GODADDY INC., 10-Q filed on 5/6/2016
Quarterly Report
Document and Entity Information Document
3 Months Ended
Mar. 31, 2016
Apr. 29, 2016
Class A Common Stock
Apr. 29, 2016
Class B Common Stock
Document Information [Line Items]
 
 
 
Entity Registrant Name
GoDaddy Inc. 
 
 
Entity Central Index Key
0001609711 
 
 
Current Fiscal Year End Date
--12-31 
 
 
Entity Filer Category
Accelerated Filer 
 
 
Document Type
10-Q 
 
 
Document Period End Date
Mar. 31, 2016 
 
 
Document Fiscal Year Focus
2016 
 
 
Document Fiscal Period Focus
Q1 
 
 
Amendment Flag
false 
 
 
Entity Common Stock, Shares Outstanding
 
81,236,615 
79,331,269 
Condensed Consolidated Balance Sheets (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Current assets:
 
 
Cash and cash equivalents
$ 431.7 
$ 348.0 
Short-term investments
8.4 
4.5 
Accounts and other receivables
6.1 
4.8 
Registry deposits
25.4 
18.7 
Prepaid domain name registry fees
306.2 
292.6 
Prepaid expenses and other current assets
34.0 
25.3 
Total current assets
811.8 
693.9 
Property and equipment, net
223.8 
225.0 
Prepaid domain name registry fees, net of current portion
169.7 
163.7 
Goodwill
1,663.4 
1,663.4 
Intangible assets, net
711.4 
735.3 
Other assets
10.5 
12.1 
Deferred tax assets
6.2 
5.4 
Total assets
3,596.8 
3,498.8 
Current liabilities:
 
 
Accounts payable
60.9 
39.4 
Accrued expenses and other current liabilities
126.1 
127.0 
Payable to related parties for tax distributions
5.8 
5.3 
Payable to related parties pursuant to tax receivable agreements
3.6 
0 
Deferred revenue
994.2 
937.7 
Long-term debt
4.2 
4.2 
Total current liabilities
1,194.8 
1,113.6 
Deferred revenue, net of current portion
504.3 
478.5 
Long-term debt, net of current portion
1,038.7 
1,039.8 
Payable to related parties pursuant to tax receivable agreements, net of current portion
152.6 
151.6 
Other long-term liabilities
32.1 
34.3 
Commitments and contingencies
   
   
Stockholders' equity:
 
 
Preferred stock, $0.001 par value - 50,000 shares authorized; none issued and outstanding
0 
0 
Additional paid-in capital
477.9 
454.6 
Accumulated deficit
(42.7)
(32.2)
Accumulated other comprehensive income
1.4 
3.2 
Total stockholders' equity attributable to GoDaddy Inc.
436.8 
425.8 
Non-controlling interests
237.5 
255.2 
Total stockholders' equity
674.3 
681.0 
Total liabilities and stockholders' equity
3,596.8 
3,498.8 
Class A Common Stock
 
 
Stockholders' equity:
 
 
Common stock
0.1 
0.1 
Class B Common Stock
 
 
Stockholders' equity:
 
 
Common stock
$ 0.1 
$ 0.1 
Condensed Consolidated Balance Sheets Parenthetical (USD $)
Mar. 31, 2016
Dec. 31, 2015
Preferred stock par value (in dollars per share)
$ 0.001 
$ 0.001 
Preferred stock shares authorized (in shares)
50,000,000 
50,000,000 
Preferred stock shares issued (in shares)
0 
0 
Preferred stock outstanding (in shares)
0 
0 
Common stock outstanding (in shares)
158,170,000 
157,481,000 
Class A Common Stock
 
 
Par value (in dollars per share)
$ 0.001 
$ 0.001 
Common stock shares authorized (in shares)
1,000,000,000 
1,000,000,000 
Common stock shares issued (in shares)
68,363,000 
67,083,000 
Common stock outstanding (in shares)
68,363,000 
67,083,000 
Class B Common Stock
 
 
Par value (in dollars per share)
$ 0.001 
$ 0.001 
Common stock shares authorized (in shares)
500,000,000 
500,000,000 
Common stock shares issued (in shares)
89,807,000 
90,398,000 
Common stock outstanding (in shares)
89,807,000 
90,398,000 
Condensed Consolidated Statements of Operations (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Mar. 31, 2016
Technology and development
Mar. 31, 2015
Technology and development
Mar. 31, 2016
Marketing and advertising
Mar. 31, 2015
Marketing and advertising
Mar. 31, 2016
Customer care
Mar. 31, 2015
Customer care
Mar. 31, 2016
General and administrative
Mar. 31, 2015
General and administrative
Mar. 31, 2016
Domains
Mar. 31, 2015
Domains
Mar. 31, 2016
Hosting and presence
Mar. 31, 2015
Hosting and presence
Mar. 31, 2016
Business applications
Mar. 31, 2015
Business applications
Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
$ 433.7 
$ 376.3 
 
 
 
 
 
 
 
 
$ 218.9 
$ 199.2 
$ 160.4 
$ 140.2 
$ 54.4 
$ 36.9 
Costs and operating expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cost of revenue (excluding depreciation and amortization)
154.4 1
137.2 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Technology and development
71.7 1
66.9 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Marketing and advertising
57.5 1
50.7 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Customer care
61.7 1
56.7 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
General and administrative
48.2 1
47.9 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
38.9 1
37.4 1
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total costs and operating expenses
432.4 
396.8 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating income (loss)
1.3 
(20.5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest expense
(14.3)
(23.5)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tax receivable agreements liability adjustment
(4.6)
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other income (expense), net
0.7 
0.2 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss before income taxes
(16.9)
(43.8)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(Provision) benefit for income taxes
(1.4)
0.4 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss
(18.3)
(43.4)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Less: net loss attributable to non-controlling interests
(7.8)
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss attributable to GoDaddy Inc.
(10.5)
(43.4)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net loss per share—basic and diluted (in USD per share)
$ (0.15)2
$ (0.34)2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted-average shares outstanding—basic and diluted (in shares)
67,834,000 2
38,826,000 2
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Equity-based compensation expense
 
