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GODADDY REPORTS STRONG FOURTH QUARTER AND FULL YEAR 2023 RESULTS

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2 years ago

on

Q4 2023 Applications & Commerce revenue up 13%; 
Delivered Q4 net income margin of 103%, inclusive of non-routine items, and Q4 Normalized EBITDA margin of over 29%
Cash Provided by Operating Activities up 43% in Q4; Free Cash Flow up 51% in Q4

TEMPE, Ariz., Feb. 13, 2024 /PRNewswire/ — GoDaddy Inc. (NYSE: GDDY) today reported financial results for the fourth quarter and full year that ended December 31, 2023.

“GoDaddy demonstrated strong operational execution and financial performance while also making significant progress in our mission of empowering entrepreneurs around the world,” said GoDaddy CEO Aman Bhutani. “We are excited and confident in our ability to deliver compelling solutions for our customers across our simplified software platform while continuing to strengthen our strategic positioning.”

“GoDaddy delivered strong 2023 financial results, showcasing our ability to provide a one-stop shop for our customers and drive margin expansion through operational discipline,” said GoDaddy CFO Mark McCaffrey. “We remain committed to managing our business to provide an optimal combination of top-line growth and profitability, delivering compounding free cash flow and creating enduring shareholder value.”

Full Year 2023 Business Highlights

Total revenue of $4.3 billion, up 4% year-over-year, and 5% on a constant currency basis.Total bookings of $4.6 billion, up 4% year-over-year, and 5% on a constant currency basis.Net Income of $1.4 billion, inclusive of non-routine items, up 295% year-over-year, representing a 33% margin.Normalized EBITDA (NEBITDA) of $1.1 billion, up 12% year-over-year, representing a 27% margin.Net cash provided by operating activities of $1,047.6 million, up 7% year-over-year.Free cash flow of $1.1 billion, up 12% year-over-year.On January 1, 2024, GoDaddy’s subsidiary holding company, Desert Newco, LLC, was converted from a partnership to a disregarded entity for U.S. income tax purposes, thereby terminating its legacy Up-C structure.

Fourth Quarter 2023 Business Highlights

Total revenue of $1.1 billion, up 6% year-over-year on a reported and constant currency basis.Total bookings of $1.1 billion, up 7% year-over-year, and 6% on a constant currency basis.Net income of $1.1 billion, inclusive of non-routine items, up 1,107% year-over-year, representing a 103% margin.NEBITDA of $324.2 million, up 22% year-over-year, representing a 29% margin.Net cash provided by operating activities of $297.7 million, up 43% year-over-year.Free cash flow of $305.1 million, up 51% year-over-year.Gross payments volume, or GPV, from GoDaddy’s commerce offerings grew to an impressive $1.7 billion, up 125% year-over-year. Gross merchandise volume was $36 billion, up 26% year-over-year.GoDaddy launched its AI experience, GoDaddy AiroTM, within the U.S. GoDaddy AiroTM harnesses the power of generative AI and other machine learning to proactively help build and grow online ventures, delivering a business-in-a-box experience that automatically generates a logo, website, tailored content, communications, and more. Customers engage with it within minutes of registering a domain or can use other features if they have an established website.

Consolidated Fourth Quarter and Full Year Financial Highlights

Three Months Ended
 December 31,

Year Ended 
December 31, 

2023

2022

Change

Constant
Currency

2023

2022

Change

Constant
Currency

(in millions, except customers in thousands and ARPU in dollars)

GAAP Results

Total revenue

$  1,100.3

$  1,039.9

5.8 %

5.8 %

$ 4,254.1

$ 4,091.3

4.0 %

4.6 %

Applications & commerce revenue

$   377.4

$   333.4

13.2 %

$ 1,430.4

$ 1,279.7

11.8 %

Core platform revenue

$   722.9

$   706.5

2.3 %

$ 2,823.7

$ 2,811.6

0.4 %

International revenue

$   353.9

$   340.8

3.8 %

3.8 %

$ 1,381.1

$ 1,334.0

3.5 %

5.3 %

Net income(1)

$  1,132.3

$     93.8

1,107.1 %

$  1,393.8

$   352.9

295.0 %

Net cash provided by operating
activities

$   297.7

$   208.0

43.1 %

$  1,047.6

$   979.7

6.9 %

Segment EBITDA – A&C

$   164.8

$   135.6

21.5 %

$   594.2

$   522.8

13.7 %

Segment EBITDA margin – A&C

43.7 %

40.7 %

300 bps

41.5 %

40.9 %

70 bps

Segment EBITDA – Core

$   227.8

$   204.8

11.2 %

$   816.4

$   783.7

4.2 %

Segment EBITDA margin – Core

31.5 %

29.0 %

250 bps

28.9 %

27.9 %

100 bps

Non-GAAP Results(2)

Normalized EBITDA (NEBITDA)

