Domain name aftermarket might be a weak spot during the downturn.
GoDaddy held a virtual investor day yesterday and the impact of Covid-19 was obviously a discussion topic.
Ray Winborne, CFO of GoDaddy, said the pandemic had a minimal impact on Q1 and that revenue would land within $5 million of the company’s $795 million guidance.
The impact will be greater in the second quarter, during which GoDaddy expects about a $25-$30 million impact.
The company expects no significant changes to its core business, which is based primarily on renewals. It expects mild softness in new sales.
There will be two drags, however. 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 about new business starts, including during the Great Recession. Although it shows that people still start businesses in recessions, the company noted that the impact of Covid-19 is unique because it’s hard to predict the recovery shape and window.
The full investor presentation is here (pdf).