GoDaddy's AI Revolution: A Hidden Gem in the SMB Tech Arena

In an era where artificial intelligence (AI) is reshaping industries, few companies are better positioned to capitalize on the $200 billion SMB software market than
(GDDY). Under CEO Vinod Suresh's leadership, the company has undergone a cultural and technological metamorphosis, leveraging rapid experimentation and customer-centric AI tools like GoDaddy Airo to dominate the small-business digital enablement space. This article argues that GoDaddy is an underappreciated investment opportunity—a stock poised to surge as mainstream recognition catches up with its strategic brilliance.
The Leadership Edge: Rapid Experimentation and a Culture of Learning
Vinod Suresh, GoDaddy's CEO since 2021, has transformed the company from a domain registrar into a full-stack SMB tech ecosystem. His mantra—“fail fast, learn faster”—fuels a culture of 20–30 experiments/month, ensuring GoDaddy stays ahead of competitors like
and AWS. This agility is reflected in Airo's evolution: from a basic website builder to an AI-powered suite offering logo design, email marketing, SEO optimization, and even LLC formation.The GoDaddy Agency Program, launched in 2024, exemplifies this strategy. By connecting SMBs with digital agencies, GoDaddy expands its reach into vertical-specific solutions (e.g., e-commerce, local services) while shielding itself from direct competition with AWS's broader SMB tools. This focus on agentic AI—where AI agents autonomously handle cross-product tasks—creates a sticky ecosystem that small businesses cannot easily abandon.
Subscription Growth: Scalability Meets Customer Retention
GoDaddy's subscription model is its crown jewel. The Applications & Commerce (A&C) segment, which includes Airo and domain services, grew 17% YoY in Q1 2025 to $446 million, driven by Airo's ability to increase attachment rates (the number of products per customer). Early data shows customers using Airo attach 2–3 additional products (e.g., email, security, payments), boosting trailing-12-month ARPU by 9% to $225. With 85% retention, GoDaddy's flywheel of cross-selling is self-sustaining.
Patent-Pending Tech Barriers: A Moat Against Competitors
GoDaddy's AI agents—patent-pending systems that automate tasks across its ecosystem—are its most formidable defense. Unlike generic AI tools, Airo's agents specialize in SMB workflows: generating localized marketing content, flagging operational risks, and optimizing SEO in real time. For example, Airo's “Coming Soon” pages convert 28% more sales than DIY sites, a metric that underscores its value proposition.
The integration of Microsoft 365 for professional email and Payable Domains for seamless transactions further deepens the moat. Competitors like Squarespace lack this holistic approach, while AWS focuses on broader enterprise needs. GoDaddy's vertical-specific AI—tailored for local businesses, freelancers, and niche retailers—is a defensible niche.
Cultural Shift: Why SMBs Stick with GoDaddy
SMBs are not just buying software; they're adopting a technology partner. Airo's simplicity—no coding required to build a website or run ads—eliminates friction for non-technical users. Case studies like Katie West's The Grand Lady, who scaled her business using Airo's automated marketing tools, highlight the platform's democratizing power.
The “Power Your Future” campaign (featuring a Super Bowl ad) reinforces GoDaddy's brand as the SMB's ally. This emotional connection, paired with 24/7 support, ensures loyalty even as competitors launch similar tools.
Risks and the Case for Action
GoDaddy is not without challenges. AI adoption timelines remain uncertain, and macroeconomic headwinds could delay SMB spending. Competitors like AWS and
are also investing in SMB AI tools, though GoDaddy's SMB-first focus mitigates this risk.Yet, the data is compelling:
- Q1 2025 free cash flow (FCF) rose 26% to $411 million, fueled by Airo's margins.
- $1.5 billion buyback program signals confidence in long-term value.
Investment Thesis: Act Before the Crowd
GoDaddy is an underappreciated AI-for-SMB play. Its subscription-driven model, sticky ecosystem, and leadership in SMB-specific AI position it to outperform as AI adoption accelerates. With a forward P/E of 15x (below peers like Shopify at 22x), the stock offers growth at a reasonable price.
Investors should act now:
- Buy GDDY for exposure to the SMB tech boom.
- Set a target price of $55+ based on A&C growth and FCF expansion.
- Monitor Airo Plus adoption—a premium tier with AI analytics could unlock $100 million+ in annual revenue by 2026.
In conclusion, GoDaddy's blend of AI innovation, SMB-centric design, and operational discipline makes it a rare gem in a crowded tech landscape. This is a stock set to shine as the world's 430 million small businesses digitize—and investors would be wise to stake their claim before the spotlight arrives.
Ask Aime: Should I buy GoDaddy (GDDY) stock now?
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