$   324.2

$   266.0

21.9 %

$ 1,134.5

$ 1,013.0

12.0 %

NEBITDA margin

29.5 %

25.6 %

390 bps

26.7 %

24.8 %

190 bps

Unlevered free cash flow

$   346.6

$   238.2

45.5 %

$ 1,254.2

$ 1,095.9

14.4 %

Free cash flow

$   305.1

$   201.6

51.3 %

$  1,084.4

$   968.6

12.0 %

Operating and Business Metrics

Total bookings

$  1,123.9

$  1,051.6

6.9 %

6.5 %

$ 4,603.1

$ 4,413.8

4.3 %

4.7 %

Total customers at period end

21,026

20,897

0.6 %

21,026

20,897

0.6 %

Average revenue per user (ARPU)

$      203

$      197

3.0 %

$      203

$      197

3.0 %

Annualized  Recurring Revenue
(ARR)

$  3,690.8

$  3,570.1

3.4 %

$ 3,690.8

$ 3,570.1

3.4 %

_______________________________

(1) Net income for the three months and the year ended December 31, 2023 includes $11.2 million and $90.8 million, respectively, in restructuring and other charges. In addition, during the fourth quarter of 2023, we released the majority of our valuation allowance on U.S. and state deferred tax assets, resulting in a non-routine non-cash benefit of approximately $1 billion recorded to income taxes.

(2) Reconciliations of our non-GAAP results to their most directly comparable GAAP financial measures are set forth in “Reconciliation of Non-GAAP Financial Measures” below.

 

Share Repurchases

From January 1, 2022 through February 1, 2024, GoDaddy repurchased 34.2 million shares of its common stock for an aggregate purchase price of $2.6 billion, and an average price per share of $74.99. These repurchases represent a reduction of approximately 20% in fully diluted shares from those outstanding as of December 31, 2021.

Balance Sheet

At December 31, 2023, total cash and cash equivalents and short-term investments were $498.8 million, total debt was $3.9 billion and net debt was $3.4 billion.

Debt Repricing

In January 2024, GoDaddy repriced $1.8 billion of the outstanding principal amount of its term loans to lower the interest rate margins by 0.5%. This strategic adjustment and the repricing we completed in July 2023 are expected to reduce annual cash interest expense by approximately $22.0 million. The refinanced loans retain the original maturity date and other terms and conditions.

Partial Release of Valuation Allowance

During the fourth quarter, as a result of our increasing profitability over the past several years and forecasted levels of future taxable income, we released the majority of our valuation allowance on our U.S. and state deferred tax assets. This resulted in a non-cash benefit of approximately $1 billion recorded to income taxes.

Business Outlook

For the first quarter ending March 31, 2024, GoDaddy expects total revenue in the range of $1.085 billion to $1.105 billion, representing year-over-year growth of 6% at the midpoint, versus the same period in 2023. For the full year ending December 31, 2024, GoDaddy is targeting total revenue in the range of $4.480 billion to $4.560 billion, representing year-over-year growth of 6% at the midpoint, versus the $4.25 billion of revenue generated for the full year ended December 31, 2023.

For the first quarter ending March 31, 2024, GoDaddy expects Normalized EBITDA margin of 27%. For the full year ending December 31, 2024, GoDaddy expects Normalized EBITDA margin of approximately 29%, with a fourth quarter Normalized EBITDA margin of approximately 31%.

For the full year ending December 31, 2024, GoDaddy expects unlevered free cash flow of at least $1.4 billion, versus the $1.3 billion of unlevered free cash flow generated in 2023. GoDaddy expects free cash flow of at least $1.2 billion, versus the $1.1 billion of free cash flow generated in 2023.

Modeling Guide

2024

Capital expenditures

~ $35 million

Cash interest on long-term debt

~ $155 million

Cash income taxes

~ $30 million

 

GoDaddy’s consolidated financial statements are prepared in accordance with generally accepted accounting principles in the United States (GAAP). GoDaddy does not provide reconciliations from non-GAAP guidance to GAAP equivalents because projections of changes in individual balance sheet amounts are not possible without unreasonable effort, and presentation of such reconciliations would imply an inappropriate degree of precision. GoDaddy provided reconciliations of non-GAAP financial measures to their nearest GAAP equivalents in the tables included within this release.

Upcoming Investor Events

GoDaddy will hold an in-person Investor Day on March 6, 2024 at its Tempe, Arizona headquarters during which leaders will discuss GoDaddy’s long-term strategy, innovation initiatives, financial framework, and capital allocation strategy, as well as provide demonstrations of recently launched customer experiences. Given limited space for the live event, interested shareholders and analysts are encouraged to email investors@godaddy.com for an invitation. The event, along with supporting materials, will be accessible live or via an archived replay through the Investor Relations section of GoDaddy’s website at https://investors.godaddy.net.

Quarterly Earnings Webcast

GoDaddy will host a webcast to discuss fourth quarter and full year 2023 results at 5:00 p.m. Eastern Time on February 13, 2024. To participate in the webcast, please preregister online at https://investors.godaddy.net/investor-relations/overview/default.aspx. A live webcast of the event, together with a slide presentation including supplemental financial information and reconciliations of certain non-GAAP measures to their nearest comparable GAAP measures, will be available through GoDaddy’s Investor Relations website at https://investors.godaddy.net. A transcript of prerecorded remarks will be available on the Investor Relations website at the time of the webcast. Following the event, a recorded replay of the webcast will be available on the website.

