laws, regulations, policies or claims concerning the domain name registration system and the Internet in general, and industry reactions to those policies or claims, may cause instability in the industry and disrupt our business.
In the event our or our service providers' IT systems' abilities are hindered by any of the events discussed above, we and our customers' websites could experience downtime, and our products could become unavailable.
In the event our or our service providers' IT systems' are hindered by any of the events discussed above or otherwise, we could experience downtime, our products could become unavailable or our customers' websites could experience downtime or become unavailable.
In addition, although our customers are required to set passwords or personal identification numbers to protect their accounts, third parties have in the past been, and may in the future be, able to access and use our customers' accounts through fraudulent means.
In addition, although our customers are required to set passwords or personal identification numbers 31 Table of Contents to protect their accounts, third parties have in the past been, and may in the future be, able to access and use our customers' accounts through fraudulent means.
If we or our GoDaddy Payments business were found to be in violation of applicable laws or regulations, we could be subject to additional operating requirements and/or civil and criminal penalties or forced to cease providing certain services. Payment Card Networks .
If we or our GoDaddy Payments business were found to be in violation of applicable laws, rules or regulations, we could be subject to additional operating requirements and/or civil and criminal penalties or forced to cease providing certain services. 48 Table of Contents Payment Card Networks .
Our new products or product enhancements could fail to attain meaningful customer acceptance for many reasons, including: • failure to accurately predict market demand or customer preferences; • defects, errors or failures in product design or performance; • negative publicity about product performance or effectiveness, including negative comments on social media; • the perceived value of our products or product enhancements relative to their cost; • changing regulatory requirements adversely affecting the products we offer; and • poor business conditions for our customers or poor general macroeconomic conditions.
Our new products or product enhancements could fail to attain meaningful customer acceptance for many reasons, including: • failure to accurately predict market demand or customer preferences; • failure to bring products to market on a timely or cost effective basis; • defects, errors or failures in product design or performance; • negative publicity about product performance or effectiveness, including negative comments on social media; • the perceived value of our products or product enhancements relative to their cost; • scalability of products or product enhancements; • general satisfaction of our customers; • changing regulatory requirements adversely affecting the products we offer; and • poor business conditions for our customers or poor general macroeconomic conditions.
The loss of services of senior management or other key employees and the hiring of new senior leaders and key employees, especially in a competitive labor 35 Table of Contents market, could significantly delay or prevent our achievement of strategic objectives, business plans and product development as we transition to new leaders and could adversely affect our business, financial condition and operating results.
The loss of any senior management or other key employees and the hiring of new senior leaders and key employees, especially in a competitive labor market, could significantly delay or prevent our achievement of strategic objectives, business plans and product development as we transition to new leaders and could adversely affect our business, financial condition and operating results.
In addition, we could be liable if there is a breach of the payment information we store. Online commerce and communications depend on the secure transmission of confidential information over public networks. Additionally, with the expansion of our offerings through GoDaddy Payments products and services, we face additional burdens in securing and transmitting payment information.
In addition, we could be liable if there is a cybersecurity incident affecting the payment information we store. Online commerce and communications depend on the secure transmission of confidential information over public networks. With the expansion of our offerings through GoDaddy Payments products and services, we face additional burdens in securing and transmitting payment information.
We may experience interruptions, delays and outages in service and availability of AWS services due to a variety of factors, including infrastructure changes, human or software errors, website hosting disruptions and capacity constraints due to any number of potential causes, including technical failures, natural disasters, pandemics such as the COVID-19 pandemic, fraud or cybersecurity attacks, all of which could impact our service to our customers.
We may experience interruptions, delays and outages in service and availability of AWS services due to a variety of factors, including infrastructure changes, human or software errors, website hosting disruptions and capacity constraints due to any number of potential causes, including technical failures, natural disasters, pandemics, fraud or cybersecurity attacks, all of which could impact our service to our customers.
Tax laws are dynamic and subject to change as new laws are passed and new interpretations of the laws are issued or applied.
Tax laws are dynamic and subject to change as new laws are passed and new interpretations of existing laws are issued or applied.
As of December 31, 2023, we had 368 issued patents in the U.S. and other countries covering various aspects of our product offerings. Additionally, as of December 31, 2023, we had 12 pending U.S. and international patent applications and intend to file additional patent applications in the future.
As of December 31, 2024, we had 368 issued patents in the U.S. and other countries covering various aspects of our product offerings. Additionally, as of December 31, 2024, we had 11 pending U.S. and international patent applications and intend to file additional patent applications in the future.
Some of these 49 Table of Contents providers can take measures including legal actions, that could degrade, disrupt or increase the cost of user access to certain of our products by restricting or prohibiting the use of their infrastructure to support our offerings, charging increased fees to our users to provide our offerings, or regulating online speech.
Some of these providers can take measures including legal actions, which could degrade, disrupt or increase the cost of user access to certain of our products by restricting or prohibiting the use of their infrastructure to support our offerings, charging increased fees to our users to provide our offerings, or regulating online speech.
Defending patent and other intellectual property claims and litigation is costly and can impose a significant burden on management and employees, and there can be no assurances that favorable final outcomes will be obtained in all cases.
Defending patent and other intellectual property claims and litigation is costly and can impose a significant burden on management and employees, and there can be no assurances that 45 Table of Contents favorable final outcomes will be obtained in all cases.
Certain countries have enacted or are expected to enact legislation to be effective as early as 2024, with widespread implementation of a global minimum tax expected by 2025.
Certain countries have enacted or are expected to enact legislation to be effective in 2024, with widespread implementation of a global minimum tax expected by 2025.
Although our terms of service prohibit the illegal use of our 48 Table of Contents products by our customers and permit us to take down or suspend websites or take other appropriate actions in response to illegal uses, customers may nonetheless engage in prohibited activities or upload or store content on our products in violation of applicable law or the customer's own policies, which could subject us to liability.
Although our terms of service prohibit the illegal use of our products by our customers and permit us to take down or suspend websites or take other appropriate actions in response to illegal uses (among other reasons), customers may nonetheless engage in prohibited activities or upload or store content on our products in violation of applicable law, our agreement or policies, or the customer's own policies, which could subject us to liability.
We rely heavily on the reliability, security and performance of our internally developed systems and operations. Any difficulties in maintaining these systems may result in damage to our brand, service interruptions, decreased customer service or increased expenditures.
We are dependent on the reliability, security and performance of our internally developed systems and operations. Any difficulties in maintaining these systems may result in damage to our brand, service interruptions, decreased customer service or increased expenditures.
Factors that may cause the market price of our Class A common stock to fluctuate includ e: • price and volume fluctuations in the overall stock market from time to time; • significant volatility in the market price and trading volume of technology companies in general, and of companies in our industry; • actual or anticipated changes in our results of operations or fluctuations in our operating results; • whether our operating results meet the expectations of securities analysts or investors; • failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities analysts who follow our company or our failure to meet the estimates or the expectations of investors; • announcements of new products or technologies, commercial relationships, acquisitions or other events by us or our competitors; • actual or anticipated developments in our competitors' businesses or the competitive landscape generally; • actual or perceived privacy or cybersecurity incidents; • litigation involving us, our industry or both; • regulatory developments in the U.S., foreign countries or both; • general economic conditions and trends; • the commencement or termination of any share repurchase program; • new laws or regulations or new interpretations of existing laws or regulations applicable to our business; 56 Table of Contents • network or service outages, Internet disruptions, the availability of our service, security breaches or perceived security breaches and vulnerabilities; • changes in accounting standards, policies, guidelines, interpretations or principles; • actions instituted by activist shareholders or others; • sales of large blocks of our stock; • departures of key personnel; or • major catastrophic events, including those resulting from war, incidents of terrorism, outbreaks of pandemic diseases, such as COVID-19, or responses to these events.
Factors that may cause the market price of our Class A common stock to fluctuate include: • price and volume fluctuations in the overall stock market from time to time; • significant volatility in the market price and trading volume of technology companies in general, and of companies in our industry; • actual or anticipated changes in our results of operations or fluctuations in our operating results; • whether our operating results meet the expectations of securities analysts or investors; • failure of securities analysts to initiate or maintain coverage of our company, changes in financial estimates or ratings by any securities analysts who follow our company or our failure to meet the estimates or the expectations of investors; • announcements of new products or technologies, commercial relationships, acquisitions or other events by us or our competitors; • actual or anticipated developments in our competitors' businesses or the competitive landscape generally; • actual or perceived cyber attacks or other cybersecurity incidents; • litigation involving us, our industry or both; • regulatory developments in the U.S., foreign countries or both; • general economic conditions and trends; • the commencement or termination of any share repurchase program; • new laws, regulations, other legal obligations or industry standards, or any modifications to, or new interpretations of, existing laws, regulations, other legal obligations or industry standards applicable to our business; • network or service outages, Internet disruptions, the availability of our service and vulnerabilities; • changes in accounting standards, policies, guidelines, interpretations or principles; • actions instituted by activist shareholders or others; • sales of large blocks of our stock; • departures of key personnel; or • major catastrophic events, including those resulting from war, incidents of terrorism, outbreaks of pandemic diseases, or responses to these events.
Furthermore, we have incurred in recent periods, and may incur in future periods, large expenses which are not recurring, but which nonetheless negatively impact our operating results. As a result of our increased expenditures, we will have to generate and sustain increased revenue to maintain future profitability.
Furthermore, we have incurred in recent periods, and may incur in future periods, large expenses which are not recurring, but which nonetheless negatively impact our operating results. As a result of our increased expenditures, we have needed and expect to continue to need to generate and sustain increased revenue to maintain future profitability.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe company's CEO has more than 27 years' experience in ecommerce technology, engineering, and other related areas. The CISO, CTO, and CEO work together to assess and manage cybersecurity-related risks. The CISO is responsible for day-to-day operations working with an enterprise-wide cybersecurity team that provides 24/7/365 support.
Biggest changeOur CISO has more than 19 years' experience in cybersecurity, networking, and related technologies. Our CEO has more than 28 years' experience in e-commerce technology, engineering, and other related areas. Our CISO works with an enterprise-wide cybersecurity team that provides 24/7/365 support. Our cybersecurity policies, procedures, and strategies primarily are implemented by our information security department.