 
$ 5.5 
$ 3.8 
$ 1.9 
$ 1.3 
$ 0.8 
$ 0.3 
$ 3.8 
$ 3.3 
 
 
 
 
 
 
Condensed Consolidated Statement of Stockholders' Equity Statement (USD $)
In Millions, except Share data in Thousands
Total
USD ($)
Class A Common Stock
Class B Common Stock
Common Stock
Class A Common Stock
USD ($)
Common Stock
Class B Common Stock
USD ($)
Additional Paid-in Capital
USD ($)
Accumulated Deficit
USD ($)
Accumulated Other Comprehensive Income
USD ($)
Non- Controlling Interest
USD ($)
Equity at beginning of period at Dec. 31, 2015
$ 681.0 
 
 
$ 0.1 
$ 0.1 
$ 454.6 
$ (32.2)
$ 3.2 
$ 255.2 
Common stock outstanding (in shares) at Dec. 31, 2015
157,481 
67,083 
90,398 
67,083 
90,398 
 
 
 
 
Net loss
(18.3)
 
 
 
 
 
(10.5)
 
(7.8)
Equity-based compensation expense
12.0 
 
 
 
 
12.0 
 
 
 
Stock option and warrant exercises and other
6.4 
 
 
0 
 
9.5 
 
 
(3.1)
Stock option exercises and other (in shares)
 
 
 
689 
0 
 
 
 
 
Effect of exchanges of LLC Units (in shares)
 
 
 
591 
(591)
 
 
 
 
Effect of exchanges of LLC Units
 
 
 
 
 
1.8 
 
 
(1.8)
Distributions to holders of LLC Units
(5.0)
 
 
 
 
 
 
 
(5.0)
Unrealized loss on foreign currency hedging derivatives
(1.8)
 
 
 
 
 
 
(1.8)
 
Equity at end of period at Mar. 31, 2016
$ 674.3 
 
 
$ 0.1 
$ 0.1 
$ 477.9 
$ (42.7)
$ 1.4 
$ 237.5 
Common stock outstanding (in shares) at Mar. 31, 2016
158,170 
68,363 
89,807 
68,363 
89,807 
 
 
 
 
Condensed Consolidated Statements of Cash Flows (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Statement of Cash Flows [Abstract]
 
 
Net loss
$ (18.3)
$ (43.4)
Adjustments to reconcile net loss to net cash provided by operating activities:
 
 
Depreciation and amortization
38.9 
37.4 
Equity-based compensation
12.0 
8.7 
Other
4.4 
2.3 
Changes in operating assets and liabilities, net of amounts acquired:
 
 
Registry deposits
(6.7)
(0.9)
Prepaid domain name registry fees
(19.6)
(22.0)
Deferred revenue
82.3 
87.0 
Other operating assets and liabilities
12.3 
3.0 
Net cash provided by operating activities
105.3 
72.1 
Investing activities
 
 
Purchases of short-term investments
(3.9)
(1.1)
Maturities of short-term investments
0 
3.0 
Business acquisitions, net of cash acquired
0 
(1.1)
Purchases of property and equipment, excluding improvements
(11.9)
(7.6)
Purchases of leasehold and building improvements
(0.1)
(0.6)
Net cash used in investing activities
(15.9)
(7.4)
Financing activities
 
 
Stock option and warrant exercises and other
6.4 
0.4 
IPO costs
0 
(2.9)
Distributions to holders of LLC Units
(5.1)
0 
Contingent consideration for business acquisitions
(1.5)
0 
Repayment of term loan
(2.8)
(2.8)
Other financing obligations
(2.7)
(1.6)
Net cash used in financing activities
(5.7)
(6.9)
Net increase in cash and cash equivalents
83.7 
57.8 
Cash and cash equivalents, beginning of period
348.0 
139.0 
Cash and cash equivalents, end of period
431.7 
196.8 
Supplemental cash flow information:
 
 
Interest on long-term debt
11.6 
20.6 
Income taxes, net of refunds received
1.1 
0.6 
Supplemental information for non-cash investing and financing activities:
 
