Wall Street Is Losing Confidence in GoDaddy’s (GDDY) AI Strategy. Should Investors?

2 weeks ago 34

Jabran Kundi

Sat, August 8, 2026 astatine 8:06 AM CDT 3 min read

GoDaddy Inc. (NYSE:GDDY) bushed statement estimates connected some gross and earnings, but that wasn't capable to forestall the banal from dropping 12%. The market's absorption makes it wide that investors are paying much attraction to the company's aboriginal outlook than its caller results. This is not a communicative astir an net miss. The existent question is whether GoDaddy's enlargement into agentic AI products is simply a strategical determination to reenforce its semipermanent business, oregon whether it reflects increasing unit from AI connected its halfway business.

Wall Street Is Losing Confidence successful GoDaddy's (GDDY) AI Strategy. Should Investors?

Bookings Deceleration Raised Red Flags

The institution reported quarterly net of $1.83 per share, exceeding the statement estimation by $0.14 portion gross roseate 7% twelvemonth implicit twelvemonth to astir $1.30 billion. Total bookings besides accrued 6% to $1.4 billion. However, Wells Fargo expert Alec Brondolo highlighted that Applications and Commerce bookings maturation slowed to 7% twelvemonth implicit twelvemonth from 9% successful the erstwhile quarter. He said the slowdown reflects increasing user request for agentic AI products.

In response, absorption is accelerating the motorboat of its Airo AI level portion reducing concern successful bequest Applications and Commerce offerings. Analyst Alec Brondolo warned that this modulation is apt to stay noisy passim the 2nd fractional of 2026 and into 2027. Reflecting those concerns, William Blair expert Arjun Bhatia downgraded the banal from Outperform to Market Perform. Piper Sandler besides maintained its Neutral rating, saying it inactive sees nary wide catalyst for gross maturation to reaccelerate. The institution besides expects third-quarter gross to scope from $1.32 cardinal to $1.34 billion.

William Blair expert Arjun Bhatia remarked:

Investors had already enactment GoDaddy successful the high-risk handbasket of the AI disruption commercialized anterior to earnings, and the show this 4th is apt to further substance fears and measurement connected shares successful the adjacent term.

The Bull Case Hasn't Disappeared

Despite concerns implicit slowing bookings growth, bulls reason that GoDaddy Inc. (NYSE:GDDY) continues to execute good connected its AI strategy. Airo's annualized bookings tally complaint surged 5x successful a azygous 4th to $50 million, with CEO Amanpal Bhutani stating that adoption is exceeding expectations. The institution besides delivered stronger profitability. Its normalized EBITDA borderline expanded by much than 200 ground points to 33%, portion escaped currency travel reached $443 million. Shareholder returns remained different agleam spot, arsenic GoDaddy repurchased $852 cardinal worthy of shares twelvemonth to date, lowering its stock number by 7%.

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