GoDaddy uses its Investor Relations website at https://investors.godaddy.net as a means of disclosing material non-public information and to comply with its disclosure obligations under Regulation FD. Accordingly, investors should monitor GoDaddy’s Investor Relations website, in addition to following press releases, Securities and Exchange Commission (SEC) filings, public conference calls and webcasts.

Forward-Looking Statements

This press release contains forward-looking statements which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on estimates and information available to us at the time of this press release and are not guarantees of future performance. Statements in this press release involve risks, uncertainties and assumptions. If the risks or uncertainties materialize or the assumptions prove incorrect, our results may differ materially from those expressed or implied by such forward-looking statements. All statements other than statements of historical fact could be deemed forward-looking statements, including, but not limited to any statements regarding: our business outlook; launches of new or expansion of existing products or services, including GoDaddy AiroTM, any projections of product or service availability, technology developments and innovation, customer growth, or other future events; historical results that may suggest future trends for our business; our plans, strategies or objectives with respect to future operations, partnerships and partner integrations and marketing strategy; future financial results; our ability to integrate acquisitions and achieve desired synergies and vertical integration; the expected impact of our debt repricing; our forecasted levels of future taxable income; and assumptions underlying any of the foregoing.

Actual results could differ materially from our current expectations as a result of many factors, including, but not limited to: the unpredictable nature of our rapidly evolving market; fluctuations in our financial and operating results; our rate of growth; interruptions or delays in our service or our web hosting; our dependence on payment card networks and acquiring processors; breaches of our security measures; the impact of any previous or future acquisitions or divestitures; our ability to continue to release, and gain customer acceptance of, our existing and future products and services; our ability to deploy new and evolving technologies, such as artificial intelligence, machine learning, data analytics and similar tools, in our offerings; our ability to manage our growth; our ability to hire, retain and motivate employees; the effects of competition; technological, regulatory and legal developments; intellectual property litigation; the impact of our restructuring efforts; macroeconomic conditions and developments in the economy, financial markets and credit markets; continued escalation of geopolitical tensions; the level of interest rates and inflationary pressures; and execution of share repurchases.

Additional risks and uncertainties that could affect GoDaddy’s business and financial results are included in the filings we make with the SEC from time to time, including those described in “Risk Factors” in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2022 and in our Quarterly Report on Form 10-Q for the quarter ended September 30, 2023, each of which are available on GoDaddy’s website at https://investors.godaddy.net and on the SEC’s website at www.sec.gov, and any subsequent quarterly or annual report filed with the SEC thereafter, including our annual report on Form 10-K for the year ended December 31, 2023. Additional information will also be set forth in other filings that GoDaddy makes with the SEC from time to time. All forward-looking statements in this press release are based on information available to GoDaddy as of the date hereof. Except to the extent required by law, GoDaddy does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.

Non-GAAP Financial Measures and Other Operating and Business Metrics

In addition to our financial results prepared in accordance with GAAP, this press release includes certain non-GAAP financial measures and other operating and business metrics. We believe that these non-GAAP financial measures and other operating and business metrics are useful as a supplement in evaluating our ongoing operational performance and enhancing an overall understanding of our past financial performance. The non-GAAP financial measures included in this press release should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. In addition, similarly titled measures may be calculated differently by other companies and may not be comparable. A reconciliation between each non-GAAP financial measure and its nearest GAAP equivalent is included in this press release following the financial statements. We use both GAAP and non-GAAP measures to evaluate and manage our operations.

Total bookings. Total bookings is an operating metric representing the total value of customer contracts entered into during the period, excluding refunds. We believe total bookings provides additional insight into the performance of our business and the effectiveness of our marketing efforts since we typically collect payment at the inception of a customer contract but recognize revenue ratably over the term of the contract.

Constant currency. Constant currency is calculated by translating bookings and revenue for each month in the current period using the foreign currency exchange rates for the corresponding month in the prior period, excluding any hedging gains or losses realized during the period. We believe constant currency information is useful in analyzing underlying trends in our business by eliminating the impact of fluctuations in foreign currency exchange rates and allows for period-to-period comparisons of our performance.

Normalized EBITDA (NEBITDA). 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. 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.

NEBITDA margin. NEBITDA margin is used by management as a supplemental measure of our operating performance and refers to the ratio of NEBITDA to revenue, expressed as a percentage.

Unlevered free cash flow. Unlevered free cash flow is a measure of our liquidity used by management to evaluate our business prior to the impact of our capital structure and restructuring and after purchases of property and equipment. Such liquidity can be used by us for strategic opportunities and strengthening our balance sheet. However, given our debt obligations, unlevered free cash flow does not represent residual cash flow available for discretionary expenses.

Free cash flow. Free cash flow is defined as our unlevered free cash flow less interest payments for the period. We use free cash flow as a supplemental measure of our liquidity, including our ability to generate cash flow in excess of capital requirements and return cash to shareholders, though it should not be considered as an alternative to, or more meaningful than, comparable GAAP measures.