 
Accrued capital expenditures, excluding improvements, at period end
7.9 
10.4 
Accrued capital expenditures, leasehold and building improvements, at period end
0.7 
0.5 
Property and equipment acquired under capital leases
$ 0 
$ 2.1 
Organization and Background
Organization and Background
Organization and Background
Description of Business
We are a leading technology provider to small businesses, web design professionals and individuals, delivering simple, easy-to-use cloud-based products and outcome-driven, personalized customer care. We operate the world’s largest domain marketplace and provide website building, hosting and security tools to help customers easily construct and protect their online presence and tackle the rapidly-changing technology landscape. As our customers grow, we provide applications helping them connect to their customers, manage and grow their businesses and get found online.
Organization
We were incorporated on May 28, 2014 for the purpose of facilitating an IPO and other related organizational transactions in order to operate the business of Desert Newco and its subsidiaries. Our IPO was completed on April 7, 2015.
We are the sole managing member of Desert Newco. Although we have a minority economic interest, we have sole voting power in, and control the management of, Desert Newco. As a result, we consolidate Desert Newco's financial results and report a non-controlling interest related to the portion of Desert Newco not owned by us. As of March 31, 2016, we owned approximately 43% of Desert Newco.
Basis of Presentation
Our condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP), and include our accounts and the accounts of our subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation.
We had no material components of other comprehensive income during any of the periods presented. As such, a consolidated statement of comprehensive income (loss) is not presented.
Our interim condensed consolidated financial statements are unaudited. These financial statements have been prepared in accordance with GAAP, and in our opinion, include all adjustments of a normal recurring nature necessary for the fair presentation of the interim periods presented. The results for the three months ended March 31, 2016 are not necessarily indicative of the results to be expected for any subsequent quarter or for the year ending December 31, 2016.
The accompanying financial statements should be read in conjunction with our audited consolidated financial statements and related notes included in our Annual Report on Form 10-K for the year ended December 31, 2015, as amended (2015 Form 10-K).
Prior Period Reclassifications
Reclassifications of certain immaterial prior period amounts have been made to conform to the current period presentation.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions affecting amounts reported in our financial statements. Our more significant estimates include:
•
the determination of the best estimate of selling price of the deliverables included in multiple-deliverable revenue arrangements;
•the fair value of assets acquired and liabilities assumed in business combinations;
•
the assessment of recoverability of long-lived assets, including property and equipment, goodwill and intangible assets;
•the estimated reserve for refunds;
•the estimated useful lives of intangible and depreciable assets;
•the grant date fair value of equity-based awards;
•the recognition, measurement and valuation of current and deferred income taxes;
•the recognition and measurement of amounts payable under tax receivable agreements;
•the recognition and measurement of amounts payable as tax distributions to Desert Newco's owners; and
•the recognition and measurement of loss contingencies, indirect tax liabilities and certain accrued liabilities.
We periodically evaluate these estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results may differ from our estimates.
Segments and Reporting Units
Our chief operating decision maker function is comprised of our Chief Executive Officer and Chief Operating Officer who collectively review financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance for the entire company. Accordingly, we have a single operating segment and reporting unit structure.
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Summary of Significant Accounting Policies
Derivative Financial Instruments
We enter into foreign exchange forward contracts with financial institutions to hedge certain forecasted sales transactions denominated in currencies other than the United States (U.S.) dollar. We designate these forward contracts as cash flow hedges, which are recognized as either assets or liabilities at fair value. We do not hold or issue derivative instruments for speculative or trading purposes. At March 31, 2016, the total notional amount of outstanding contracts was $74.9 million, all having maturities of 12 months or less.
We reflect unrealized gains or losses on the effective portion of a cash flow hedge as a component of accumulated other comprehensive income. Gains and losses, once realized, are recorded as a component of accumulated other comprehensive income and are amortized to revenue over the same period in which the underlying hedged amounts are recognized. Any ineffective portion of gains or losses are recorded as other income (expense), net. Such gains or losses were immaterial during all periods presented. Each period, we evaluate the effectiveness of each of our hedges. As of March 31, 2016, all hedges were considered effective.
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. The framework for measuring fair value provides a three-tier hierarchy prioritizing inputs to valuation techniques used in measuring fair value as follows:
Level 1—Observable inputs such as quoted prices for identical assets or liabilities in active markets;
Level 2—Inputs, other than quoted prices for identical assets or liabilities in active markets, which are observable either directly or indirectly; and
Level 3—Unobservable inputs in which there is little or no market data requiring the reporting entity to develop its own assumptions.
We hold certain assets required to be measured at fair value on a recurring basis. These include reverse repurchase agreements, bank time deposits and certificates of deposit, which are classified as either cash and cash equivalents or short-term investments. We classify these assets within Level 1 or Level 2 because we use either quoted market prices or alternative pricing sources utilizing market observable inputs to determine their fair value, as follows:
 
March 31, 2016
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Reverse repurchase agreements(1)
$
—

 
$
130.0

 
$
—

 
$
130.0

Short-term investments:
 
 
 
 
 
 
 
Certificates of deposit and time deposits
8.4

 
—

 
—

 
8.4

Total assets measured and recorded at fair value
$
8.4

 
$
130.0

 
$
—

 
$
138.4

 
 
(1)
Reverse repurchase agreements include an $80.0 million repurchase agreement with Morgan Stanley, callable with 31 days notice, and a $50.0 million repurchase agreement with Wells Fargo in overnight sweeps.
 
December 31, 2015
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Reverse repurchase agreements(1)
$
—

 
$
40.0

 
$
—

 
$
40.0

Short-term investments:
 
 
 
 
 
 
 
Certificates of deposit
4.5

 
—

 
—

 
4.5

Total assets measured and recorded at fair value
$
4.5

 
$
40.0

 
$
—

 
$
44.5

 
 
(1)
Reverse repurchase agreements include a $40.0 million repurchase agreement with Wells Fargo in overnight sweeps.
We have no other material assets or liabilities measured at fair value on a recurring basis.
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition from contracts with customers. The new standard requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount reflecting the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB approved a one year deferral of the effective date making the new standard effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. The new standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. In March 2016, the FASB amended the principal-versus-agent implementation guidance set forth in the new standard. Among other things, this amendment clarifies that an entity should evaluate whether it is the principal or the agent for each specified good or service promised in a contract with a customer. In April 2016, the FASB amended certain aspects of the new standard related to identifying performance obligations and licensing implementation. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In April 2015, the FASB issued new guidance related to accounting for fees paid in a cloud computing arrangement. The new standard provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The adoption of this guidance on January 1, 2016 did not have a material impact on our consolidated financial statements.
In February 2016, the FASB issued new guidance related to accounting for leases. The new standard requires the recognition of assets and liabilities arising from lease transactions on the balance sheet and the disclosure of key information about leasing arrangements. Accordingly, a lessee will recognize a lease asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation. Both the asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend on the classification of the lease as either a finance or an operating lease. Initial costs directly attributable to negotiating and arranging the lease will be included in the asset. For leases with a term of 12 months or less, a lessee can make an accounting policy election by class of underlying asset to not recognize an asset and corresponding liability. Lessees will also be required to provide additional qualitative and quantitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. These disclosures are intended to supplement the amounts recorded in the financial statements and provide additional information about the nature of an organization’s leasing activities. The new standard is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. In transition, lessees are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The transition guidance also provides specific guidance for sale and leaseback transactions, build-to-suit leases and amounts previously recognized in accordance with the business combinations guidance for leases. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In March 2016, the FASB issued new guidance changing the accounting for certain aspects of share-based payments to employees. The guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis and allows for an employer to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting. In addition, the guidance requires recognition of the income tax effects of awards in the income statement when the awards vest or are settled, thus eliminating additional paid-in capital pools. The guidance is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the timing of our adoption and the impact of this new guidance on our consolidated financial statements.
In March 2016, the FASB issued new guidance clarifying that a change in the counterparty to a derivative instrument designated as a hedging instrument does not, in and of itself, require de-designation of the hedging relationship provided all other hedge accounting criteria continue to be met. The guidance is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption permitted. The adoption of this guidance in the first quarter of 2016 did not have a material impact on our consolidated financial statements.
Intangible Assets
Intangible Assets
Intangible Assets
Intangible assets, net are summarized as follows:
 