Other personnel and departments in the company also assist with cybersecurity risk management, including but not limited to the company's technology organization and the company's privacy, legal, third-party risk management, and corporate audit services teams. The company also has developed processes to integrate cybersecurity risk management within the company's product and software development processes.
Other personnel and departments in the company also assist with cybersecurity risk management, including but not limited to our technology organization and our privacy, legal, vendor risk management, and corporate audit services teams. We have also developed processes to integrate cybersecurity risk management within the company's product and software development processes.
Our control over and ability to monitor the security posture of third parties with whom we do business remains limited and there can be no assurance that we can prevent, mitigate or remediate the risk of any compromise or failure in the security infrastructure owned or controlled by such third parties.
Despite our efforts, our control over and ability to monitor the security of third parties is limited and there can be no assurance that we can prevent, mitigate or remediate the risk of any compromise or failure in the security infrastructure owned or controlled by third parties.
We also require security training for all GoDaddy personnel, including instructions regarding the proper methods for reporting potential cybersecurity incidents that are not captured through our monitoring solutions. We also provide mechanisms for interested third parties, including security researchers and law enforcement to provide us notice of potential cybersecurity threats.
We require security training for all company personnel, including instructions regarding the proper methods for reporting potential cybersecurity incidents. We also provide mechanisms for interested third parties, including security researchers and law enforcement, to provide notice of potential cybersecurity threats.
When engaging a third-party vendor or service provider, we use a variety of processes and controls to identify and oversee risks relating to that engagement, which may include one or more of the following depending on the scope and nature of the engagement: • incorporating provisions in vendor contracts that require third parties meet certain minimum cybersecurity standards based on the nature of the product or service provided; • installing monitoring software and other tools to detect malicious software and activities in systems operated by third parties; • maintaining processes for monitoring for and applying updates and patches to third-party hardware and software to address vulnerabilities; and • performing security and data privacy assessments before engaging new vendors or acquiring new hardware and software.
When engaging a third-party vendor or service provider, we use a variety of processes and controls to identify and oversee risks relating to that engagement, which may include one or more of the following: • including provisions in vendor contracts that set minimum cybersecurity requirements; • installing monitoring software to detect malicious software and activities in third party systems; • monitoring for and applying patches to third-party hardware and software to address vulnerabilities; and • performing security assessments before engaging new vendors or acquiring new hardware and software.
Item 1C. Cybersecurity GoDaddy maintains an enterprise-wide cybersecurity program designed to manage risks to the company's information systems from cybersecurity threats and cybersecurity incidents. Board and Audit and Finance Committee Governance Our board of directors (the Board) is committed to managing data privacy and cybersecurity risks as part of the company's overall risk management framework.
Item 1C. Cybersecurity GoDaddy maintains an enterprise-wide cybersecurity program designed to manage cybersecurity risk. Board and Audit and Finance Committee Governance Our board of directors (the Board) manages cybersecurity risks as part of the company's overall risk management framework. The Board oversees the company's cybersecurity risk management program through the Board's Audit and Finance Committee (the Audit Committee).
The Audit Committee receives verbal and written reports at least quarterly from GoDaddy's Chief Information Security Officer (CISO) regarding the state of the company's cybersecurity risk management program, the company's current material cybersecurity risks, and general cybersecurity-related risks.
The Audit Committee receives verbal and written reports at least quarterly from GoDaddy's Chief Information Security Officer (CISO) regarding our company's cybersecurity risk management program and cybersecurity-related risks. The Audit Committee consists of Board members with diverse expertise in risk management, technology, finance and cybersecurity, including oversight of security teams.
Potential and actual cybersecurity incidents primarily are handled by our internal incident response team, which is supervised by our CISO. Our incident response team is responsible for assessing the potential risk posed by an incident, providing notice to appropriate stakeholders in the company based on the perceived risk, and coordinating the assessment, containment, mitigation, and remediation efforts.
Our incident response team is responsible for assessing the potential risk posed by an incident, providing notice to appropriate stakeholders in the company based on the perceived risk, and coordinating the assessment, containment, mitigation, and remediation efforts. Depending on the severity and scope of the incident, we also may engage external consultants.
Our third-party financial auditors also include material cybersecurity risks and events as part of their financial audits. Third-Party Cybersecurity Risk Management We engage with third parties to provide us with hardware, software, and services to operate our information systems and run our business.
Third-Party Cybersecurity Risk Management We engage with third parties to provide us with hardware, software, and services to operate our information systems and run our business. We also rely on third parties to provide hardware, software, and services relating to our cybersecurity program.
In addition, the company's CISO and Chief Technology Officer (CTO) provide the full Board with written quarterly and annual reports on the state of the company's cybersecurity program and material cybersecurity-related risks, and the chair of the Audit Committee provides a quarterly summary of the Audit Committee's cybersecurity discussion to the full Board.
Our CISO provides the full Board with written quarterly and annual reports on our cybersecurity program and material cybersecurity-related risks, and the chair of the Audit Committee provides a quarterly summary of the Audit Committee's cybersecurity discussion to the full Board. Management of Cybersecurity Risk Our senior management is responsible for identifying, assessing, and managing the company's material cybersecurity risks.
We use third-party auditors and consultants in connection with obtaining and maintaining our certifications for certain products and services. We also have engaged third-party consultants in the past and may engage third-party consultants in the future for specific projects and engagements, such as responding to cybersecurity incidents.
We also have engaged third-party consultants in the past and may engage third-party consultants in 54 Table of Contents the future for specific projects and engagements, such as responding to cybersecurity incidents. Our third-party financial auditors also include material cybersecurity risks and events as part of their financial audits.
Cybersecurity Threat Monitoring and Incident Response GoDaddy monitors for threats to our information systems on an ongoing basis through a combination of automated intrusion detection monitoring solutions, review of log data, and other related activities.
Additionally, any contractual protections with such third parties may be limited or insufficient to prevent a negative impact on our business from such compromise or failure. Cybersecurity Threat Monitoring and Incident Response We monitor for threats to our information systems through a combination of automated intrusion detection monitoring solutions, review of log data, and other activities.
Depending on the severity and scope of the incident, we may also engage external consultants. Security personnel and consultants retained by our service providers may also be involved in cases where our vendors experience a cybersecurity incident.
Security personnel and consultants retained by our service providers also may be involved in cases where our vendors experience a cybersecurity incident. We have processes for escalating an incident to determine whether it is material and requires notification required under applicable laws, rules and regulations.
In addition, product teams and business unit leaders are involved in cybersecurity risk management during product development with support from our enterprise-wide security team supervised by the CISO. Third-Party Consultants and Auditors GoDaddy maintains industry certifications for some of the services we provide, including certifications relating to our GoDaddy Registrar, Registry, Domains, and Commerce businesses.
In addition, product teams and business unit leaders are involved in product-related cybersecurity risk management. Third-Party Consultants and Auditors We use uses third-party auditors and consultants in connection with obtaining and maintaining industry certifications for certain products and services.
The CISO regularly confers with the CTO and CEO on cybersecurity matters, including providing notice of cybersecurity threats and incidents, including those that have the potential to have material effects. The CISO also provides written monthly and quarterly reports on the state of the company's cybersecurity program and cybersecurity risks to the CTO, CEO, and other key executives.
Our CISO oversees our programs for identifying, assessing, and managing our cybersecurity risks. Our CISO reports to our Chief Operating Officer (COO) and regularly provides updates to our CEO on significant cybersecurity-related matters. Our CISO also provides written monthly and quarterly reports on our cybersecurity program and risks to the CEO, Chief Technology Officer, and other key executives.
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The Board oversees the company's cybersecurity risk management program through the Board's Audit and Finance Committee (the Audit Committee). The Audit Committee is responsible for overseeing and reviewing with management GoDaddy's cybersecurity matters.
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In addition, we monitor third-party sources for notice of cybersecurity incidents that may affect company vendors and other parties with whom we do business. Potential and actual cybersecurity incidents are primarily handled by our internal incident response team, which is supervised by our CISO.
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The Audit Committee consists of Board members with a diversity of expertise in risk management, technology, finance and cybersecurity, including oversight of security teams.
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Management of Cybersecurity Risk GoDaddy management is responsible for identifying, assessing, and managing the company's material cybersecurity risks on an ongoing basis, establishing processes designed to ensure that potential cybersecurity risk exposures are monitored, putting in place appropriate mitigation and remediation measures and maintaining the company's cybersecurity programs. 60 Table of Contents GoDaddy's CISO has primary responsibility for overseeing the company's programs for identifying, assessing, and managing the company's cybersecurity risks.
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The CISO reports directly to the company's CTO and also regularly provides reports and updates to the company's CEO on significant cybersecurity-related matters relevant to the company's cybersecurity risk. The company's CISO has more than 18 years' experience in cybersecurity, networking, and related technologies. The company's CTO has more than 25 years' experience in network security and other related technologies.
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As noted above, the CISO and CTO also provide regular reports to the Audit Committee and the Board. The company's cybersecurity policies, procedures, and strategies primarily are implemented by the company's information security department, which reports directly to the CISO.
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The company's information security department performs functions that include but are not limited to general security operations, event monitoring, incident response, vulnerability management, policy and procedure development, security compliance, product development support, product security readiness testing, third-party vendor security assessments, and penetration testing.
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In particular, we host a substantial portion of our IT infrastructure and data on services maintained by Amazon Web Services.
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We also rely on third parties to provide hardware, software, and services relating to our cybersecurity program. We apply similar controls to third-party providers of cybersecurity services that we apply to other IT hardware, software, and services described above.
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Additionally, any contractual protections with such third parties, 61 Table of Contents including our right to indemnification, if any at all, may be limited or insufficient to prevent a negative impact on our business from such compromise or failure.
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In the event of a potentially material cybersecurity incident, we have defined processes for escalating the incident for determination of whether the incident is material and requires filing of a notification on Form 8-K or other notification required under applicable laws and regulations.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe provide our cloud-based products via a network of data centers including (i) an approximately 320,000 square foot data center we own and operate in Phoenix, Arizona; (ii) co-location data centers located throughout the U.S., most significantly in Virginia; and (iii) co-location international data centers, most significantly in France, Germany, the Netherlands and Singapore.