Net debt. We define net debt as total debt less cash and cash equivalents and short-term investments. Total debt consists of the current portion of long-term debt plus long-term debt and unamortized original issue discount and debt issuance costs. Our management reviews net debt as part of its management of our overall liquidity, financial flexibility, capital structure and leverage and we believe such information is useful to investors. Furthermore, certain analysts and debt rating agencies monitor our net debt as part of their assessments of our business.

Gross merchandise volume (GMV). GMV is a business metric calculated by annualizing the total quarterly dollar value of orders facilitated by our customers through our Commerce platform, including shipping and handling, and taxes, and is shown net of discounts, and returns (where visibility exists). While GMV is not indicative of our performance, we believe it is an indicator of the strengths of our products and platforms.

Gross payments volume (GPV). GPV is an operating metric calculated by annualizing the total quarterly dollar value of transactions processed through our payments platform. GPV is representative of the volume of transactions in which we record transaction revenue based on our payment processing rate.

Annualized recurring revenue (ARR). 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. We believe ARR helps illustrate the scale of certain of our products and facilitates comparisons to other companies in our industry.

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 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.

Total customers. 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. 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. 

About GoDaddy

GoDaddy helps millions of entrepreneurs globally start, grow, and scale their businesses. People come to GoDaddy to name their idea, build a professional website, attract customers, sell their products and services, and accept payments online and in-person. GoDaddy’s easy-to-use tools help microbusiness owners manage everything in one place and its expert guides are available to provide assistance 24/7. To learn more about the company, visit www.GoDaddy.com.

 

GoDaddy Inc.
Consolidated Statements of Operations (unaudited)
(In millions, except shares in thousands and per share amounts)

Three Months Ended
December 31,

Year Ended
December 31,

2023

2022

2023

2022

Revenue:

Applications & commerce

$      377.4

$      333.4

$   1,430.4

$   1,279.7

Core platform

722.9

706.5

2,823.7

2,811.6

Total revenue

1,100.3

1,039.9

4,254.1

4,091.3

Costs and operating expenses(1):

Cost of revenue (excluding depreciation and amortization)

402.2

379.5

1,573.6

1,484.5

Technology and development

203.8

206.3

839.6

794.0

Marketing and advertising

84.6

94.9

352.9

412.3

Customer care

74.3

75.3

304.5

305.9

General and administrative

95.6

98.6

374.0

385.5

Restructuring and other

11.2

0.9

90.8

15.7

Depreciation and amortization

38.7

49.5

171.3

194.6

Total costs and operating expenses

910.4

905.0

3,706.7

3,592.5

Operating income

189.9

134.9

547.4

498.8

Interest expense

(43.6)

(42.2)

(179.0)

(146.3)

Loss on debt extinguishment

—

(3.6)

(1.5)

(3.6)

Other income (expense), net

1.2

6.8

36.9

7.6

Income before income taxes

147.5

95.9

403.8

356.5

Benefit (provision) for income taxes

984.8

(2.1)

990.0

(3.6)

Net income

1,132.3

93.8

1,393.8

352.9

Less: net income attributable to non-controlling interests

0.2

0.2

0.8

0.7

Net income attributable to GoDaddy Inc.

$   1,132.1

$        93.6

$   1,393.0

$      352.2

Net income attributable to GoDaddy Inc. per share of Class A common
stock:

Basic

$        8.01

$        0.60

$        9.39

$        2.22

Diluted

$        7.85

$        0.60

$        9.20

$        2.19

Weighted-average shares of Class A common stock outstanding:

Basic

141,418

154,745

148,296

158,788

Diluted

144,253

157,083

151,452

161,457

____________________________________

(1)   Costs and operating expenses include equity-based compensation expense as follows:

Cost of revenue

$            0.2

$            0.4

$           1.3

$           1.5

Technology and development

39.2

37.9

162.4

140.3

Marketing and advertising

6.9

7.4

27.9

29.1

Customer care

6.1

5.4

24.1

20.0

General and administrative

16.3

20.0

78.3

73.5

Restructuring and other

—

—

2.3

—

Total equity-based compensation expense

$          68.7

$          71.1

$        296.3

$        264.4

 

GoDaddy Inc.
Consolidated Balance Sheets (unaudited)
(In millions, except per share amounts)

December 31,

2023

2022

Assets

Current assets:

Cash and cash equivalents

$      458.8

$      774.0

Short-term investments

40.0

—

Accounts and other receivables

76.6

60.1

Registry deposits

37.3

41.0

Prepaid domain name registry fees

466.0

435.7

Prepaid expenses and other current assets

177.2

271.8

Total current assets

1,255.9

1,582.6

Property and equipment, net

185.3

225.6

Operating lease assets

60.8

84.1

Prepaid domain name registry fees, net of current portion

209.0

197.1

Goodwill

3,569.3

3,536.9

Intangible assets, net

1,158.6

1,252.2

Deferred tax assets

1,038.8

—

Other assets

105.6

95.0

Total assets

$   7,583.3

$   6,973.5

Liabilities and stockholders’ equity (deficit)