March 31, 2016
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
 n/a

 
$
(5.7
)
 
55.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(208.0
)
 
 n/a

 
153.2

Developed technology
210.1

 
(157.9
)
 
 n/a

 
52.2

Trade names
11.2

 
(5.9
)
 
 n/a

 
5.3

Other
1.1

 
(0.9
)
 
 n/a

 
0.2

 
$
1,089.8

 
$
(372.7
)
 
$
(5.7
)
 
$
711.4

 
December 31, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
n/a

 
(3.7
)
 
57.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(196.8
)
 
 n/a

 
164.4

Developed technology
210.1

 
(148.0
)
 
 n/a

 
62.1

Trade names
11.2

 
(5.2
)
 
 n/a

 
6.0

Other
1.1

 
(0.8
)
 
 n/a

 
0.3

 
$
1,089.8

 
$
(350.8
)
 
$
(3.7
)
 
$
735.3


Customer-related intangible assets, developed technology, trade names and other intangible assets have weighted-average useful lives from the date of purchase of 99 months, 64 months, 58 months and 36 months, respectively. Amortization expense was $21.9 million and $24.1 million for the three months ended March 31, 2016 and 2015, respectively. The weighted-average remaining amortization period for amortizable intangible assets was 45 months as of March 31, 2016.
Based on the balance of finite-lived intangible assets at March 31, 2016, expected future amortization expense is as follows:
Year Ending December 31:
 
2016 (remainder of)
$
67.2

2017
52.8

2018
44.6

2019
25.9

2020
20.4

Thereafter
—

 
$
210.9

Equity-Based Compensation Plans
Equity-Based Compensation Plans
Equity-Based Compensation Plans
On March 31, 2015, we adopted the 2015 Equity Incentive Plan (the 2015 Plan) and reserved a total of 10,285 shares of Class A common stock for issuance pursuant to the 2015 Plan. The shares reserved for issuance under the 2015 Plan also include up to 28,133 shares rolled over from the Desert Newco, LLC 2011 Unit Incentive Plan (the 2011 Unit Incentive Plan) and from certain other option plans assumed in connection with acquisitions. On January 1, 2016, in accordance with the automatic increase provisions of the 2015 Plan, an additional 6,299 shares were reserved for issuance pursuant to the 2015 Plan. As of March 31, 2016, 13,290 shares were available for issuance as future awards under the 2015 Plan.
On March 31, 2015, we adopted the 2015 Employee Stock Purchase Plan (the ESPP) and reserved a total of 2,000 shares of Class A common stock for issuance pursuant to the ESPP. On January 1, 2016, in accordance with the automatic increase provisions of the ESPP, an additional 1,000 shares were reserved for issuance pursuant to the ESPP. As of March 31, 2016, 2,325 shares were available for issuance as future awards under the ESPP.
We grant options at exercise prices equal to the fair market value of our Class A common stock on the grant date. We grant both options and restricted stock units (RSUs) vesting solely upon the continued employment of the recipient as well as awards vesting upon the achievement of annual or cumulative financial-based targets coinciding with our fiscal year. We recognize the grant date fair value of equity-based awards as compensation expense over the required service period of each award, taking into account the probability of our achievement of associated performance targets.
The following table summarizes our option activity for the three months ended March 31, 2016:
 
 
Number of
Shares of Class A Common Stock (#)
 
Weighted-
Average
Grant-
Date Fair
Value ($)
 
Weighted-
Average
Exercise
Price ($)
Outstanding at December 31, 2015
 
27,419

 
 
 
10.25

Granted
 
1,266

 
11.68

 
29.96

Exercised
 
(663
)
 
 
 
10.43

Forfeited
 
(261
)
 
 
 
18.24

Outstanding at March 31, 2016
 
27,761

 
 
 
11.07

Vested at March 31, 2016
 
15,858

 
 
 
6.95

The following table summarizes our RSU activity for the three months ended March 31, 2016:
 
 
Number of
Shares of Class A Common Stock (#)
 
Weighted-
Average
Grant-
Date Fair
Value ($)
Outstanding at December 31, 2015
 
93

 
 
Granted
 
1,600

 
29.74

Vested
 
(26
)
 
 
Forfeited
 
(13
)
 
 
Outstanding at March 31, 2016
 
1,654

 
 
At March 31, 2016, total unrecognized compensation expense related to non-vested stock options and RSUs was $53.8 million and $33.5 million, respectively, with an expected remaining weighted-average recognition period of 2.4 years and 3.5 years, respectively. We currently believe the performance targets related to the vesting of performance awards will be achieved. If such targets are not achieved, or are subsequently determined to not be probable of being achieved, we will not recognize any compensation expense relating to performance awards, and will reverse any previously recognized expense.
The fair value of each ESPP share is estimated on the first day of each offering period using the Black-Scholes option pricing model, and is recognized as compensation expense on a straight-line basis over the term of each six-month offering period. As of March 31, 2016, $8.8 million has been withheld on behalf of employees for future purchases under the ESPP, which is included in accrued expenses and other current liabilities. At March 31, 2016, total unrecognized compensation expense related to ESPP shares was $0.7 million, which will be recognized during the second quarter of 2016.
Deferred Revenue
Deferred Revenue
Deferred Revenue
Deferred revenue consists of the following:
 
March 31, 2016
 
December 31, 2015
Current:
 
 
 
Domains
$
522.3

 
$
497.2

Hosting and presence
350.4

 
330.8

Business applications
121.5

 
109.7

 
$
994.2

 
$
937.7

Noncurrent:
 
 
 
Domains
$
301.9

 
$
288.5

Hosting and presence
157.4

 
149.7

Business applications
45.0

 
40.3

 
$
504.3

 
$
478.5

Long-Term Debt
Long-Term Debt
Long-Term Debt
Long-term debt consists of the following:
 
March 31, 2016
 
December 31, 2015
Term Loan due May 13, 2021 (effective interest rate of 4.9% at March 31, 2016 and 5.1% at December 31, 2015)
$
1,080.7

