Company getting early results from domain name portfolio.
GoDaddy released its Q3 earnings yesterday, and its 10-Q filing with the SEC gives some insight into how it is doing with the Marchex domain name portfolio.
The company paid $28.1 million to acquire the portfolio of about 200,000 domain names in April.
It’s also paying an earn-out. GoDaddy acquired three companies this year and discloses in its 10-Q that it recognized a liability of $0.9 million for earn-outs from these acquisitions. It’s possible that this is just for the Marchex deal, making it a $29.0 million targeted acquisition price.
In Q2, GoDaddy reported selling $1.2 million from the portfolio. In Q3 is reported $1.4 million in sales. I believe the Q2 number includes sales that occurred prior to the acquisition in Q2.
At any rate, these seem like solid sales numbers for a domain name portfolio at this valuation. (GoDaddy put the portfolio on its books at $26.5 million.)
I’m curious if the quarterly sales will increase or decrease over time. It’s possible we will see a short-term increase in sales numbers, and then a decrease in the long run. The short term bump will be due to GoDaddy getting all of its domains priced, and selling domains to people who couldn’t strike a deal at Marchex’s abnormally high pricing. In the long run, as the low hanging fruit is picked, you’d expect quarterly sales to drop.