GoDaddy Inc.

Good afternoon. My name is Chris and I'll be your conference operator today. At this time, I would like to welcome everyone to GoDaddy Q4 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, simply press star followed by the number one on your telephone keypad. If you'd like to withdraw your question, press the pound key. Thank you. Sam Kemp, Vice President of Investor Relations and Strategy. You may begin your conference.

Good afternoon, and thank you for joining us for GoDaddy's fourth quarter and full year 2018 earnings call. With me today are Scott Wagner, Chief Executive Officer, and Ray Winborn, Chief Financial Officer. Scott and Ray will share some prepared remarks, and then we'll open up the call for your questions. On today's call, we'll be referencing both GAAP and non-GAAP financial results and operating metrics such as total bookings, unlevered free cash flow, net debt, and ARPU. A discussion of why we use non-GAAP financial measures and reconciliations of our non-GAAP financial measures to their GAAP equivalents may be found in the presentation posted to our Investor Relations website at investors.godaddy.net or on our Form 8K, File of the SEC, with today's earnings release. Unless otherwise stated, when we refer to organic measures, we're referring to those measures excluding the impact of HEG and Main Street Hub. The matters we'll be discussing today include forward-looking statements, which include those related to our future financial results, new product introductions and innovations, or our ability to integrate recent acquisitions and achieve desired synergies, including our recent acquisition of Main Street Hub. These forward-looking statements are subject to risks and uncertainties that are discussed in detail in our documents filed with the SEC. Actual results may differ materially from statements that we make on this call and are based on assumptions as of today, February 20, 2019, and we undertake no obligation to update these statements as a result of new information or future events. With that, here's Scott.

Thanks, Sam, and thanks to everyone for joining us today to discuss our fourth quarter and full year 2018 results. We finished 2018 on a strong note, and not just on our financials, but also in the experiences and products enabling our customers to make the world they want. GoDaddy is the best place to power an online presence, and that shows up in our results. In 2018, we grew revenue 19%, drove 25% growth in our unlevered free cash flow, and added over 1 million customers, all affirming the importance of GoDaddy to everyday entrepreneurs all around the globe. Today we'll spend time on three topics. First, the customer and product experience improvements we made in 2018 and where we're headed in 2019. Second, an update on our go-to-market engine and how we're taking the next steps in our brand to draw closer to the global community of everyday entrepreneurs. And finally, Ray will cover our fourth quarter performance and outlook for 2019. In 2018, we put our shoulder into both our product and customer experience. which is a large unlock in our business as we expand the role GoDaddy plays in our customers' lives. Each quarter, you've heard us highlight GoCentral's expanding feature set and consistently improving metrics. If you zoom out, in 2017, we launched this product as an easy-to-use website building tool. In 2018, we took that strong foundation and integrated it across a dozen relevant third-party platforms and added a number of product functions that are seeing dramatic growth in usage. We've entered 2019 with a platform that enables everyday entrepreneurs to create robust websites and syndicate marketing across the social, reputation, and e-commerce landscape. If you haven't used Go Central recently, I'd really encourage you to give it a spin so you can see all that it does and how much more we're doing to help our customers succeed online. Combined with our award-winning care, Go Central is something that is a powerful resource and uniquely GoDaddy. And while Go Central is our flagship DIY website building product, we've also made substantial improvements in our WordPress offerings, especially within our managed WordPress application. WordPress is important to many of our customers who want greater flexibility and customization. A third of the internet is already built using the WordPress framework and we're continuing to take share of that growing environment, making GoDaddy the largest host of paid WordPress instances in the world by the end of 2018. Our managed WordPress offering automates the entire process of starting and maintaining a secure WordPress website, which saves our customers literally hours of work, frustration, and distraction. These two applications live alongside each other in our suite of presence offerings and address complementary need states. Taken together, they're growing subscriptions more than 40% year over year, a clear affirmation that what we're doing there is working. Go Central and Managed WordPress have seen robust growth and have been key to the sustained growth rates you're seeing in our billion-dollar hosting and presence segment. We're also doing more for our customers within the broader product suite beyond just websites and marketing. We've added a new complimentary email platform through our partnership with Open Exchange to better address the needs of emerging and price-sensitive markets, making it a great complement to Microsoft O365 offerings in mature markets. For example, in Mexico, we're now able to provide an email seat for about a buck and a half a month, making it a valuable product at a value price point. Much of our effort outside of launching specific products and features in 2018 was about simplifying our customer experience from how we market to how we welcome and onboard new users to how we wow them with support and care. As a result of a lot of heavy lifting behind the scenes, our Net Promoter Score, or NPS, improved dramatically over the past year, which on a business of our scale is meaningful. We'll be putting more effort into simplifying and unifying our experiences in 2019. On my second major point about go-to-market, GoDaddy already commands very strong brand awareness. And in 2019, we're building on the brand to more deeply identify with the daily journey of the everyday entrepreneur and to activate the community that already exists within GoDaddy today. You'll see this in our imagery, the content that we produce in the market, and the way that we reach our audience. Ultimately, where we're headed is a brand promise that can support the expansion of what we do for our customers with the tools and services we offer today and the products we'll deliver over the next several years. Tactically, this is starting in the U.S. It is being borne out by six iconic influencers that are emblematic of our customers and who've built their online presence with GoDaddy. For example, on February 8th, we proudly launched one of those iconic influencers, Aisha Curry, and her new homemade brand. over the life of this campaign will generate the same viewership as the Super Bowl ads we've been historically known for, but in a cost-effective and far more targeted manner. Beyond our six cornerstone icons, we're also building out a network of hundreds of vertical-specific influencers who are revered in their trade and advocates of our brand. The reality is that GoDaddy's customer base has always been diverse. And this strategy is allowing us to reach our target audience with a message that is as relevant to someone in New Jersey as it is in Topeka, Kansas, as someone in Manchester, England, delivered more nimbly and in a sustained, ongoing conversation. In shifting to conversations and conversational marketing, we made a ton of progress this year in how we talk to our existing customers, and we're hitting our objectives in terms of scaling campaigns with returns above our efficiency thresholds. We're seeing benefits in our ability to attach new products, drive feature engagement, and find instances where there is a shifted underlying needs state that we can better serve. Right now, we have abundance of opportunities in conversational marketing, and we hope to put 10% of our 2019 go-to-market budget on the field in this channel. Before I hand it off to Ray, I'd like to welcome a new face to our team and to highlight some changes to our organization. First, we've welcomed Farah Howard as our Chief Marketing Officer. Farrah has an ocean of experience from her time at Amazon Fashion, Dell, and Vans, and she's going to be responsible for stewarding our brand and overseeing day-to-day market activities. We've also continued to evolve our management structure. First, Andrew Loakey added customer care to his broader go-to-market responsibilities under the new title of Chief Operating Officer, which is uniting the end-to-end customer lifecycle from acquisition to support. We're bringing our technology and infrastructure operations under CTO Charles Biedenhall, which is a natural progression of our technology strategy and execution ability. Finally, our products are seeing good success today, and as we look to the mid to long term, we've begun the process of identifying our next head of product experience who can oversee the transition of our products to an integrated experience for our customers. Stepping back, we've entered 2019 with wind at our back, delivering on our financial objectives, and laying the right foundation for multi-year growth. With that, here's Ray to cover our financials.