 
$
1,083.5

Revolving Credit Loan due May 13, 2019
—

 
—

Total
1,080.7

 
1,083.5

Less unamortized original issue discounts on long-term debt(1)
(35.2
)
 
(36.8
)
Less unamortized debt issuance costs(1)
(2.6
)
 
(2.7
)
Less current portion of long-term debt
(4.2
)
 
(4.2
)
 
$
1,038.7

 
$
1,039.8

 
 
(1)
Original issue discounts and debt issuance costs are amortized to interest expense over the life of the related debt instruments using the effective interest method.
Term Loan and Revolving Credit Loan
Our amended and restated secured credit agreement (the Credit Facility) consists of a $1,100.0 million original balance term loan maturing on May 13, 2021 (the Term Loan) and an available $150.0 million revolving credit loan maturing on May 13, 2019 (the Revolving Credit Loan). Borrowings under the Credit Facility bear interest at a rate equal to, at our option, either (a) LIBOR (not less than 1.0% for the Term Loan only) plus 3.25% per annum or (b) 2.25% per annum plus the highest of (i) the Federal Funds Rate plus 0.5%, (ii) the Prime Rate or (iii) one-month LIBOR plus 1.0%.
At March 31, 2016, we had $150.0 million available for borrowing under the Revolving Credit Loan and were not in violation of any covenants of the Credit Facility.
The estimated fair value of the Term Loan was $1,080.0 million at March 31, 2016 based on observable market prices for this loan, which is traded in a less active market and is therefore classified as a Level 2 fair value measurement.
Future Debt Maturities
Aggregate principal payments, exclusive of any unamortized original issue discounts and debt issuance costs, due on long-term debt as of March 31, 2016 are as follows:
Year Ending December 31:
 