Current liabilities:

Accounts payable

$      148.1

$      130.9

Accrued expenses and other current liabilities

442.4

356.7

Deferred revenue

2,074.9

1,954.0

Long-term debt

17.9

18.2

Total current liabilities

2,683.3

2,459.8

Deferred revenue, net of current portion

802.4

770.3

Long-term debt, net of current portion

3,798.5

3,812.9

Operating lease liabilities, net of current portion

90.2

116.5

Other long-term liabilities

90.7

87.1

Deferred tax liabilities

37.8

56.2

Commitments and contingencies

Stockholders’ equity (deficit):

Preferred stock, $0.001 par value

—

—

Class A common stock, $0.001 par value

0.1

0.2

Class B common stock, $0.001 par value

—

—

Additional paid-in capital

2,271.6

1,912.6

Accumulated deficit

(2,302.5)

(2,422.6)

Accumulated other comprehensive income

111.2

178.0

Total stockholders’ equity (deficit) attributable to GoDaddy Inc.

80.4

(331.8)

Non-controlling interests

—

2.5

Total stockholders’ equity (deficit)

80.4

(329.3)

Total liabilities and stockholders’ equity (deficit)

$   7,583.3

$   6,973.5

 

GoDaddy Inc.
Consolidated Statements of Cash Flows (unaudited)
(In millions)

Year Ended
December 31,

2023

2022

Operating activities

Net income

$  1,393.8

$    352.9

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

171.3

194.6

Equity-based compensation

296.3

264.4

Gain (loss) on derivative instruments

(12.0)

27.6

Non-cash restructuring and other charges

6.1

10.4

Deferred taxes

(1,011.6)

(18.4)

Loss on dispositions

16.5

—

Other

56.5

66.8

Changes in operating assets and liabilities, net of amounts acquired:

Prepaid domain name registry fees

(41.9)

(34.7)

Accounts payable

28.3

35.1

Accrued expenses and other current liabilities

56.4

11.3

Deferred revenue

149.2

101.6

Other operating assets and liabilities

(61.3)

(31.9)

Net cash provided by operating activities

1,047.6

979.7

Investing activities

Purchases of short-term investments

(40.0)

—

Business acquisitions, net of cash acquired

—

(72.5)

Purchases of intangible assets

(35.4)

(0.4)

Net proceeds received from dispositions

12.7

—

Purchases of property and equipment

(42.0)

(59.7)

Purchases of equity investments

(0.5)

—

Other investing activities, net

2.8

0.6

Net cash used in investing activities

(102.4)

(132.0)

Financing activities

Proceeds received from:

Issuance of term loans

1,759.9

1,725.3

Stock option exercises

19.6

19.9

Issuance of Class A common stock under employee stock purchase plan

30.0

30.1

Payments made for:

Repurchases of Class A common stock

(1,270.2)

(1,294.6)

Repayment of term loans

(1,786.3)

(1,789.9)

Financing-related costs

—

(4.2)

Contingent consideration for business acquisitions

(7.5)

(9.3)

Other financing obligations

(7.2)

(4.0)

Net cash used in financing activities

(1,261.7)

(1,326.7)

Effect of exchange rate changes on cash and cash equivalents

1.3

(2.7)

Net decrease in cash and cash equivalents

(315.2)

(481.7)

Cash and cash equivalents, beginning of period

774.0

1,255.7

Cash and cash equivalents, end of period

$    458.8

$    774.0

Reconciliation of Non-GAAP Financial Measures

The following tables reconcile each non-GAAP financial measure to its most directly comparable GAAP financial measure:

Three Months Ended
December 31,

Year Ended 
December 31, 

2023

2022

2023

2022

NEBITDA and NEBITDA Margin:

(in millions)

Net income

$   1,132.3

$       93.8

$   1,393.8

$      352.9

Depreciation and amortization

38.7

49.5

171.3

194.6

Equity-based compensation(1)

68.7

71.1

294.0

264.4

Interest expense, net

40.2

36.1

155.4

135.0

Acquisition-related expenses(2)

4.9

7.9

12.1

35.1

Restructuring and other(3)

24.2

5.5

97.9

27.4

Provision (benefit) for income taxes

(984.8)

2.1

(990.0)

3.6

NEBITDA

$      324.2

$      266.0

$   1,134.5

$   1,013.0

Net income margin

102.9 %

9.0 %

32.8 %

8.6 %

NEBITDA margin

29.5 %

25.6 %

26.7 %

24.8 %

_________________________________

(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.

(2)

The year ended December 31, 2023 includes an adjustment of $6.0 million to a previously-recognized acquisition milestone liability.

(3)

In addition to the restructuring and other in our statements of operations, other charges included 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 professional services.