Biggest changeWe provide our cloud-based products via a network of data centers including (i) a data center we own and operate in Phoenix, Arizona; (ii) co-location data centers located throughout the U.S., most significantly in Virginia; and (iii) co-location international data centers, most significantly in France, Germany, the Netherlands and Singapore. Our data center leases expire on various dates through 2028.
Item 2. Properties. Our corporate headquarters, which we lease, is located in Tempe, Arizona. We lease additional customer care centers and offices located throughout the U.S. as well as internationally, most significantly in Bulgaria, Germany, Romania, Serbia and the UK.
Item 2. Properties. Our corporate headquarters, which we lease, are located in Tempe, Arizona. We lease customer care centers and offices located throughout the U.S. as well as internationally, most significantly in Bulgaria, Germany, Romania, Serbia and the UK.
Our data center leases expire on various dates through 2033. We believe our existing facilities are sufficient for our current needs. Although we have recently closed or consolidated certain of our facilities, in the future, we may need to add new facilities or expand our existing facilities to meet our evolving business needs.
We believe our existing facilities are sufficient for our current needs. Although we have recently closed or consolidated certain of our facilities, in the future, we may need to add new facilities or expand our existing facilities to meet our evolving business needs.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeThe complaint asserts claims of breach of fiduciary duty and corporate waste relating to the approval of the TRA Settlement Agreements (defined above) described in the section titled "Risk Factors" above.
Biggest changeThe complaint asserts claims of breach of fiduciary duty and 55 Table of Contents corporate waste relating to the approval of certain settlement and release agreements we entered into with respect to certain Tax Receivable Agreements (TRAs) entered into with our pre-IPO owners.
The complaint seeks awards of monetary damages and restitution from the defendants on behalf of the company, an order directing the company to implement changes to its corporate governance and internal procedures, and an award of attorneys’ fees and costs. Plaintiff filed an amended complaint in lieu of opposing the company's initial motion on November 4, 2022.
The complaint seeks monetary damages and restitution from the defendants on behalf of the company, an order directing the company to implement changes to its corporate governance and internal procedures, and an award of attorneys’ fees and costs. The Plaintiff filed an amended complaint in lieu of opposing the company's initial motion on November 4, 2022.
On September 21, 2023, the company's Board of Directors resolved to form a Special Litigation Committee (the SLC) that is vested with the full authority of the Board to take any such action with respect to this litigation that the SLC in its sole discretion deems to be in the best interests of the company.
On September 21, 2023, the company's board of directors resolved to form a Special Litigation Committee (the SLC) vested with the full authority of the board of directors, to take any such action with respect to the litigation that the SLC, in its sole discretion, deems to be in the best interests of the company.
Although the results of any such current or future Proceedings, regardless of the underlying nature of the 62 Table of Contents claims or facts, cannot be predicted with certainty, the final outcome of any current or future Proceedings we face could adversely affect our business, financial condition and results of operations.
Although the results of any such current or future Proceedings, regardless of the underlying nature of the claims or facts, cannot be predicted with certainty, the final outcome of any current or future Proceedings we face could adversely affect our business, financial condition and results of operations.
Mine Safety Disclosures Not applicable. 63 Table of Contents Part II.
Mine Safety Disclosures Not applicable. 56 Table of Contents Part II.
The matter is currently stayed pending the SLC's investigation of the allegations. Other information regarding our legal proceedings required by this item is provided in Note 13 to our financial statements and is incorporated herein by reference.
Other information regarding our legal proceedings required by this item is provided in Note 13 to our financial statements and is incorporated herein by reference.
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The SLC completed its investigation and concluded, in the exercise of its business judgment, that dismissal of the action with prejudice would be in the best interests of the company and its shareholders. On December 13, 2024, the SLC moved to terminate the action. The motion is pending further proceedings before the court.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

3 edited+1 added−4 removed4 unchanged
Biggest changeSee "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources." Share Repurchases Our board of directors has authorized the share repurchase programs described in Note 5 to our financial statements.
Biggest changeOur ability to pay dividends is also limited by the covenants of our existing indebtedness. See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources." 57 Table of Contents Share Repurchases Our board of directors has authorized the share repurchase programs described in Note 5 to our financial statements.
The following graph compares, for the five year period ending December 31, 2023, the cumulative total return to stockholders on our Class A common stock relative to the cumulative total returns of the Standard & Poor's 500 Index (S&P 500) and the NASDAQ Internet Index.
The following graph compares, for the five year period ending December 31, 2024, the cumulative total return to stockholders on our Class A common stock relative to the cumulative total returns of the Standard & Poor's 500 Index (S&P 500) and the NASDAQ Internet Index.
"Risk Factors." Holders of Record As of December 31, 2023, there were 20 holders of record of our Class A common stock, although we believe there are a significantly larger number of beneficial owners because many shares are held by brokers and other institutions on behalf of stockholders.
"Risk Factors." Holders of Record As of December 31, 2024, there were 16 holders of record of our Class A common stock, although we believe there are a significantly larger number of beneficial owners because many shares are held by brokers and other institutions on behalf of stockholders.
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Each of our subsidiaries is a distinct legal entity and may be subject to legal or contractual restrictions limiting their ability to make distributions to us.
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There was no share repurchase activity during the three months ended December 31, 2024 pursuant to our share repurchase programs. Item 6. [Reserved]
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For example, Desert Newco is generally prohibited under Delaware law from making a distribution to us to the extent that, at the time of the distribution, after giving effect to the 64 Table of Contents distribution, liabilities of Desert Newco (with certain exceptions) exceed the fair value of its assets.
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Desert Newco's subsidiaries are generally subject to similar legal limitations on their ability to make distributions to Desert Newco. Our ability to pay dividends is also limited by the covenants of our existing indebtedness.
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Share repurchase activity during the three months ended December 31, 2023 pursuant to our share repurchase programs was as follows: Period Total Number of Shares Purchased (in thousands) Average Price Paid Per Share Total Number of Shares Purchased as Part of Publicly Announced Programs (in thousands) Approximate Dollar Value of Shares that May Yet be Purchased under the Programs (in millions) October 1 - October 31 1,601 $ 73.66 1,601 November 1 - November 30 16 $ 73.19 16 December 1 - December 31 — — Total 1,617 1,617 $ 1,435.5 Item 6. [Reserved]

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

71 edited+37 added−50 removed29 unchanged
Biggest changeYear Ended December 31, 2023 2022 2021 $ % of Total Revenue $ % of Total Revenue $ % of Total Revenue Revenue: A&C $ 1,430.4 33.6 % $ 1,279.7 31.3 % $ 1,128.3 29.6 % Core 2,823.7 66.4 % 2,811.6 68.7 % 2,687.4 70.4 % Total revenue 4,254.1 100.0 % 4,091.3 100.0 % 3,815.7 100.0 % Costs and operating expenses: Cost of revenue (excluding depreciation and amortization) 1,573.6 37.0 % 1,484.5 36.3 % 1,372.2 36.0 % Technology and development 839.6 19.7 % 794.0 19.4 % 706.3 18.5 % Marketing and advertising 352.9 8.3 % 412.3 10.1 % 503.9 13.2 % Customer care 304.5 7.2 % 305.9 7.5 % 306.1 8.0 % General and administrative 374.0 8.9 % 385.5 9.4 % 345.8 9.1 % Restructuring and other 90.8 2.1 % 15.7 0.4 % (0.3) — % Depreciation and amortization 171.3 3.9 % 194.6 4.7 % 199.6 5.2 % Total costs and operating expenses 3,706.7 87.1 % 3,592.5 87.8 % 3,433.6 90.0 % Operating income 547.4 12.9 % 498.8 12.2 % 382.1 10.0 % Interest expense (179.0) (4.2) % (146.3) (3.6) % (126.0) (3.3) % Loss on debt extinguishment (1.5) — % (3.6) (0.1) % — — % Other income (expense), net 36.9 0.8 % 7.6 0.2 % (2.5) (0.1) % Income before income taxes 403.8 9.5 % 356.5 8.7 % 253.6 6.6 % Benefit (provision) for income taxes 971.8 22.8 % (3.6) (0.1) % (10.8) (0.3) % Net income 1,375.6 32.3 % 352.9 8.6 % 242.8 6.3 % Less: net income attributable to non-controlling interests 0.8 — % 0.7 — % 0.5 — % Net income attributable to GoDaddy Inc. $ 1,374.8 32.3 % $ 352.2 8.6 % $ 242.3 6.3 % 67 Table of Contents Non-GAAP Financial Measure and Other Operating Metrics In addition to our results determined in accordance with GAAP, we believe that Normalized EBITDA, a non-GAAP financial measure, and the following other operating metrics are useful as supplements in evaluating our ongoing operational performance and help provide an enhanced understanding of our business: Year Ended December 31, 2023 2022 2021 Normalized EBITDA $ 1,134.5 $ 1,013.0 $ 872.2 Annualized recurring revenue $ 3,729.3 $ 3,570.1 $ 3,433.7 Total bookings $ 4,603.1 $ 4,413.8 $ 4,231.7 Total customers at period end (in thousands) 21,026 20,897 20,701 Average revenue per user $ 203 $ 197 $ 187 Normalized EBITDA (NEBITDA).