2016 (remainder of)
$
8.2

2017
11.0

2018
11.0

2019
11.0

2020
11.0

Thereafter
1,028.5

 
$
1,080.7

Commitments and Contingencies
Commitments and Contingencies
Commitments and Contingencies
Litigation
From time-to-time, we are a party to litigation and subject to claims incident to the ordinary course of business, including intellectual property claims, labor and employment claims, breach of contract claims and other asserted and unasserted claims. We investigate these claims as they arise and accrue estimates for resolution of legal and other contingencies when losses are probable and estimable. While the results of such normal course claims and legal proceedings cannot be predicted with certainty, management does not believe, based on current knowledge and the likely timing of resolution of various matters, any additional reasonably possible potential losses above the amount accrued for such matters would be material to our consolidated financial statements. Regardless of the outcome, legal proceedings may have an adverse effect on us because of defense costs, diversion of management resources and other factors.
Indemnifications
In the normal course of business, we have made indemnities under which we may be required to make payments in relation to certain transactions. These include indemnities to our directors and officers to the maximum extent permitted under applicable state laws and indemnifications related to certain lease agreements. In addition, certain advertiser and reseller partner agreements contain indemnification provisions, which are generally consistent with those prevalent in the industry. We have not incurred material obligations under indemnification provisions historically, and do not expect to incur material obligations in the future. Accordingly, we have not recorded any liabilities related to such indemnities as of March 31, 2016 and December 31, 2015.
We include service level commitments to our customers guaranteeing certain levels of uptime reliability and performance for our hosting and premium DNS products. These guarantees permit those customers to receive credits in the event we fail to meet those levels, with exceptions for certain service interruptions including but not limited to periodic maintenance. We have not incurred any material costs as a result of such commitments during any of the periods presented, and have not recorded any liabilities related to such obligations as of March 31, 2016 and December 31, 2015.
Indirect Taxes
We are subject to indirect taxation in some, but not all, of the various states and foreign jurisdictions in which we conduct business. Laws and regulations attempting to subject communications and commerce conducted over the Internet to various indirect taxes are becoming more prevalent, both in the U.S. and internationally, and may impose additional burdens on us in the future. Increased regulation could negatively affect our business directly, as well as the businesses of our customers. Taxing authorities may impose indirect taxes on the Internet-related revenue we generate based on regulations currently being applied to similar, but not directly comparable, industries. There are many transactions and calculations where the ultimate indirect tax determination is uncertain. In addition, domestic and international indirect taxation laws are complex and subject to change. We may be audited in the future, which could result in changes to our indirect tax estimates. We continually evaluate those jurisdictions in which nexus exists, and believe we maintain adequate indirect tax accruals.
As of March 31, 2016 and December 31, 2015, our accrual for estimated indirect tax liabilities was $7.4 million and $7.1 million, respectively, reflecting our best estimate of the probable liability based on an analysis of our business activities, revenues subject to indirect taxes and applicable regulations in each jurisdiction. Although we believe our indirect tax estimates and associated reserves are reasonable, the final determination of indirect tax audits and any related litigation could be different than the amounts established for indirect tax contingencies.
Income Taxes
Income Taxes
Income Taxes
We are required to file federal and applicable state corporate income tax returns and recognize income taxes on pre-tax income. Desert Newco has been and will continue to be treated as a partnership for U.S. income tax purposes. As such, Desert Newco is considered a pass-through entity and generally does not pay income taxes on its taxable income in most jurisdictions. Instead, Desert Newco's members, of which we are one, are liable for U.S. federal and state income taxes based on their taxable income. Desert Newco is liable for income taxes in certain foreign jurisdictions, in those states not recognizing its pass-through status and for certain subsidiaries not taxed as pass-through entities. We have acquired the outstanding stock of various entities taxed as corporations, which are now owned 100% by us or our subsidiaries and are treated as an independent consolidated group for federal income tax purposes. Where required or allowed, these subsidiaries also file as a consolidated group for state income tax purposes. We anticipate this structure to remain in existence for the foreseeable future.
Our effective tax rate differs from statutory rates primarily due to Desert Newco's pass-through structure for U.S. income tax purposes, while being treated as taxable in certain states and various foreign jurisdictions as well as for certain subsidiaries. In all foreign jurisdictions where we conduct business, except Canada, we are subject to income tax in both the U.S. and the foreign jurisdictions.
Based on our limited operating history and future projections of taxable income, we believe there is significant uncertainty as to when we will be able to utilize the net operating loss (NOL) and credit carryforwards and other tax attributes received through our IPO and related pre-IPO organizational transactions. Therefore, we have concluded it is more-likely-than-not these deferred tax assets will not be realized and have recorded a valuation allowance against these deferred tax assets. Net deferred tax assets associated with our subsidiaries taxed as corporations are considered by management to be more-likely-than-not of being realized; therefore, we have not recorded a valuation allowance against such deferred tax assets.
Based on our analysis of tax positions taken on income tax returns filed, we have determined a liability related to uncertain income tax positions is not required. Although we believe the amounts reflected in our tax returns substantially comply with applicable federal, state and foreign tax regulations, the respective taxing authorities may take contrary positions based on their interpretation of the law. A tax position successfully challenged by a taxing authority could result in an adjustment to our provision or benefit for income taxes in the period in which a final determination is made.
Payable to Related Parties Pursuant to the TRAs
As of December 31, 2015, our liability under the TRAs was $151.6 million, representing approximately 85% of the calculated tax savings based on the portion of the original basis adjustments (the OBAs) we anticipated being able to utilize in future years. During the three months ended March 31, 2016, we increased this liability to $156.2 million, through a charge to our consolidated statement of operations, due to changes resulting from the finalization of 2015 taxable income allocated to each Desert Newco owner.
The projection of future taxable income involves significant judgment. Actual taxable income may differ from our estimates, which could significantly impact the liability under the TRAs. We have determined it is more-likely-than-not we will be unable to utilize all of our deferred tax assets subject to the TRAs; therefore, we have not recorded a liability under the TRAs related to the tax savings we may realize from the utilization of NOL carryforwards. If utilization of these NOL carryforwards becomes more-likely-than-not in the future, at such time, we will record a liability under the TRAs of up to an additional $109.4 million related to the tax attributes received in the pre-IPO organizational transactions, which will be recorded as a charge to our consolidated statement of operations. Additionally, if these tax attributes are not utilized in future years, it is reasonably possible no amounts would be paid under the TRAs.
Tax Distributions to Desert Newco's Owners
Desert Newco is subject to an operating agreement containing numerous provisions related to allocations of income and loss, as well as timing and amounts of distributions to its owners. This agreement also includes a provision requiring cash distributions enabling its owners to pay their taxes on income passing through from Desert Newco. These tax distributions are computed based on an assumed income tax rate equal to the sum of (i) the maximum marginal federal income tax rate applicable to an individual and (ii) 7%. The assumed income tax rate currently totals 46.6%, which will increase to 50.4% in certain cases when the tax on net investment income is applicable.
In addition, under the tax rules, Desert Newco is required to allocate taxable income disproportionately to its unit holders. Because tax distributions are determined based on the holder of LLC Units who is allocated the largest amount of cumulative taxable income for the current year on a per unit basis, but are made pro rata based on ownership, Desert Newco is required to make tax distributions that, in the aggregate, will likely exceed the amount of taxes Desert Newco would have otherwise paid.
As of December 31, 2015, our accrual for tax distributions related to estimated taxable income allocations to Desert Newco's owners for 2015, excluding us, was $5.3 million. In March 2016, following the finalization of 2015 taxable income allocated to each Desert Newco owner, we paid $4.6 million of such distributions based on ownership as of the payment date as follows: $1.8 million to YAM, $1.0 million to Silver Lake, $1.0 million to KKR, $0.5 million to TCV and $0.3 million to other Desert Newco owners. The remaining accrual was reversed to additional paid-in capital.
As of March 31, 2016, we accrued $5.8 million, with an offsetting reduction in additional paid-in capital, for tax distributions related to estimated taxable income allocations to Desert Newco's owners for the first quarter of 2016, excluding us, which was paid in April 2016 based on ownership as of the payment date as follows: $2.3 million to YAM, $1.3 million to Silver Lake, $1.2 million to KKR, $0.7 million to TCV and $0.3 million to other Desert Newco owners.
Loss Per Share
Loss Per Share
Loss Per Share
Basic loss per share is computed by dividing net loss attributable to GoDaddy Inc. by the weighted-average number of shares of Class A common stock outstanding during the period. Diluted loss per share is computed giving effect to all potentially dilutive shares, including outstanding options, RSUs and warrants. Diluted loss per share for all periods presented is the same as basic loss per share as the inclusion of potentially issuable shares would be antidilutive.
For purposes of calculating loss per share for periods prior to the IPO, we treated the pre-IPO organizational transactions as a merger of entities under common control. Therefore, we have retrospectively reflected loss per share as though those transactions had occurred as of the earliest period presented. For all periods prior to the IPO, we allocated our historical net loss between the Class A stockholders and the non-controlling interest based on their respective share ownership. These calculations do not consider the 26,000 shares of Class A common stock sold in our IPO.
A reconciliation of the numerator and denominator used in the calculation of basic and diluted net loss per share is as follows:
 
Three Months Ended March 31,
 
2016
 
2015
Numerator:
 
 
 
Net loss
$
(18.3
)
 
$
(43.4
)
Less: net loss attributable to non-controlling interests
(7.8
)
 
(30.3
)
Net loss attributable to GoDaddy Inc.
$
(10.5
)
 
$
(13.1
)
 
 
 
 
Denominator:
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
67,834

 
38,826

Effect of dilutive securities
—

 
—

Weighted-average shares of Class A Common stock outstanding—diluted
67,834

 
38,826

 
 
 
 
Net loss per share of Class A common stock—basic and diluted
$
(0.15
)
 
$
(0.34
)

The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted loss per share because the effect of including such potentially dilutive shares would have been antidilutive:
 
Three Months Ended March 31,
 
2016
 
2015
Options, RSUs and warrants
16,382

 
12,264


Shares of Class B common stock do not share in our earnings and are not participating securities. Accordingly, separate presentation of loss per share of Class B common stock under the two-class method has not been presented. Each share of Class B common stock (together with a corresponding LLC Unit) is exchangeable for one share of Class A common stock. The shares of Class B common stock were determined to be antidilutive under the if-converted and two-class methods; therefore, they are not included in the computation of net loss per share. Total shares of common stock outstanding were as follows:
 
