GoDaddy (GDDY) risk factors, FY2024 10-K

Strategic Risks

1. 01If we are unable to attract and retain customers and increase sales to new and existing customers, our business and operating results would be harmed
2. 02If we do not successfully develop and market products that anticipate or respond timely to the needs of our customers, our business and operating results may suffer
3. 03device to our line of GoDaddy Smart Terminals and providing on-the-go solutions such as Tap-to-Pay in the GoDaddy Mobile App, Pay Links and Virtual Terminal
4. 04The use of new and evolving technologies, such as AI, in our offerings may result in reputational harm and liability
5. 05Evolving technologies and administration of the Internet, and the resulting changes in customer behavior and customer practices may impact the value of and demand for our products, including domain names and our websites
6. 06We face significant competition for our products, which we expect will continue to intensify, and we may not be able to maintain or improve our competitive position or market share
7. 07Our pricing decisions may adversely affect our ability to attract and retain customers
8. 08The future growth of our business depends in part on increasing our international revenue. Our continued international presence could subject us to additional risks
9. 09Acquisitions and other strategic transactions, including investments or entries into new businesses, joint ventures, divestitures or other transactions, could require significant management attention, disrupt our business, dilute stockholder value and adversely affect our operating results
10. 10Our company's culture has contributed to our success, and if we cannot maintain this culture as we grow, we could lose the innovation, creativity, passion and teamwork that we believe contribute to our success and our business may be harmed

Operational Risks

1. 11We are exposed to the risk of system failures and capacity constraints
2. 12We substantially rely upon AWS to operate our integrated platform, and any disruption of or interference with our use of AWS would adversely affect our business, results of operations and financial condition
3. 13An actual or perceived cybersecurity incident could impair our ability to conduct business, provide our products and services, protect data, and comply with contractual or legal obligations, and may cause us to incur substantial costs, or subject us to significant liability
4. 14If we experience fraudulent activity relating to our, or our third-party vendors’ products and services, we could suffer service interruptions or incur substantial costs
5. 15We rely on our marketing efforts and channels to maintain awareness of our brand and acquire new customers. These efforts may require significant expense and may not be successful
6. 16Our ability to increase sales of our products is highly dependent on the quality of our customer care. Our failure to provide high-quality customer care would have an adverse effect on our business, brand and operating results
7. 17A portion of our GoDaddy Guides is engaged through third parties and not directly by us
8. 18If we are unable to maintain our contractual relationships with existing partners or establish new contractual relationships with potential partners, we may not be able to offer the products and related functionality our customers expect
9. 19We are dependent on the reliability, security and performance of our internally developed systems and operations. Any difficulties in maintaining these systems may result in damage to our brand, service interruptions, decreased customer service or increased expenditures
10. 20Our business is exposed to risks associated with credit card and other payment chargebacks, fraud and new payment methods
11. 21Our future performance depends in part on the services and performance of our senior management, as well as key employees. If we are unable to attract, motivate, and retain our employees, our business could suffer
12. 22In addition, as we expand our product offerings through acquisitions, we may become dependent on the key personnel who join us through such acquisitions. If we are unable to successfully integrate and retain such personnel, our financial condition and operating results may be adversely affected

Financial Risks

1. 23Our quarterly and annual operating results may be adversely affected due to a variety of factors, which could make our future results difficult to predict and could cause our operating results to fall below investor or analyst expectations
2. 24We may not be able to maintain profitability in the future
3. 25Because we are generally required to recognize revenue for our products over the term of the applicable agreement, changes in our sales may not be immediately reflected in our operating results
4. 26Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our operating results and financial condition
5. 27In addition, we may be subject to audits of our income, sales and other transaction taxes by federal and state and foreign tax authorities. Outcomes from these audits could have an adverse effect on our operating results and financial condition
6. 28The agreements governing our indebtedness impose significant operating and financial restrictions on us and our subsidiaries, which may prevent us from capitalizing on business opportunities and making payments on our indebtedness
7. 29We may need additional equity, debt or other financing in the future, which we may not be able to obtain on acceptable terms, or at all, and any additional financing may result in restrictions on our operations or substantial dilution to our stockholders
8. 30We may be required to repurchase the Senior Notes and the maturity of our Credit Facility may be accelerated upon a change of control triggering event

Legal and Regulatory Risks

1. 31Laws, regulations, policies or claims concerning the domain name registration system and the Internet in general, and industry reactions to those policies or claims, may cause instability in the industry and disrupt our business
2. 32ICANN periodically authorizes the introduction of new TLDs. A delay in access to new TLDs could adversely impact our business, results of operations and reputation
3. 33The relevant domain name registry and ICANN impose a charge upon each registrar for the administration of each domain name registration. If these fees increase, it would have a significant impact upon our operating results
4. 34We are subject to local and international laws, rules, regulations, and orders relating to the operation and security of our computer network and the processing of data, including privacy of personal data
5. 35We are subject to international laws, rules and regulations relating to content moderation
6. 36Activities of customers or the content of their websites could damage our reputation and brand or harm our business and financial results
7. 37Our business could be affected by new governmental regulations regarding the Internet
8. 38From time to time, we are involved in lawsuits, including class action lawsuits, which are expensive and time consuming and could adversely affect our business, financial condition and results of operations
9. 39Failure to adequately protect and enforce our intellectual property rights could substantially harm our business and operating results
10. 40We are involved in intellectual property claims and litigation asserted by third parties and may be subject to additional claims and litigation in the future, which could result in significant costs and substantial harm to our business and results of operations
11. 41We may face liability or become involved in disputes over registration and transfer of domain names and control over websites
12. 42Our use of open source technology could impose limitations on our ability to commercialize our products
13. 43We are subject to certain export controls, including economic and trade sanctions regulations that could impair our ability to compete in international markets and subject us to liability if we are not in full compliance with applicable laws
14. 44Due to the global nature of our business, we could be adversely affected by violations of anti-bribery and anti-corruption laws
15. 45Changes in taxation laws, rules and regulations may discourage the registration or renewal of domain names for e-commerce
16. 46GoDaddy Payments' risk management efforts may not be effective, and we could be exposed to substantial losses and liability which could substantially harm our business

Risks Related to Owning our Class A Common Stock

1. 47Our share price may be volatile, and you may lose all or part of your investment
2. 48Provisions of our charter, bylaws and Delaware law may have anti-takeover effects that could prevent a change in control of the company even if the change in control would be beneficial to our stockholders
3. 49Our bylaws designate the Court of Chancery of the State of Delaware as the exclusive forum for certain litigation that may be initiated by our stockholders, which could limit our stockholders' ability to obtain a favorable judicial form for disputes with us
4. 50We currently do not intend to pay dividends on our Class A common stock
5. 51We cannot guarantee we will make any additional repurchases of our Class A common stock

Other Risks

1. 52Economic conditions in the U.S. and international economies may adversely impact our business and operating results
2. 53Reporting requirements for which we must comply may continue to increase our costs, become too time-consuming or could divert management's attention, which could adversely affect our business and operating results
3. 54Our business could be negatively impacted by shareholder activism
4. 55Increased scrutiny from investors, regulators and other stakeholders relating to environmental, social and governance issues could result in additional costs for us and may adversely impact our reputation
5. 56Our business is subject to the risks of earthquakes, fire, power outages, floods and other catastrophic events, whether due to climate change or otherwise, and to interruption by man-made events such as terrorism and civil unrest