 

December 31,
2023

(in millions)

Net Debt:

Current portion of long-term debt

$             17.9

Long-term debt

3,798.5

Unamortized original issue discount and debt issuance costs

59.7

Total debt

3,876.1

Less: Cash and cash equivalents

(458.8)

Less: Short-term investments

(40.0)

Net debt

$        3,377.3

 

Three Months Ended
December 31,

Year Ended
December 31, 

2023

2022

2023

2022

(in millions)

Free Cash Flow and Unlevered Free Cash Flow:

Net cash provided by operating activities

$      297.7

$      208.0

$   1,047.6

$      979.7

Capital expenditures

(4.0)

(17.1)

(42.0)

(59.7)

Cash paid for acquisition-related costs

0.8

7.2

11.2

37.9

Cash paid for restructuring and other charges(1)

10.6

3.5

67.6

10.7

Free cash flow

$      305.1

$      201.6

$   1,084.4

$      968.6

Cash paid for interest on long-term debt

41.5

36.6

169.8

127.3

Unlevered free cash flow

$      346.6

$      238.2

$   1,254.2

$   1,095.9

_________________________________

(1)

In addition to payments made pursuant to our February 2023 restructuring plan, cash paid for restructuring and other charges includes a payment related to the termination of a revenue sharing agreement, lease-related payments associated with closed facilities, payments related to certain legal matters as well as third party payments incurred in relation to the refinancing of our long-term debt and incremental payments associated with professional services.

Shares Outstanding

Shares of Class B common stock are not participating securities, and therefore do not have rights to share in our earnings. Total shares of common stock outstanding are as follows:

December 31,

2023

2022

(in thousands)

Shares Outstanding:

Class A common stock

142,051

153,830

Class B common stock

259

312

Total common stock outstanding

142,310

154,142

Effect of dilutive securities(1)

2,599

2,026

    Total shares outstanding

144,909

156,168

_________________________________

(1) Calculated using the treasury stock method, which excludes the impact of antidilutive securities.

Constant Currency
The following table provides a reconciliation of constant currency:

Three Months
Ended
December 31, 2023

Year Ended
December 31,
2023

(in millions)

Constant Currency:

Revenue

$            1,100.3

$            4,254.1

Constant currency adjustment

(0.1)

25.0

Constant currency revenue

$            1,100.2

$            4,279.1

Bookings

$            1,123.9

$            4,603.1

Constant currency adjustment

(4.0)

16.8

Constant currency bookings

$            1,119.9

$            4,619.9

Source: GoDaddy Inc.

© 2024 GoDaddy Inc. All Rights Reserved.

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Asian American Engineer of the Year Award and Conference Announces First Phase of 2025-2026 Awardees

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May 2, 2026

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SANTA CLARA, Calif., May 1, 2026 /PRNewswire/ — The Asian American Engineer of the Year Award (AAEOY) Executive Committee announces the AAEOY 2025-2026 first phase awardees as follows:

Distinguished Lifetime Achievement Award

Mr. Lip-Bu Tan, CEO, Intel Corporation

Distinguished Leadership in Science and Technology Award

Dr. Arun Majumdar, Dean of the Stanford Doerr School of Sustainability, Stanford University

Executive of the Year Award

Dr. Xiaodong Che, Chief Technology Officer, Western DigitalDr. Sam Heidari, CEO, LumotiveDr. Jungwon Lee, Corporate Executive Vice President, Samsung ElectronicsDr. Liu Ren, Vice President & Chief Scientist, Bosch ResearchMr. Brandon Wang, Vice President, Synopsys

Engineer of the Year Award

Ms. Vivian Ye, Principal Member of Technical Staff, AT&T

Most Promising Engineer of the Year Award

Mr. Max Fang, Director of Architecture, AmbarellaMr. Johnny Ho, CSO & Co-founder, Perplexity AI

The AAEOY Award has been presented annually since 2002 as a cornerstone of the National Engineers Week program, honoring distinguished Asian American professionals across academia, public service, and industry. Since its inception, the AAEOY has recognized over 300 honorees — including nine Nobel Laureates, pioneering scholars, prominent corporate executives, and an astronaut — serving as a beacon of inspiration for the global STEM community. After a series of impactful ceremonies nationwide, the 2025-2026 AAEOY Award and Conference returns to the heart of innovation in Silicon Valley at the Santa Clara Convention Center on September 18-19, 2026.

For more information regarding the AAEOY program, awardees, and event registration, please visit www.aaeoy.org.

The Chinese Institute of Engineers in USA (CIE-USA), founded in 1917, is a nonprofit professional organization that promotes science, technology, engineering, and mathematics (STEM); supports professional advancement and leadership development; and recognizes the achievements of Asian American professionals through flagship programs such as the Asian American Engineer of the Year (AAEOY) Awards. One of the oldest and most prestigious Chinese American engineering associations in the United States, CIE-USA has seven regional chapters nationwide and hosts events throughout the year.

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SOURCE AAEOY

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Larry Kellerman, Fermi’s Chief Power Officer and Architect of Its 17 GW Energy Infrastructure, Accepts Board Nomination

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May 2, 2026

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DALLAS, May 1, 2026 /PRNewswire/ — Toby Neugebauer, co-founder and largest shareholder of Fermi America (NASDAQ & LSE: FRMI), today announced that he has nominated Larry Kellerman to join the Fermi Board of Directors. Kellerman, who serves as Chief Power Officer at Fermi America, is the architect of the Company’s 17-gigawatt powered data center campus in Amarillo, Texas — the largest private energy grid in America.