March 31, 2016
 
December 31, 2015
Class A common stock
68,363

 
67,083

Class B common stock
89,807

 
90,398

 
158,170

 
157,481

Geographic Information
Geographic Information
Geographic Information
Revenue by geography is based on the customer's billing address, and was as follows:
 
Three Months Ended March 31,
 
2016
 
2015
U.S.
$
321.0

 
$
279.7

International
112.7

 
96.6

 
$
433.7

 
$
376.3


No individual international country represented more than 10% of total revenue in any period presented. Substantially all of our assets are located in the U.S.
Related Party Transactions
Related Party Transactions
Related Party Transactions
Sponsors
Amounts paid to affiliates of KKR related to their participation as lenders under our Credit Facility were as follows:
 
Three Months Ended March 31,
 
2016
 
2015
Principal
$
0.1

 
$
0.1

Interest and other fees
0.3

 
0.4


As of March 31, 2016 and December 31, 2015, affiliates of KKR held $28.7 million and $28.8 million, respectively, of the outstanding principal balance of the Term Loan as participating lenders.
Desert Newco pays tax distributions to its owners, including the Sponsors. See Note 8 for details of the amounts paid and payable to the Sponsors.
Bob Parsons and YAM
During the three months ended March 31, 2016 and 2015, we paid $0 and $6.8 million, respectively, of interest to YAM under a senior note, which was repaid in April 2015.
Desert Newco pays tax distributions to its owners, including YAM. See Note 8 for details of the amounts paid and payable to YAM.
Other
In the ordinary course of business, we purchase and lease computer equipment, technology licensing and software maintenance and support from affiliates of Dell Inc. (Dell) of which Silver Lake and its affiliates have a significant ownership interest. During the three months ended March 31, 2016 and 2015, we paid $4.0 million and $5.6 million, respectively, to Dell.
Subsequent Events
Subsequent Events
Subsequent Events
In April 2016, we completed a secondary offering in which certain stockholders, including the Sponsors, YAM and certain of our executive officers, sold an aggregate of 18,975 shares of our Class A common stock at a public offering price of $30.25 per share. We received $6.3 million in proceeds from the exercise of stock options in connection with the offering, but did not receive any of the proceeds from the offering. The offering also included the exchange of 10,382 LLC Units (together with the corresponding shares of Class B common stock) for Class A common stock by certain selling stockholders, which will result in a material increase to the TRA liability during the three months ending June 30, 2016.
In April 2016, we completed an immaterial acquisition for cash consideration of $42.0 million.
Summary of Significant Accounting Policies (Policies)
Basis of Presentation 
Basis of Presentation
Our condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States (GAAP), and include our accounts and the accounts of our subsidiaries. All material intercompany accounts and transactions have been eliminated in consolidation
Prior Period Reclassifications 
Prior Period Reclassifications
Reclassifications of certain immaterial prior period amounts have been made to conform to the current period presentation.
Use of Estimates 
Use of Estimates
The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions affecting amounts reported in our financial statements. Our more significant estimates include:
•
the determination of the best estimate of selling price of the deliverables included in multiple-deliverable revenue arrangements;
•the fair value of assets acquired and liabilities assumed in business combinations;
•
the assessment of recoverability of long-lived assets, including property and equipment, goodwill and intangible assets;
•the estimated reserve for refunds;
•the estimated useful lives of intangible and depreciable assets;
•the grant date fair value of equity-based awards;
•the recognition, measurement and valuation of current and deferred income taxes;
•the recognition and measurement of amounts payable under tax receivable agreements;
•the recognition and measurement of amounts payable as tax distributions to Desert Newco's owners; and
•the recognition and measurement of loss contingencies, indirect tax liabilities and certain accrued liabilities.
We periodically evaluate these estimates and adjust prospectively, if necessary. We believe our estimates and assumptions are reasonable; however, actual results may differ from our estimates.
Segments 
Segments and Reporting Units
Our chief operating decision maker function is comprised of our Chief Executive Officer and Chief Operating Officer who collectively review financial information presented on a consolidated basis for purposes of allocating resources and evaluating financial performance for the entire company. Accordingly, we have a single operating segment and reporting unit structure.
Derivative Financial Instruments 
Derivative Financial Instruments
We enter into foreign exchange forward contracts with financial institutions to hedge certain forecasted sales transactions denominated in currencies other than the United States (U.S.) dollar. We designate these forward contracts as cash flow hedges, which are recognized as either assets or liabilities at fair value. We do not hold or issue derivative instruments for speculative or trading purposes. At March 31, 2016, the total notional amount of outstanding contracts was $74.9 million, all having maturities of 12 months or less.
We reflect unrealized gains or losses on the effective portion of a cash flow hedge as a component of accumulated other comprehensive income. Gains and losses, once realized, are recorded as a component of accumulated other comprehensive income and are amortized to revenue over the same period in which the underlying hedged amounts are recognized. Any ineffective portion of gains or losses are recorded as other income (expense), net. Such gains or losses were immaterial during all periods presented. Each period, we evaluate the effectiveness of each of our hedges.
Fair Value Measurements 
Fair Value Measurements
Fair value is defined as an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. The framework for measuring fair value provides a three-tier hierarchy prioritizing inputs to valuation techniques used in measuring fair value as follows:
Level 1—Observable inputs such as quoted prices for identical assets or liabilities in active markets;
Level 2—Inputs, other than quoted prices for identical assets or liabilities in active markets, which are observable either directly or indirectly; and
Level 3—Unobservable inputs in which there is little or no market data requiring the reporting entity to develop its own assumptions.
Recent Accounting Pronouncements 
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board (FASB) issued a new standard on revenue recognition from contracts with customers. The new standard requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount reflecting the consideration to which the entity expects to be entitled to in exchange for those goods or services. In July 2015, the FASB approved a one year deferral of the effective date making the new standard effective for annual and interim reporting periods beginning after December 15, 2017, with early adoption permitted as of the original effective date. The new standard may be applied retrospectively to each prior period presented or retrospectively with the cumulative effect recognized as of the date of adoption. In March 2016, the FASB amended the principal-versus-agent implementation guidance set forth in the new standard. Among other things, this amendment clarifies that an entity should evaluate whether it is the principal or the agent for each specified good or service promised in a contract with a customer. In April 2016, the FASB amended certain aspects of the new standard related to identifying performance obligations and licensing implementation. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In April 2015, the FASB issued new guidance related to accounting for fees paid in a cloud computing arrangement. The new standard provides guidance to customers about whether a cloud computing arrangement includes a software license. If a cloud computing arrangement includes a software license, the customer should account for the software license element of the arrangement consistent with the acquisition of other software licenses. If a cloud computing arrangement does not include a software license, the customer should account for the arrangement as a service contract. The adoption of this guidance on January 1, 2016 did not have a material impact on our consolidated financial statements.
In February 2016, the FASB issued new guidance related to accounting for leases. The new standard requires the recognition of assets and liabilities arising from lease transactions on the balance sheet and the disclosure of key information about leasing arrangements. Accordingly, a lessee will recognize a lease asset for its right to use the underlying asset and a lease liability for the corresponding lease obligation. Both the asset and liability will initially be measured at the present value of the future minimum lease payments over the lease term. Subsequent measurement, including the presentation of expenses and cash flows, will depend on the classification of the lease as either a finance or an operating lease. Initial costs directly attributable to negotiating and arranging the lease will be included in the asset. For leases with a term of 12 months or less, a lessee can make an accounting policy election by class of underlying asset to not recognize an asset and corresponding liability. Lessees will also be required to provide additional qualitative and quantitative disclosures regarding the amount, timing and uncertainty of cash flows arising from leases. These disclosures are intended to supplement the amounts recorded in the financial statements and provide additional information about the nature of an organization’s leasing activities. The new standard is effective for fiscal years beginning after December 15, 2018, and interim periods within those years, with early adoption permitted. In transition, lessees are required to recognize and measure leases at the beginning of the earliest period presented using a modified retrospective approach. The transition guidance also provides specific guidance for sale and leaseback transactions, build-to-suit leases and amounts previously recognized in accordance with the business combinations guidance for leases. We are currently evaluating the timing of our adoption and the impact of this new standard on our consolidated financial statements.
In March 2016, the FASB issued new guidance changing the accounting for certain aspects of share-based payments to employees. The guidance allows for a policy election to account for forfeitures as they occur rather than on an estimated basis and allows for an employer to repurchase more of an employee’s shares for tax withholding purposes without triggering liability accounting. In addition, the guidance requires recognition of the income tax effects of awards in the income statement when the awards vest or are settled, thus eliminating additional paid-in capital pools. The guidance is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption permitted. We are currently evaluating the timing of our adoption and the impact of this new guidance on our consolidated financial statements.
In March 2016, the FASB issued new guidance clarifying that a change in the counterparty to a derivative instrument designated as a hedging instrument does not, in and of itself, require de-designation of the hedging relationship provided all other hedge accounting criteria continue to be met. The guidance is effective for annual and interim reporting periods beginning after December 15, 2016, with early adoption permitted. The adoption of this guidance in the first quarter of 2016 did not have a material impact on our consolidated financial statements.
Summary of Significant Accounting Policies (Tables)
Fair Value, Assets Measured on Recurring Basis
We classify these assets within Level 1 or Level 2 because we use either quoted market prices or alternative pricing sources utilizing market observable inputs to determine their fair value, as follows:
 