Biggest changeYear Ended December 31, 2024 2023 2022 $ % of Total Revenue $ % of Total Revenue $ % of Total Revenue Revenue: A&C $ 1,653.0 36.1 % $ 1,430.4 33.6 % $ 1,279.7 31.3 % Core 2,920.2 63.9 % 2,823.7 66.4 % 2,811.6 68.7 % Total revenue 4,573.2 100.0 % 4,254.1 100.0 % 4,091.3 100.0 % Costs and operating expenses: Cost of revenue (excluding depreciation and amortization) 1,652.0 36.1 % 1,573.6 37.0 % 1,484.5 36.3 % Technology and development 814.4 17.8 % 839.6 19.7 % 794.0 19.4 % Marketing and advertising 356.9 7.8 % 352.9 8.3 % 412.3 10.1 % Customer care 287.5 6.3 % 304.5 7.2 % 305.9 7.5 % General and administrative 394.2 8.6 % 374.0 8.9 % 385.5 9.4 % Restructuring and other 39.4 0.9 % 90.8 2.1 % 15.7 0.4 % Depreciation and amortization 135.3 3.0 % 171.3 3.9 % 194.6 4.7 % Total costs and operating expenses 3,679.7 80.5 % 3,706.7 87.1 % 3,592.5 87.8 % Operating income 893.5 19.5 % 547.4 12.9 % 498.8 12.2 % Interest expense (158.3) (3.5) % (179.0) (4.2) % (146.3) (3.6) % Loss on debt extinguishment (4.6) (0.1) % (1.5) — % (3.6) (0.1) % Other income (expense), net 34.8 0.8 % 36.9 0.8 % 7.6 0.2 % Income before income taxes 765.4 16.7 % 403.8 9.5 % 356.5 8.7 % Benefit (provision) for income taxes 171.5 3.8 % 971.8 22.8 % (3.6) (0.1) % Net income 936.9 20.5 % 1,375.6 32.3 % 352.9 8.6 % Less: net income attributable to non-controlling interests — — % 0.8 — % 0.7 — % Net income attributable to GoDaddy Inc. $ 936.9 20.5 % $ 1,374.8 32.3 % $ 352.2 8.6 % Non-GAAP Financial Measures, Operating Metrics and Business Metrics In addition to our results determined in accordance with GAAP, we believe that the following non-GAAP financial measures, operating metrics and business metrics may be useful as supplements in evaluating our ongoing operational performance: Year Ended December 31, 2024 2023 2022 Normalized EBITDA $ 1,395.9 $ 1,134.5 $ 1,013.0 Annualized recurring revenue $ 4,042.6 $ 3,729.3 $ 3,570.1 Total bookings $ 5,038.8 $ 4,603.1 $ 4,413.8 Total customers at period end (in thousands) 20,511 21,026 20,897 ARPU $ 220 $ 203 $ 197 Domains under management (in thousands) 81,013 83,554 83,857 60 Table of Contents Normalized EBITDA (NEBITDA).
However, our future capital requirements will depend on many factors, including our growth rate, macroeconomic activity, the timing and extent of spending to support domestic and international development efforts, continued brand development and advertising spend, the level of customer care and general and administrative activities, the introduction of new and enhanced product offerings, the costs to support new and replacement capital equipment, the completion of strategic acquisitions or share repurchases and other factors.
However, our future capital requirements will depend on many factors, including our growth rate, macroeconomic activity, the timing and extent of spending to support domestic and international development efforts, continued brand development and advertising spend, the level of customer care and general and administrative activities, the introduction of new and enhanced product offerings, the costs to support new and replacement capital equipment, the completion of strategic acquisitions or share repurchases.
NEBITDA is a supplemental measure of our operating performance used by management and investors to evaluate our business. We calculate NEBITDA as net income excluding depreciation and amortization, interest expense (net), provision or benefit for income taxes, equity-based compensation expense, acquisition-related costs, restructuring-related expenses and certain other items.
NEBITDA is a supplemental measure of our operating performance used by management to evaluate our business. We calculate NEBITDA as net income excluding depreciation and amortization, interest expense (net), provision or benefit for income taxes, equity-based compensation expense, acquisition-related costs, restructuring-related expenses and certain other items.
The assumptions utilized in determining future taxable income require significant judgment and are consistent with the plans and estimates we use to manage our business. Actual operating results in future years could differ from our current assumptions, judgments and estimates, which could have a material impact on the amount of DTAs we ultimately realize.
The assumptions utilized in determining future taxable income require judgment and are consistent with the plans and estimates we use to manage our business. Actual operating results in future years could differ from our current assumptions, judgments and estimates, which could have a material impact on the amount of DTAs we ultimately realize.
We assess our goodwill and indefinite-lived intangible assets for impairment at least annually during the fourth quarter. We will also perform an assessment at other times if and when events or changes in circumstances indicate the carrying value of these assets may not be recoverable.
We assess our indefinite-lived intangible assets for impairment at least annually during the fourth quarter. We will also perform an assessment at other times if and when events or changes in circumstances indicate the carrying value of these assets may not be recoverable.
Investing Activities Our investing activities generally consist of strategic acquisitions and purchases of property and equipment to support the overall growth of our business. We expect our investing cash flows to be affected by the timing of payments we make for capital expenditures, strategic acquisitions or other growth opportunities we decide to pursue.
Investing Activities Our investing activities generally consist of strategic acquisitions, dispositions and purchases of property and equipment to support the overall growth of our business. We expect our investing cash flows to be affected by the timing of payments we make for capital expenditures, strategic acquisitions or other growth opportunities we decide to pursue.
Different assumptions and judgments would change the estimates used in the preparation of our financial statements, which, in turn, could change our results from those reported. We refer to estimates, assumptions and judgments of this type as our critical accounting policies and estimates, which we discuss further below.
Different assumptions and judgments could change the estimates used in the preparation of our financial statements, which, in turn, could change our results from those reported. We refer to estimates, assumptions and judgments of this type as our critical accounting policies and estimates, which we discuss further below.
See Note 10 to our financial statements for additional discussion. Loss on debt extinguishment In 2023, we recognized a loss on debt extinguishment of $1.5 million, primarily related to the refinancing of the 2029 Term Loans. See Note 10 to our financial statements for additional discussion.
In 2023, we recognized a loss on debt extinguishment of $1.5 million related to the refinancing of the 2029 Term Loans. See Note 10 to our financial statements for additional discussion.
We believe that the inclusion or exclusion of certain recurring and non-recurring items provides a supplementary measure of our core operating results and permits useful alternative period-over-period comparisons of our operations but should not be viewed as a substitute for comparable GAAP measures. Annualized recurring revenue (ARR).
We believe that the inclusion or exclusion of certain recurring and non-recurring items provides a supplementary measure of our core operating results and permits useful alternative period-over-period comparisons of our operations. NEBITDA should not be viewed as a substitute for comparable GAAP measures. Annualized recurring revenue (ARR).
Similar to our billing practices, we pay domain costs at the time of purchase for the life of each subscription but recognize the costs of service ratably over the term of our customer contracts. The terms for domain costs are established by agreements between registries and registrars and can vary significantly depending on the TLD.
Similar to our billing practices, we pay domain costs at the time of purchase for the life of each subscription but recognize the costs of service ratably over the term of our customer contracts. The terms for domain costs are established by agreements between registries and registrars and can vary significantly depending on the top-level domain (TLD).
As a result of many factors, such as those set forth in "Risk Factors," actual results may differ materially from the results described in, or implied by, these forward-looking statements. This section generally discusses 2023 and 2022 items and year-to-year comparisons between 2023 and 2022.
As a result of many factors, such as those set forth in "Risk Factors," actual results may differ materially from the results described in, or implied by, these forward-looking statements. This section generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
Discussion of 2021 items and comparisons between 2022 and 2021 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K for the year ended December 31, 2022.
Discussion of 2022 items and comparisons between 2023 and 2022 that are not included in this Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Form 10-K for the year ended December 31, 2023.
We expect technology and development expense to decrease as a percentage of revenue in future periods following a period of investment in product development and migration toward a unified infrastructure platform.
We expect technology and development expenses to decrease as a percentage of revenue in future periods following a period of investment in product development and migration toward a unified infrastructure platform.
General and administrative General and administrative expenses primarily consist of personnel costs for our administrative functions, professional service fees, office rent for all locations, all employee travel expenses, acquisition-related expenses and other general costs.
General and administrative General and administrative expenses primarily consist of personnel costs for our administrative functions, professional service fees, office rent for all locations, acquisition-related expenses and other general costs.
(1) Discussion of constant currency is set forth in "Quantitative and Qualitative Disclosures about Market Risk." (2) Our operating results for the year ended December 31, 2023 included $90.8 million in restructuring and other charges, as further discussed in Note 14 to our financial statements.
(1) Discussion of constant currency is set forth in "Quantitative and Qualitative Disclosures about Market Risk." (2) Our operating results for the year ended December 31, 2024 and December 31, 2023 included $39.4 million and $90.8 million, respectively, in restructuring and other charges, as further discussed in Note 14 to our financial statements.
Revenue associated with sales of aftermarket domains and third party solutions, including Microsoft 365, where we act as a reseller of products provided by others is generally recorded on a gross basis as we have determined that we control the product before transferring it to our end customers.
Revenue associated with sales of certain third party solutions, including Microsoft 365, where we act as a reseller of products provided by others is recorded on a gross basis as we have determined that we control the product before transferring it to our end customers.
We expect cost of revenue to increase in absolute dollars in future periods due to increased sales of domains and third-party productivity applications as well as continued growth in our customer base. However, cost of revenue may fluctuate as a percentage of total revenue, depending on the mix of products sold in a particular period.
We expect cost of revenue to increase in absolute dollars in future periods due to increased sales of domains and third-party productivity applications. However, cost of revenue may fluctuate as a percentage of total revenue, depending on the mix of products sold in a particular period.
Technology and development Technology and development expenses represent the costs associated with the creation, development and distribution of our products and websites. These expenses primarily consist of personnel costs associated with the design, development, deployment, testing, operation and enhancement of our products, as well as costs associated with the data centers and systems infrastructure supporting those products, excluding depreciation expense.
These expenses primarily consist of personnel costs associated with the design, development, deployment, testing, operation and enhancement of our products, as well as costs associated with the operation of our data centers and systems infrastructure supporting those products, excluding depreciation expense.
(Throughout the tables and this discussion and analysis, dollars are in millions, excluding average revenue per user (ARPU), and shares are in thousands.) Overview We are a global leader serving a large market of entrepreneurs, developing and delivering easy-to-use products in a one-stop shop solution alongside personalized guidance. We serve small businesses, individuals, organizations, developers, designers and domain investors.
(Throughout the tables and this discussion and analysis, dollars are in millions, excluding average revenue per user (ARPU), and shares are in thousands.) Overview We serve a large market of entrepreneurs, through the development and delivery of easy-to-use products in a one stop shop solution alongside personalized guidance. We serve small businesses, individuals, organizations, developers, designers and domain investors.
ARR is an operating metric defined as quarterly recurring revenue (QRR) multiplied by four. QRR represents the quarterly recurring GAAP revenue, net of refunds, from new and renewed subscription-based services. ARR is exclusive of any revenue that is non-recurring, including, without limitation, domain aftermarket, domain transfers, one-time set-up or migration fees and non-recurring professional website services fees.