Kellerman is co-founder and Managing Partner of Twenty First Century Utilities and brings more than four decades of power industry and finance expertise to the role. His career spans senior leadership positions at Goldman Sachs, El Paso Corporation, and I Squared Capital. Kellerman said he was honored by the nomination and would be pleased to serve if approved by the Board.

“I appreciate everything that Toby has manifested in Fermi and know that no other human could have created the enterprise and its many thoughtfully interconnected elements as quickly, as effectively, and in as value-accretive a manner as Toby’s leadership has been able to deliver.”
— Larry Kellerman, Chief Power Officer and Board Nominee, Fermi America

For Neugebauer, the choice was crystal clear. Kellerman, who has worked alongside Neugebauer since the earliest days of Project Matador knows Fermi’s power story better than anyone.

“When I came up with the idea of Project Matador, I knew that Larry Kellerman was the one person I needed to convert a really great idea into a really great reality. His knowledge of power and the future of powering data centers is unmatched. Larry is uniquely qualified to steward Fermi as a Board member, and I couldn’t be more pleased with his willingness to serve.”
— Toby Neugebauer, Co-Founder, Fermi America

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SOURCE Toby Neugebauer

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EAST SIDE GAMES GROUP ANNOUNCES NON-BROKERED PRIVATE PLACEMENT OF UNITS TO RAISE UP TO $3.5 MILLION

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May 2, 2026

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VANCOUVER, BC, May 1, 2026 /CNW/ – East Side Games Group (TSX: EAGR) (OTC: EAGRF) (the “Company”), Canada’s leading free-to-play mobile game group, announces a non-brokered private placement of 31,818,182  units (a “Unit”) at $0.11 per Unit (the “Unit Price”), for total gross proceeds of up to $3.5 million. 

Each Unit will be comprised of one common share and one full whole warrant (a “Warrant”).  Each whole Warrant will be exercisable at $0.14 per share (the “Exercise Price”) for a period of three years from issuance. The Warrants will be subject to standard anti-dilution adjustments.

The private placement will be offered in reliance on prospectus exemptions, and any securities sold will be subject to a four month statutory hold period.  The private placement is not anticipated to have any material impact on the control of the Company, nor is it anticipated that any new control persons would be created as a result of the private placement.

It is anticipated that Derek Lew, a director of the Company, will participate in the private placement for an amount of $1.0 million for 9,090,909 Units. As at the date of this news release, Mr. Lew holds 1,667,244 common shares of the Company (2.17%). If the private placement is completed as anticipated, Mr. Lew will hold 10,758,153 common shares (representing 9.89% of the common shares anticipated to be outstanding upon completion of the private placement on a partially diluted basis), 9,090,909 Warrants and 250,000 incentive stock options. Upon exercise of his Warrants, Mr. Lew would own 19,849,062 common shares representing 16.84% of the then issued and outstanding common shares assuming no other share issuances.

The TSX Company Manual requires shareholder approval be obtained  for private placements if the maximum number of common shares issuable under the private placement represents an amount that is more than 25% of the total outstanding common shares as at the date of the press release (pursuant to Section 607(g)). Disinterested shareholder approval must be obtained (excluding those shareholders participating in this private placement and their associates and affiliates) if the number of common shares issued and issuable to insiders under a private placement exceeds 10% of the Company’s issued and outstanding common shares as of the date hereof (pursuant to Section 607(g)(ii)).

As: (a) the private placement is for up to 31,818,182 Units (being equivalent to 41.35% of the Company’s outstanding shares as at the date of this press release), (b) Mr. Lew’s subscription for 9,090,909 Units represents an amount that is equivalent to 11.81% of the Company’s outstanding shares as at the date of this press release, and (c) the Warrants comprising the Units have an exercise price of $0.14 per share (and the five day VWAP is $0.144 per share), the Company has obtained written consent from Jason Bailey, the Company’s CEO and a director, in support of the private placement in accordance with Section 604(d) of the TSX Company Manual.  Mr. Bailey holds more than 50% of the Company’s outstanding shares as at the date of this press release.

The net proceeds from the private placement will be used to repay indebtedness owing to the Royal Bank of Canada (RBC) and for operating expenses and general working capital. Mr. Bailey commented, “With this funding in place, we are on solid footing to continue our disciplined approach to completing the business’s turnaround. With our core portfolio of well performing titles, we have a solid foundation to rebuild upon. We feel we have a strong runway, pipeline and team to execute toward a positive 2026,” [and] “I’d like to thank our existing shareholders for their support and guidance through a difficult 2025 and look forward to achieving the results that will allow this Company, our capital markets strategy and employees to reach its potential.”

