Reglikedomain industry desk

$25-$30 million revenue hit in Q2 due to Covid-19 — Godaddy expects

$25-$30 million revenue hit in Q2 due to Covid-19 — Godaddy expects

Domain name aftermarket might be a weak spot during the downturn.

Graph showing U.S. government data on business establishments over time

GoDaddy held a virtual investor day yesterday and the impact of Covid-19 was obviously a discussion topic.

Ray Winborne, CFO of GoDaddy, stated the pandemic had a minimal impact on Q1 and that revenue would land within $5 million of the firm’s $795 million guidance.

The impact will be greater in the second quarter, during which GoDaddy expects regarding a $25-$30 million impact.

The firm expects no significant changes to its core business, which is based primarily on renewals. It expects mild softness in fresh sales.

There will be two drags, still. First, having everyone work from home will impact employee productivity. Second, the aftermarket is likely to see a greater demand impact in a recession due to higher price points.

GoDaddy showed a chart (picture) with data from the U.S. government regarding fresh business starts, counting during the Great Recession. Although it shows that people still start businesses in recessions, the firm noted that the impact of Covid-19 is unique since it’s hard to predict the recovery shape and window.

The full investor presentation is here (pdf).

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