Godaddy Inc (NYSE:GDDY) marked its market debut yesterday and even closed the day 30.75% up to $26.15 per share. That’s a respectable initial public offering day, by any measure, but some have been sounding the alarm over the fact that the company has not turned a profit for years.
However, Ingrid Lunden, TechCrunch international editor says in an interview on CNBC, that Godaddy Inc (NYSE:GDDY)’s lack of profit may not be a worry for the Street at the moment.
“The thing about GoDaddy is that it has been around for a long time and yes it is still posting a net loss and it has been for years, but it is decreasing. And that is the thing that I think investors are looking at. Revenues continue to grow. That net loss continues to shrink,” Lunden says.
Godaddy Inc (NYSE:GDDY) had about $1.4 billion in revenue in 2014 but did not have any profit. In fact, the company posted a negative $143 million bottom line last year, smaller than losses in the previous years.
However, it should be noted that Godaddy Inc (NYSE:GDDY) also has not had any profit for the last six years. Since 2012, the company has lost $622 million. This does not worry investors now, Lunden says, enough to scare them away from the stock. The firm has been adding a lot of features to its services and they are shifting their business, she adds, which gives the company new revenue streams.
Recently, the company had a break with Google Inc (NASDAQ:GOOGL) revealed that they will not be aggressively pursuing a web domain registration service that would directly compete with GoDaddy.
Meanwhile, Lunden says that the controversial advertisements of the web company may still have helped it gain brand recognition. Any press is good press, she says.
Understandably, there will be a lot of Godaddy Inc (NYSE:GDDY) haters given the nature of some of the advertisements of the company, Lunden says. However, the market is not really that sympathetic with those sentiments of the broader public, she adds. What Wall Street is focusing on is the growing numbers of the company, she explains.
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