ARR is an operating metric defined as annualized quarterly recurring GAAP revenue, net of refunds, from new and renewed subscription-based services. ARR is exclusive of any revenue that is non-recurring, including, without limitation, domain aftermarket, domain transfers, one-time set-up or migration fees and non-recurring professional website services fees.
The determination of gross or net revenue recognition is reviewed on a product-by-product basis. See Notes 2 and 8 to our financial statements for additional information regarding revenue recognition and deferred revenue. Acquisitions We determine whether substantially all of the fair value of assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets.
See Notes 2 and 8 to our financial statements for additional information regarding revenue recognition and deferred revenue. Acquisitions We determine whether substantially all of the fair value of assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets.
Costs and Operating Expenses Cost of revenue Costs of revenue are primarily the direct costs incurred in connection with selling an incremental product to our customers. Substantially all cost of revenue relates to domain registration fees, payment processing fees, third-party commissions and licensing fees for third-party productivity applications.
Costs and Operating Expenses Cost of revenue Cost of revenue primarily represents the direct costs incurred in connection with selling an incremental product to our customers. Such costs primarily relate to domain registration fees, payment processing fees, third-party commissions and licensing fees for third-party productivity applications.
(3) In addition to the restructuring and other charges in our statement of operations, other charges include lease-related expenses associated with closed facilities, charges related to certain legal matters, adjustments to the fair value of our equity investments, expenses incurred in relation to the refinancing of our long-term debt and incremental expenses associated with certain professional services.
(2) In addition to the restructuring and other in our statements of operations, other charges are primarily composed of lease-related expenses associated with closed facilities, charges related to certain legal matters, adjustments to the fair value of our equity investments, expenses incurred in relation to the refinancing of our long-term debt, and incremental expenses associated with certain professional services.
These expenses also include personnel costs and affiliate program commissions. We expect marketing and advertising expenses to fluctuate depending on both the mix of internal and external marketing resources used, the size and scope of our future campaigns and the level of discretionary investments we make in marketing to drive future sales.
We expect marketing and advertising expenses to fluctuate depending on both the mix of internal and external marketing resources used, the size and scope of our future campaigns and the level of discretionary investments we make in marketing to drive future sales.
We continue to collect information and reevaluate our preliminary estimates and assumptions and record any qualifying measurement period adjustments to goodwill. Contingent consideration is adjusted to fair value in subsequent periods as an increase or decrease in general and administrative expenses. 76 Table of Contents See Notes 2 and 3 to our financial statements for additional information regarding business acquisitions.
We continue to collect information and reevaluate our preliminary estimates and assumptions and record any qualifying measurement period adjustments to goodwill. Contingent consideration is adjusted to fair value in subsequent periods as an increase or decrease in general and administrative expenses.
As of December 31, 2023, we were in compliance with all such covenants and had no amounts drawn on our revolving credit facility. As discussed in Note 11 to our financial statements, we have hedged a portion of our long-term debt through the use of cross-currency and interest rate swap derivative instruments.
As of December 31, 2024, we were in compliance with all such covenants and had $998.7 million available for borrowing under the Revolver. As discussed in Note 11 to our financial statements, we have hedged a portion of our long-term debt through the use of cross-currency and interest rate swap derivative instruments.
Income Taxes We are subject to U.S. federal, state and foreign income taxes with respect to our allocable share of any taxable income or loss of Desert Newco, as well as any stand-alone income or loss we generate. Significant judgment is required in determining our provision or benefit for income taxes and in evaluating uncertain tax positions.
Income Taxes We are subject to U.S. federal, state and foreign income taxes with respect to our allocable share of any taxable income or loss of Desert Newco, as well as any stand-alone income or loss we generate.
Financing Activities Our financing activities generally consist of long-term debt borrowings, the repayment of principal on long-term debt, stock option exercise proceeds, ESPP proceeds, payment of certain acquisition-related obligations and share repurchases.
Financing Activities Our financing activities generally consist of long-term debt borrowings, the repayment of principal on long-term debt, stock option exercises, Employee Stock Purchase Plan (ESPP) proceeds and share repurchases.
Total customers is one way we measure the scale of our business and is an important part of our ability to increase our revenue base. Average revenue per user . We calculate ARPU as total revenue during the preceding 12 month period divided by the average of the number of total customers at the beginning and end of the period.
Average revenue per user (ARPU) . We calculate ARPU as total revenue during the preceding 12 month period divided by the average of the number of total customers at the beginning and end of the period. ARPU is one measure that provides insight into our ability to sell additional products to our customers.
Restructuring and other Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Restructuring and other $ 90.8 $ 15.7 $ (0.3) $ 75.1 478 % $ 16.0 (5333) % Restructuring and other of $90.8 million during 2023 primarily includes costs incurred pursuant to restructuring activities in the first and third quarters of 2023, as further discussed in Note 14 to our financial statements, as well as a charge of $17.0 million related to the termination of a revenue sharing agreement.
Restructuring and other of $90.8 million during 2023 primarily includes costs incurred pursuant to restructuring activities as further discussed in Note 14 to our financial statements, as well as a charge of $17.0 million related to the termination of a revenue sharing agreement.
Goodwill and Indefinite-Lived Intangible Assets We make estimates, assumptions and judgments when valuing goodwill and other intangible assets in connection with the initial purchase price allocations of business acquisitions, as well as when evaluating the recoverability of our goodwill and other intangible assets on an ongoing basis.
See Notes 2 and 3 to our financial statements for additional information regarding business acquisitions. 69 Table of Contents Indefinite-Lived Intangible Assets We make estimates, assumptions and judgments when valuing indefinite-lived intangible assets in connection with the initial purchase price allocations of business acquisitions, as well as when evaluating the recoverability of our indefinite-lived intangible assets on an ongoing basis.
Our chief operating decision maker evaluates segment performance based upon several factors, of which the primary financial measures are revenue and Segment EBITDA, our segment measure of profitability.
Segment Results of Operations Our two operating segments, A&C and Core, reflect the way we manage and evaluate the performance of our business. Our chief operating decision maker evaluates segment performance based upon several factors, of which the primary financial measures are revenue and Segment EBITDA, our segment measure of profitability.
ARPU provides insight into our ability to sell additional products to customers, though the impact to date has been muted due to our continued growth in total customers. 68 Table of Contents Reconciliation of NEBITDA The following table reconciles NEBITDA to net income, its most directly comparable GAAP financial measure: Year Ended December 31, 2023 2022 2021 Net income $ 1,375.6 $ 352.9 $ 242.8 Depreciation and amortization 171.3 194.6 199.6 Equity-based compensation (1) 294.0 264.4 207.9 Interest expense, net 155.4 135.0 124.9 Acquisition-related expenses (2) 12.1 35.1 78.2 Restructuring and other (3) 97.9 27.4 8.0 Provision (benefit) for income taxes (971.8) 3.6 10.8 NEBITDA $ 1,134.5 $ 1,013.0 $ 872.2 _________________________________ (1) The year ended December 31, 2023 excludes $2.3 million of equity-based compensation expense associated with our restructuring plan, which is included within restructuring and other.
Reconciliation of NEBITDA The following table reconciles NEBITDA to net income, its most directly comparable GAAP financial measure: Year Ended December 31, 2024 2023 2022 Net income $ 936.9 $ 1,375.6 $ 352.9 Depreciation and amortization 135.3 171.3 194.6 Equity-based compensation expense (1) 299.1 294.0 264.4 Interest expense, net of interest income 130.4 155.4 135.0 Acquisition-related expenses, net of reimbursements 0.2 12.1 35.1 Restructuring and other (2) 65.5 97.9 27.4 Provision (benefit) for income taxes (171.5) (971.8) 3.6 NEBITDA $ 1,395.9 $ 1,134.5 $ 1,013.0 _________________________________ (1) The year ended December 31, 2024 and 2023 excludes $0.8 million and $2.3 million, respectively, of equity-based compensation expense associated with our restructuring activities, which is included within restructuring and other.
The 11.8% increase in A&C revenue was primarily driven by: (i) 11.2% growth in revenue related to our productivity applications, most notably our email solutions; (ii) 8.2% growth in revenue due to continued customer adoption of our subscription-based products designed to establish and grow online presence; and (iii) 54.0% growth in revenue related to our commerce solutions, as continued customer adoption has resulted in an increase in payment volume.
The 15.6% increase in A&C revenue for the year ended December 31, 2024 was driven by: (i) 20.3% growth in revenue related to our productivity applications, most notably from our pricing and bundling initiatives; (ii) 8.7% growth in revenues due to continued customer adoption of our subscription-based products designed to establish and grow an online presence; and (iii) 40.1% growth in revenue related to our commerce solutions, as continued customer adoption has resulted in an increase in payment volume.
The following table presents our revenue for the periods indicated: Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Applications & commerce $ 1,430.4 $ 1,279.7 $ 1,128.3 $ 150.7 12 % $ 151.4 13 % Core platform $ 2,823.7 $ 2,811.6 $ 2,687.4 $ 12.1 0 % $ 124.2 5 % Total revenue $ 4,254.1 $ 4,091.3 $ 3,815.7 $ 162.8 4 % $ 275.6 7 % Total revenue increased 4.0%, due to the increases in our A&C and Core revenues, as described below: A&C.
Revenue is presented net of refunds, and we maintain a reserve to provide for refunds granted to customers. 61 Table of Contents The following table presents our revenue for the periods indicated: Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Applications and commerce $ 1,653.0 $ 1,430.4 $ 1,279.7 $ 222.6 16 % $ 150.7 12 % Core platform 2,920.2 2,823.7 2,811.6 96.5 3 % 12.1 0 % Total revenue $ 4,573.2 $ 4,254.1 $ 4,091.3 $ 319.1 8 % $ 162.8 4 % Total revenue increased 7.5%, due to the increases in our A&C and Core revenues, as described below: A&C .
Net income for the year ended December 31, 2023 included a $971.8 million benefit for income taxes primarily due to a $1,014.0 million release of the majority of our domestic valuation allowance . (3) A reconciliation of Normalized EBITDA to net income, its most directly comparable GAAP financial measure, is set forth in "Reconciliation of NEBITDA" below.
Net income for the year ended December 31, 2023 included a $971.8 million benefit for income taxes primarily due to a $1,014.0 million release of the majority of our domestic valuation allowance .