The Company’s board of directors considers the private placement to be in the best interests of its shareholders, after having taken into account other alternative forms of financing.  In the course of its review, the Company considered other replacement debt financing, the Company’s ongoing cashflow from operations, as well as ongoing operating expenses, one-off necessary expenditures and the Company’s debt load, within the larger context of the analysis detailed in its press release dated March 31, 2026 as to the re-orienting of the Company’s overall business strategy. 

The Company anticipates that the private placement will close on or before May 8, 2026, subject to acceptance by the TSX.

The Company reserves the right to pay finder’s fees in the form of common shares (in lieu of cash fees) and broker warrants to arm’s length finders in connection with the private placement to arm’s length parties, in accordance with TSX policies. No finder’s fee will be paid to any non-arm’s length parties, nor with respect to subscriptions from non-arm’s length parties.  A maximum number of 1,363,636 common shares (to be issued at $0.11 per share for a total value of $150,000) and a maximum number of 1,254,545 broker warrants will be issuable, assuming the private placement is fully subscribed.  Each broker warrant will entitle the holder to acquire one common share at $0.14 per common share (the “Broker Warrant Exercise Price”) for a period of three years form issuance.  

The maximum number of securities issuable under the private placement is 66,254,545 common shares, comprising 31,818,182 common shares comprising the Units, 31,818,182 common shares issuable upon exercise of the Warrants, 1,363,636 common shares to be issued as finder’s fees, and 1,254,545 common shares issuable upon exercise of the broker warrants, which represents an amount equivalent to 86.10% of the total outstanding common shares as at the date of this press release on a non-diluted basis, without taking into effect the private placement itself, or approximately 46.27% of the Company’s total issued and outstanding common shares following completion of the private placement (being 143,200,825 shares anticipated to be outstanding on a partially diluted basis, assuming the private placement is fully subscribed, full issuance of the finder’s fee shares and full exercise of the Warrants and broker warrants). The Unit Price represents a 22% discount to the Company’s five-day volume-weighted trading price of its common shares on the TSX as at the time of submitting the Company’s application to TSX (the “Market Price”). Market Price and the Exercise Price and the Broker Warrant Exercise Price represent a 2.47% discount to the Market Price.

The total number of common shares expected to be issued to insider (Mr. Lew) under the private placement is 18,181,818 (consisting of 9,090,909 common shares and 9,090,909 common shares issuable upon full exercise of Warrants), representing 23.63% of the total outstanding common shares as at the date of this press release on a non-diluted basis, without taking into effect the private placement itself, or 12.70% of the Company’s total issued and outstanding common shares following completion of the private placement (being 143,200,825 shares anticipated to be outstanding on a partially diluted basis, assuming the private placement is fully subscribed, full issuance of the finder’s fee shares and full exercise of the Warrants and the broker warrants).

This press release does not constitute an offer to sell or a solicitation of an offer to buy any securities in the United States.  The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), or any state securities laws, and may not be offered or sold within the United states or to U.S. persons unless registered under the U.S. Securities Act and applicable state securities laws, or an exemption from such registration is available.

ABOUT EAST SIDE GAMES GROUP

ESGG is a leader in free-to-play mobile gaming, thrilling players with unforgettable experiences that spark lifelong fandom. Fueled by an entrepreneurial spirit, we are driven by creativity, flawless execution, and a laser-focused strategy. We develop and publish both original and licensed IP titles, license our cutting-edge GameKit(s) platforms, and strategically acquire studios or games to expand our family.

Headquartered in Vancouver with around 100 talent-dense team members, we operate over a dozen titles under East Side Games (“ESG”) and LDRLY (Technologies) Inc. (“LDRLY”). Together, we’re crafting, launching, and publishing mobile games across our own studios and an extended Game Kit partner network-reaching players on iOS and Android worldwide.

We power our success through in-app purchases (“IAP”) — offering exclusive, game-enhancing virtual items — and in-game advertising. To keep growing, we focus on captivating audiences, keeping them engaged, and unlocking exciting new ways to monetize. We’ll drive this momentum by launching bold new titles, enriching our current lineup, innovating discovery, expanding into fresh markets, and exploring new distribution platforms.

Additional information about the Company continues to be available under its legal name, East Side Games Group Inc., at www.sedarplus.ca.

Forward-looking Information

Certain statements in this news release constitute forward-looking information or forward-looking statements within the meaning of applicable securities laws. Forward-looking statements are often, but not always, identified by the use of words such as “expects,” “anticipates,” “plans,” “intends,” “believes,” “estimates,” “projects,” “may,” “will,” “would,” “could,” “should,” and similar expressions. Forward-looking statements in this news release include, without limitation, statements regarding the proposed private placement.

Forward-looking statements are based on management’s current expectations, estimates, projections and assumptions. Such forward-looking statements are subject to significant risks, uncertainties and other factors that could cause actual results or events to differ materially from those expressed or implied by such statements, including, without limitation, risks relating to the Company’s ability to complete the proposed private placement as described, and relating to general economic, market and industry conditions. Readers are cautioned not to place undue reliance on forward-looking statements. The forward-looking statements contained in this news release are made as of the date hereof, and the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

SOURCE East Side Games Group Inc.

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