In general, we seek to deploy our capital in a prioritized manner fo cusing first on requirements for our operations, then on growth investments, and finally on stockholder returns.
In general, we seek to deploy our capital by focusing on requirements for our operations, on growth investments and on stockholder returns.
We believe the breadth and depth of our product offerings and the high quality and responsiveness of our customer care team build strong relationships with our customers and are key to our high level of customer retention. We generate bookings and revenue from sales of product subscriptions.
We believe the breadth and depth of our solutions, the intelligent and proactive AI-powered experiences and the high quality and responsiveness of our customer care team builds strong relationships with our customers and are key to our high level of customer retention.
Accordingly, we believe total bookings is an indicator of the expected growth in our revenue and is a supplemental measure of the operating performance of our business. Applications and Commerce . We generated 33.6% of our 2023 total revenue from the sale of A&C products.
In addition, we monitor total bookings as we believe it is an indicator of the expected growth in our revenue and is a supplemental measure of the operating performance of our business.
In addition, we made a cash payment of $17.0 million related to the termination of a revenue sharing agreement during 2023. 74 Table of Contents Cash Flows The following table summarizes our cash flows for the periods indicated: Year Ended December 31, 2023 2022 2021 Net cash provided by operating activities $ 1,047.6 $ 979.7 $ 829.3 Net cash used in investing activities (102.4) (132.0) (635.6) Net cash provided by (used in) financing activities (1,261.7) (1,326.7) 298.1 Effect of exchange rate changes on cash and cash equivalents 1.3 (2.7) (1.3) Net increase (decrease) in cash and cash equivalents $ (315.2) $ (481.7) $ 490.5 Operating Activities Our primary source of cash from operating activities has been cash collections from our customers.
Should we pursue additional strategic acquisitions or share repurchases, we may need to raise additional capital, which may be in the form of long-term debt or equity financings. 66 Table of Contents Cash Flows The following table summarizes our cash flows for the periods indicated: Year Ended December 31, 2024 2023 2022 Net cash provided by operating activities $ 1,287.7 $ 1,047.6 $ 979.7 Net cash provided by (used in) investing activities 21.5 (102.4) (132.0) Net cash used in financing activities (677.4) (1,261.7) (1,326.7) Effect of exchange rate changes on cash and cash equivalents (1.6) 1.3 (2.7) Net increase (decrease) in cash and cash equivalents $ 630.2 $ (315.2) $ (481.7) Operating Activities Our primary source of cash from operating activities has been cash collections from our customers.
Off-Balance Sheet Arrangements As of December 31, 2023 and 2022, we had no off-balance sheet arrangements that had, or which are reasonably likely to have, a material effect on our financial statements. 75 Table of Contents Critical Accounting Policies and Estimates We prepare our financial statements in accordance with GAAP, and in doing so, we make estimates, assumptions and judgments affecting the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities.
Critical Accounting Policies and Estimates We prepare our financial statements in accordance with GAAP, and in doing so, we make estimates, assumptions and judgments affecting the reported amounts of assets, liabilities, revenues and expenses, as well as the related disclosure of contingent assets and liabilities.
To track our growth and the stability of our customer base, we monitor, among other things, revenue and retention rates generated by our annual customer cohorts over time, as well as corresponding marketing and advertising spend. We define an annual customer cohort to include each customer who first became a customer during a calendar year.
To that end, we continue to monitor our customer cohorts to ensure growth and stability of our customer base. We track revenue and retention rates generated by our annual customer cohorts over time, as well as corresponding marketing and advertising spend.
We expect cash outflows from operating activities to be affected by the timing of payments we make to registries as well as increases in personnel and other operating costs as we continue to grow our business.
We expect cash outflows from operating activities to be affected by the timing of payments we make to registries and other operating costs as we continue to grow our business. Net cash provided by operating activities increased $240.1 million from $1,047.6 million in 2023 to $1,287.7 million in 2024, primarily driven by the growth in total bookings.
We manage and report our business in the following two segments: • Applications and Commerce (A&C) , which primarily consists of sales of products containing proprietary software, notably our website building products, as well as our commerce products and third-party email and productivity solutions and sales of certain products when they are included in bundled offerings of our proprietary software products. • Core Platform (Core) , which primarily consists of sales of domain registrations and renewals, aftermarket domain sales, website hosting products and website security products when not included in bundled offerings of our proprietary software products as well as sales of products not containing a software component. 65 Table of Contents Financial Highlights Below are our key consolidated financial highlights for 2023, with comparisons to 2022. • Total revenue of $4,254.1 million, an increase of 4.0%, or approximately 4.6% on a constant currency basis (1) . • International revenue of $1,381.1 million, an increase of 3.5%, or approximately 5.3% on a constant currency basis (1) . • Total bookings of $4,603.1 million, an increase of 4.3%, or approximately 4.7% on a constant currency basis (1) . • Operating income of $547.4 million, an increase of 9.7%.
We manage and report our business in the following two segments: • Applications and Commerce (A&C) , which primarily consists of sales of products containing proprietary software, notably our website building products, as well as our proprietary commerce solutions and third-party email and productivity solutions and sales of certain products when they are included in bundled offerings of our proprietary software products. • Core Platform (Core) , which primarily consists of sales of domain registrations and renewals, aftermarket domain sales, domain protection, website hosting products and website security products when not included in bundled offerings of our proprietary software products as well as sales of products not containing a software component.
Share Repurchases As discussed in Note 5 to our financial statements, we are authorized to repurchase up to $4,000.0 million of our Class A common stock. During the year ended December 31, 2023, we repurchased a total of 17,356 shares of our Class A common stock in the open market for an aggregate purchase price of $1,264.4 million.
Share Repurchases As discussed in Note 5 to our financial statements, we are authorized to repurchase up to $4,000.0 million of our Class A common stock.
Benefit (provision) for income taxes During 2023, we released a majority of our domestic valuation allowance on a portion of our deferred tax assets resulting in a $1,014.0 million non-cash income tax benefit, as discussed in Note 16 to our financial statements.
During 2023, we released a majority of our domestic valuation allowance on a portion of our deferred tax assets resulting in a $1,014.0 million non-cash income tax benefit. This release was related to our U.S. federal and state domestic NOLs, credit carryforwards and other deferred tax assets (DTAs).
In each of the five years ended December 31, 2023, our customer retention rate was approximately 85%, and in 2023, our retention rate for customers who had been with us for over three years was approximately 92%.
For the year ended December 31, 2024, customer retention for customers within the GoDaddy platform, which represents the vast majority of our customers, was approximately 87%. In addition, the retention rate for our customers who had been with us for over three years as of December 31, 2024 was approximately 90%.
Restructuring and other of $15.7 million during 2022 primarily includes the impairment and loss on disposition of certain assets. 71 Table of Contents Depreciation and amortization Depreciation and amortization expenses consist of charges relating to the depreciation of the property and equipment used in our operations and the amortization of acquired intangible assets.
Depreciation and amortization Depreciation and amortization expenses consist of charges relating to the depreciation of the property and equipment used in our operations and the amortization of acquired intangible assets.
See Notes 2 and 16 to our financial statements for additional information regarding income taxes and the release of the majority of the domestic valuation allowance against our DTAs.
See Notes 2 and 16 to our financial statements for additional information regarding income taxes. Recent Accounting Pronouncements For information regarding recent accounting pronouncements, see Note 2 to our financial statements. 70 Table of Contents
(2) • Net income of $1,375.6 million, an increase of 289.8%. (2) • Normalized EBITDA (3) of $1,134.5 million, an increase of 12.0%. • Net cash provided by operating activities of $1,047.6 million, an increase of 6.9%.
(2) • Net income of $936.9 million, a decrease of 31.9%. (2) • Normalized EBITDA (3) of $1,395.9 million, an increase of 23.0%. • Net cash provided by operating activities of $1,287.7 million, an increase of 22.9%.
Cash payments of $38.7 million related to restructuring activities were made during 2023, with approximately $7.4 million remaining to be paid in 2024. We expect to make substantially all remaining restructuring payments pursuant to these activities by the end of the second quarter of 2024.
We expect to make substantially all remaining restructuring payments pursuant to these activities by the end of the second quarter of 2025.
If, based on our qualitative analysis, we were to determine it is more-likely-than-not the fair value of either of our reporting units is less than its carrying amount, a quantitative impairment test would be performed to determine if an impairment loss should be recorded. Our qualitative analyses during 2023, 2022 and 2021 did not indicate any impairment.
If, based on our qualitative analysis, we were to determine it is more-likely-than-not that the indefinite-lived intangible asset is impaired, a quantitative impairment test would be performed to determine if an impairment loss should be recorded. Our qualitative assessment during 2024 indicated it was more-likely-than-not that certain indefinite-lived intangible assets were impaired.
Interest expense Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Interest expense $ 179.0 $ 146.3 $ 126.0 $ 32.7 22 % $ 20.3 16 % The 22.4% increase in interest expense was primarily driven by the higher effective interest rates on the unhedged portion of our variable-rate debt partially offset by the refinancing of the 2029 Term Loans which reduced our interest margin.
Interest expense Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Interest expense $ 158.3 $ 179.0 $ 146.3 $ (20.7) (12) % $ 32.7 22 % The 11.6% decrease in interest expense for the year ended December 31, 2024 was attributable to the refinancing of the 2029 Term Loans in July 2023, January 2024 and December 2024 and the 2031 Term Loans in May 2024, each of which reduced our interest margin.
Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Depreciation and amortization $ 171.3 $ 194.6 $ 199.6 $ (23.3) (12) % $ (5.0) (3) % The $23.3 million decrease in depreciation and amortization expenses was primarily due to technology and customer-related intangible asset dispositions in conjunction with the restructuring activities in 2023 and certain acquired intangibles reaching the end of their useful lives.
Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Depreciation and amortization $ 135.3 $ 171.3 $ 194.6 $ (36.0) (21) % $ (23.3) (12) % The 21.0% decrease for the year ended December 31, 2024 was attributable to a $26.4 million decrease in amortization of acquired intangible assets driven by certain intangible assets reaching the end of their useful life and an $8.1 million decrease in depreciation primarily due to property and equipment being fully depreciated or disposed of during the period.
See Note 10 to our financial statements for additional information regarding our long-term debt. In January 2024, we entered into an amendment to the Credit Facility to refinance the 2029 Term Loans, as discussed in Note 20 to our financial statements.
See Note 10 to our financial statements for additional information regarding our long-term debt.
The 0.4% increase in Core revenue was primarily driven by 4.1% growth in domain-related revenues and the continued growth of our registry business, partially offset by a 7.8% decrease in hosting revenues primarily due to end-of-life migrations from certain products, and the divestiture of certain hosting assets during the year. 69 Table of Contents Bookings The following table presents our total bookings for the periods indicated: Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Total bookings $ 4,603.1 $ 4,413.8 $ 4,231.7 $ 189.3 4 % $ 182.1 4 % The 4.3% increase in total bookings was primarily driven by continued customer adoption of our productivity solutions and our Websites + Marketing product, partially offset by decreased hosting bookings following the divestiture of certain hosting assets during 2023.
Bookings The following table presents our total bookings for the periods indicated: Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Total bookings $ 5,038.8 $ 4,603.1 $ 4,413.8 $ 435.7 9 % $ 189.3 4 % The 9.5% increase in total bookings for the year ended December 31, 2024 was primarily driven by continued customer adoption of our productivity solutions and related add-ons as well as pricing and bundling initiatives , strength in domains, and continued strong adoption of our website-building presence products and commerce solutions.
Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Marketing and advertising $ 352.9 $ 412.3 $ 503.9 $ (59.4) (14) % $ (91.6) (18) % The 14.4% decrease in marketing and advertising expenses was primarily attributable to a lower level of discretionary spending and headcount reductions resulting from our restructuring activities as discussed in Note 14 to our financial statements.
Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Marketing and advertising $ 356.9 $ 352.9 $ 412.3 $ 4.0 1 % $ (59.4) (14) % The 1.1% increase in marketing and advertising for the year ended December 31, 2024 was primarily attributable to increased discretionary advertising spend in support of our strategic initiatives.
Net cash used in investing activities decreased $29.6 million from $132.0 million in 2022 to $102.4 million in 2023, primarily due to a $72.5 million decrease in spending for business acquisitions, partially offset by a $35.0 million increase in purchases of intangible assets and the purchase of short-term investments totaling $40.0 million.
Net cash provided by investing activities increased $123.9 million from $102.4 million net cash used in 2023 to $21.5 million net cash provided in 2024, due to maturities of short-term investments of $40.0 million, a $15.4 million reduction in capital expenditures and $35.4 million of intangible asset purchases that occurred in 2023.
Our liquidity position also benefits from U.S. and state DTAs such that we have not historically paid a significant amount of U.S. federal or state income taxes. We acquired the right to benefit from the majority of our DTAs when we settled the Tax Receivable Agreements (collectively TRA Settlement Agreements) in 2020.
Our principal uses of cash have been to fund operations and capital expenditures, to make mandatory principal and interest payments on our long-term debt and to effectuate our share repurchase program. Our liquidity position also benefits from U.S. and state DTAs such that we have not historically paid a significant amount of U.S. federal or state income taxes.
Accordingly, these are the policies we believe are the most critical to aid in fully understanding and evaluating our consolidated financial condition and operating results. Revenue Recognition We sell our products directly to customers and also through a network of resellers. In certain cases, we act as a reseller of products provided by others.
Accordingly, we concluded that each domain registration or renewal represents one product offering and is a single performance obligation. We sell our products directly to customers and also through a network of resellers. In certain cases, we act as a reseller of products provided by others.
Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Technology and development $ 839.6 $ 794.0 $ 706.3 $ 45.6 6 % $ 87.7 12 % The 5.7% increase in technology and development expenses was primarily due to increased personnel costs driven by higher average headcount associated with our continued investment in product development.
Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Technology and development $ 814.4 $ 839.6 $ 794.0 $ (25.2) (3) % $ 45.6 6 % The 3.0% decrease in technology and development expenses for the year ended December 31, 2024 was attributable to a $13.0 million decrease in personnel costs driven by lower average headcount and acquisition related employee retention payments, and a $6.8 million decrease in legal, professional, and technology license costs.
We expect general and administrative expenses to fluctuate depending on the level of personnel and other administrative costs required to support our business as well as the significance of any strategic acquisitions we choose to pursue.
We expect general and administrative expenses to fluctuate depending on the level of personnel and other administrative costs required to support our business as well as the significance of any strategic acquisitions we choose to pursue. 63 Table of Contents Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change General and administrative $ 394.2 $ 374.0 $ 385.5 $ 20.2 5 % $ (11.5) (3) % The 5.4% increase in general and administrative expenses for the year ended December 31, 2024 was primarily attributable to a $14.8 million increase in personnel costs, driven by higher stock-based compensation, and an $11.4 million increase in legal and professional costs.
This increase was partially offset by an adjustment recognized during 2023 to a previously-recognized acquisition milestone liability following reassessment of its achievement probability, cloud provider credits recognized in 2023 and decreases in professional fees and infrastructure migration costs. 70 Table of Contents Marketing and advertising Marketing and advertising expenses represent the costs associated with attracting and acquiring customers, primarily consisting of fees paid to third parties for marketing and advertising campaigns across a variety of channels.
Marketing and advertising Marketing and advertising expenses represent the costs associated with attracting and acquiring customers, primarily consisting of fees paid to third parties for marketing and advertising campaigns across a variety of channels. These expenses also include personnel costs and affiliate program commissions.
See Note 18 to our financial statements for a reconciliation of Segment EBITDA to net income, its most directly comparable GAAP financial measure. 72 Table of Contents Applications & Commerce The following table presents the results for our A&C segment for the periods indicated: Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Revenue $ 1,430.4 $ 1,279.7 $ 1,128.3 $ 150.7 12 % $ 151.4 13 % Segment EBITDA $ 594.2 $ 522.8 $ 447.7 $ 71.4 14 % $ 75.1 17 % The 11.8% increase in A&C revenue was primarily driven by: (i) 11.2% growth in revenue related to our productivity applications, most notably our email solutions; (ii) 8.2% growth in revenues due to continued customer adoption of our subscription-based products designed to establish and grow online presence; and (iii) 54.0% growth in commerce-related revenue.
Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change % change $ change % change Cost of revenue $ 1,652.0 $ 1,573.6 $ 1,484.5 $ 78.4 5 % $ 89.1 6 % The 5.0% increase in cost of revenue for the year ended December 31, 2024 was driven by: (i) 7.1% growth in domain registration and add-on revenues and 5.0% growth in aftermarket revenues; (ii) 20.3% growth in revenue related to our productivity applications, most notably our pricing and bundling initiatives; (iii) 8.7% growth in revenues due to continued customer adoption of our subscription-based products designed to establish and grow an online presence; and (iv) 40.1% growth in revenue related to our commerce solutions. 62 Table of Contents Technology and development Technology and development expenses represent the costs associated with the creation, development and distribution of our products and websites.
Deferred Revenue See Note 8 to our financial statements for details regarding the expected future recognition of deferred revenue.
Net cash used in financing activities decreased $584.3 million from $1,261.7 million used in 2023 to $677.4 million used in 2024, primarily due to a $593.7 million decrease in share repurchases. Deferred Revenue See Note 8 to our financial statements for details regarding the expected future recognition of deferred revenue.
We define a customer as an individual or entity with paid transactions in the trailing twelve months or with paid subscriptions as of the end of the period. A single user may be counted as a customer more than once if they maintain paid subscriptions or transactions in multiple accounts.
We define a customer as an individual or entity, each with a unique account and paid transactions in the trailing twelve months or with paid subscriptions as of the end of the period. Total customers is one way we measure the scale of our business and can be a contributing factor to our ability to increase our revenue base.
Revenue derived from both of our product categories has increased in each of the last three years, with many of our non-domains products growing faster in recent periods. 66 Table of Contents In each of the five years ended December 31, 2023, greater than 85% of our total revenue was generated by customers who were also customers in the prior year.
Total bookings and revenue derived from both of our product categories have increased in each of the last three years, with many of our non-domains products growing faster in recent periods. The primary factors driving growth in our business are pricing and bundling, seamless technology experience, commerce, cost optimization and retention of high intent customers.
Liquidity and Capital Resources Overview Our principal sources of liquidity have been cash flow generated from operations, long-term debt borrowings, stock option exercises and Employee Stock Purchase Plan (ESPP) proceeds.
Partially offsetting these increases was an increase in cost of revenue due to 7.1% growth in domain registration and add-on revenues and 5.0% growth in aftermarket revenues. Liquidity and Capital Resources Overview Our principal sources of liquidity have been cash flow generated from operations and long-term debt borrowings.
Our Financial Model We have developed a stable and durable business model driven by strong brand recognition, efficient customer acquisition, high customer retention rates and increasing lifetime spend of our customers.
We have developed a stable and durable business model driven by strong brand recognition, seamless technology, scale of our business and customer care. We generate bookings and revenue, which help us measure the success of our efforts, from the sales of our product subscriptions.
Core Platform The following table presents the results for our Core segment for the periods indicated: Year Ended December 31, 2023 to 2022 2022 to 2021 2023 2022 2021 $ change % change $ change % change Revenue $ 2,823.7 $ 2,811.6 $ 2,687.4 $ 12.1 0 % $ 124.2 5 % Segment EBITDA $ 816.4 $ 783.7 $ 679.7 $ 32.7 4 % $ 104.0 15 % The 0.4% increase in Core revenue was primarily driven by 4.1% growth in domain-related revenues and the continued growth of our registry business, partially offset by a 7.8% decrease in hosting revenues primarily due to end-of-life migrations from certain products, and the divestiture of certain hosting assets during the year.
This increase was partially offset by an increase in cost of revenue resulting from 20.3% growth in revenue related to our productivity applications, most notably our pricing and bundling initiatives and increased adoption of our products containing proprietary software, a 40.1% growth in revenue related to our commerce solutions, and a $20.4 million increase in operating expenses (excluding acquisition-related costs, equity-based compensation expense and depreciation and amortization) attributable to higher technology and development costs and marketing costs. 65 Table of Contents Core Platform The following table presents the results for our Core segment for the periods indicated: Year Ended December 31, 2024 to 2023 2023 to 2022 2024 2023 2022 $ change %/bps change $ change %/bps change Revenue $ 2,920.2 $ 2,823.7 $ 2,811.6 $ 96.5 3 % $ 12.1 0 % Segment EBITDA $ 931.7 $ 816.4 $ 783.7 $ 115.3 14 % $ 32.7 4 % Segment EBITDA Margin 31.9 % 28.9 % 27.9 % n/a 300 bps n/a 100 bps The 14.1% increase in Core Segment EBITDA for the year ended December 31, 2024 was attributed to a $96.6 million increase in revenue as described above and a $42.1 million decrease in operating expenses (excluding acquisition-related costs and equity-based compensation expense and depreciation and amortization) attributable to lower marketing, customer care and technology and development costs.
We selected the 2017 cohort as an example for this analysis, which we believe helps to illustrate the long-term value of our customers. Results of Operations The following table sets forth our results of operations for the periods presented and as a percentage of our total revenue for those periods.
(3) A reconciliation of Normalized EBITDA to net income, its most directly comparable GAAP financial measure, is set forth in "Reconciliation of NEBITDA" below . 59 Table of Contents Results of Operations The following table sets forth our results of operations for the periods presented and as a percentage of our total revenue for those periods.
Removed
We have broadened our business model over the past several years to encompass a meaningful set of transactional relationships with our customers in areas such as aftermarket, commerce and payments and reseller agreements where one account may give us access to many users.
Added
Our key priorities, developments and highlights in these areas include: Seamless Technology and Airo . We continue to expand our AI-powered experiences, including Airo, and incorporate AI innovations into our products, services and throughout our operations to make use of efficiencies and increase productivity.
Removed
We have also observed an increase in users that have converted from owning paid to free subscriptions during this time, coinciding with our experimentation with freemium services as our customers engage in more varied types of business with us.
Added
We remain focused on expanding our solutions and operations to stay up to date with these developments in order to maintain and grow our business. Cost Optimization and Profitability .
Removed
We grew our total customers from 20.1 million as of December 31, 2020 to 21.0 million as of December 31, 2023, through a combination of our industry leading products built on a cloud platform, brand advertising, direct marketing efforts, customer referrals, world-class customer care and acquisitions.
Added
During the year ended December 31, 2024, the Company engaged in cost optimization initiatives, including reductions in headcount, decreases in rent and utilities expenses, and reductions in costs associated with data center and systems infrastructure as we continue to migrate to a cloud-based infrastructure. 58 Table of Contents Pricing and Bundling .
Removed
We offer our subscriptions on a variety of terms, which can range from monthly to multi-annual terms of up to ten years depending on the product. We monitor total bookings as we typically collect payment at the time of sale and generally recognize revenue ratably over the term of our customer contracts.
Added
During the year ended December 31, 2024, pricing and bundling initiatives resulted in an increase in bookings and continued strong growth in A&C revenue. We aim to continue to experiment and utilize various pricing strategies and price points for our solutions. In addition, as we continue to incorporate AI innovations into our solutions, monetization trends could be affected. Commerce.
Removed
A&C revenue primarily consists of revenue from sales of products containing proprietary software such as Websites + Marketing and Managed WordPress and commerce products such as payment processing fees and point-of-sale (POS) hardware as well as sales of third-party email and productivity solutions such as Microsoft 365.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

11 edited+4 added−3 removed15 unchanged
Biggest changeThese interest rate swaps, which had a notional amount of $1,235.9 million as of December 31, 2023, serve to convert a portion of the variable-rate borrowings under the 2029 Term Loans to a fixed rate of 4.81%. 79 Table of Contents In August 2020, we entered into seven-year pay-fixed rate, receive-floating rate interest rate swap arrangements to effectively convert a portion of the variable rate borrowings under the 2027 Term Loans to a fixed rate of 0.705%.
Biggest changeIn August 2020, we entered into seven-year pay-fixed rate, receive-floating rate interest rate swap arrangements to effectively convert a portion of the variable rate borrowings under the 2027 Term Loans to a fixed rate of 0.705%.
To mitigate such counterparty credit risk, we enter into contracts only with carefully selected financial institutions based upon ongoing evaluations of their creditworthiness. As a result, we do not believe we are exposed to any undue concentration of counterparty risk with respect to our derivative contracts as of December 31, 2023.
To mitigate such counterparty credit risk, we enter into contracts only with carefully selected financial institutions based upon ongoing evaluations of their creditworthiness. As a result, we do not believe we are exposed to any undue concentration of counterparty risk with respect to our derivative contracts as of December 31, 2024.
The cross-currency swaps had an aggregate amortizing notional amount of €1,159.4 million at December 31, 2023 (approximately $1,279.7 million). The swaps designated as cash flow hedging relationships convert the Euro-denominated interest and principal receipts on the intercompany loan into fixed U.S. dollar interest and principal receipts, thereby reducing our exposure to fluctuations between the Euro and U.S. dollar.
The cross-currency swaps had an aggregate amortizing notional amount of €1,146.9 million at December 31, 2024 (approximately $1,187.4 million). The swaps designated as cash flow hedging relationships convert the Euro-denominated interest and principal receipts on the intercompany loan into fixed U.S. dollar interest and principal receipts, thereby reducing our exposure to fluctuations between the Euro and U.S. dollar.
Gains and losses, once realized, are recorded as a component of AOCI and are amortized to revenue over the same period in which the underlying hedged amounts are recognized. At December 31, 2023, the realized gain and unrealized loss included in AOCI were $6.3 million and $13.2 million, respectively.
Gains and losses, once realized, are recorded as a component of AOCI and are amortized to revenue over the same period in which the underlying hedged amounts are recognized. At December 31, 2024, the realized gain and unrealized gain included in AOCI were $2.0 million and $33.2 million, respectively.
In January 2024, we entered into an amendment to the Credit Facility to refinance the 2029 Term Loans, as discussed in Note 20 to our financial statements. All SOFR-based interest rates under the Credit Facility are subject to a 0.0% floor.
In January, May, and December of 2024, we entered into amendments to the Credit Facility to refinance the 2029 and 2031 Term Loans, as discussed in Note 10 to our financial statements. All SOFR-based interest rates under the Credit Facility are subject to a 0.0% floor.
For the balance of our long-term debt not subject to interest rate swaps, the effect of a hypothetical 10% change in interest rates would not have had a material impact on our interest expense. 80 Table of Contents
For the balance of our long-term debt not subject to interest rate swaps, the effect of a hypothetical 10% change in interest rates would not have had a material impact on our interest expense. See Note 10 to our financial statements for additional information regarding our long-term debt.
The objective of our interest rate swaps, all of which are designated as cash flow hedges, is to manage the variability of cash flows in the interest payments related to the portion of variable-rate debt designated as being hedged.
We manage our exposure to changes in interest payments related to the portion of variable-rate debt through the use of interest rate swaps, all of which are designated as cash flow hedges.
The swaps designated as net investment hedging relationships hedge the foreign currency exposure of our net investment in certain Euro denominated functional currency subsidiaries. At maturity, the Euro notional value will be exchanged for the U.S. dollar notional value. Interest Rate Risk Interest rate risk reflects our exposure to movements in interest rates associated with our variable-rate debt.
At maturity, the Euro notional value will be exchanged for the U.S. dollar notional value. 71 Table of Contents Interest Rate Risk Interest rate risk reflects our exposure to movements in interest rates associated with our variable-rate debt.
Total borrowings under our 2029 Term Loans were $1,752.3 million as of December 31, 2023.
Total borrowings under our 2031 Term Loans were $995.0 million as of December 31, 2024.
During 2023, our total bookings growth in constant currency would have been approximately 40 basis points higher and our total revenue growth would 78 Table of Contents have been approximately 60 basis points higher.
During 2024, our total bookings growth in constant currency would have been approximately 20 basis points higher and our total revenue growth would have had an insignificant impact.
In May 2023, in conjunction with the concurrent Credit Facility amendment discussed in Note 10, the hedged debt index of the swaps was changed from LIBOR to SOFR. These interest rate swaps, which mature on August 10, 2027, had an aggregate notional amount of $723.8 million at December 31, 2023.
In May 2023, in conjunction with the concurrent Credit Facility amendment discussed in Note 10, we terminated these swaps and entered into new SOFR-based interest rate swaps with a fixed rate of 0.672%. These interest rate swaps, which mature on August 10, 2027, had an aggregate notional amount of $716.3 million at December 31, 2024. 72 Table of Contents
Removed
See Note 10 to our financial statements for additional information regarding our long-term debt. Total borrowings under our 2027 Term Loans were $723.8 million as of December 31, 2023.
Added
The swaps designated as net investment hedging relationships hedge the foreign currency exposure of our net investment in certain Euro denominated functional currency subsidiaries.
Removed
These borrowings bear interest at a rate equal to, at our option, either (a) Secured Overnight Financing Rate (SOFR) together with a credit spread adjustment for the applicable interest period plus a margin of 2.0% per annum or (b) a margin of 1.0% per annum plus the highest of (i) the Federal Funds Rate plus 0.5%, (ii) the Prime Rate or (iii) SOFR for an interest period of one month plus 1.0%.
Added
The amortization rate for the 2031 Term Loans is 1.00% per annum and the 2031 Term Loans were issued at an applicable margin of (i) 1.75% for the term loans that are Secured Overnight Financing Rate (SOFR) loans and (ii) 0.75% for the term loans that are ABR loans.
Removed
These borrowings bear interest at a rate equal to, at our option, either (a) SOFR for the applicable interest period plus a margin of 2.5% per annum or (b) a margin of 1.5% per annum plus the highest of (i) the Federal Funds Rate plus 0.5%, (ii) the Prime Rate or (iii) SOFR for an interest period of one month plus 1.0%.
Added
Total borrowings under our 2029 Term Loans were $1,458.9 million as of December 31, 2024. The amortization rate for the 2029 Term Loans is 1.00% per annum and the 2029 Term Loans were issued at an applicable margin of (i) 1.75% for the term loans that are SOFR loans and (ii) 0.75% for the term loans that are ABR loans.
Added
These interest rate swaps, which had a notional amount of $1,222.7 million as of December 31, 2024, serve to convert a portion of the variable-rate borrowings under the 2029 Term Loans to a fixed rate of 4.81%.

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