March 31, 2016
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Reverse repurchase agreements(1)
$
—

 
$
130.0

 
$
—

 
$
130.0

Short-term investments:
 
 
 
 
 
 
 
Certificates of deposit and time deposits
8.4

 
—

 
—

 
8.4

Total assets measured and recorded at fair value
$
8.4

 
$
130.0

 
$
—

 
$
138.4

 
 
(1)
Reverse repurchase agreements include an $80.0 million repurchase agreement with Morgan Stanley, callable with 31 days notice, and a $50.0 million repurchase agreement with Wells Fargo in overnight sweeps.
 
December 31, 2015
 
Level 1
 
Level 2
 
Level 3
 
Total
Cash and cash equivalents:
 
 
 
 
 
 
 
Reverse repurchase agreements(1)
$
—

 
$
40.0

 
$
—

 
$
40.0

Short-term investments:
 
 
 
 
 
 
 
Certificates of deposit
4.5

 
—

 
—

 
4.5

Total assets measured and recorded at fair value
$
4.5

 
$
40.0

 
$
—

 
$
44.5

 
 
(1)
Reverse repurchase agreements include a $40.0 million repurchase agreement with Wells Fargo in overnight sweeps.
Intangible Assets (Tables)
Schedule of Indefinite-Lived Intangible Assets 
Intangible assets, net are summarized as follows:
 
March 31, 2016
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
 n/a

 
$
(5.7
)
 
55.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(208.0
)
 
 n/a

 
153.2

Developed technology
210.1

 
(157.9
)
 
 n/a

 
52.2

Trade names
11.2

 
(5.9
)
 
 n/a

 
5.3

Other
1.1

 
(0.9
)
 
 n/a

 
0.2

 
$
1,089.8

 
$
(372.7
)
 
$
(5.7
)
 
$
711.4

 
December 31, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
n/a

 
(3.7
)
 
57.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(196.8
)
 
 n/a

 
164.4

Developed technology
210.1

 
(148.0
)
 
 n/a

 
62.1

Trade names
11.2

 
(5.2
)
 
 n/a

 
6.0

Other
1.1

 
(0.8
)
 
 n/a

 
0.3

 
$
1,089.8

 
$
(350.8
)
 
$
(3.7
)
 
$
735.3

Schedule of Finite-Lived Intangible Assets 
Intangible assets, net are summarized as follows:
 
March 31, 2016
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
 n/a

 
$
(5.7
)
 
55.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(208.0
)
 
 n/a

 
153.2

Developed technology
210.1

 
(157.9
)
 
 n/a

 
52.2

Trade names
11.2

 
(5.9
)
 
 n/a

 
5.3

Other
1.1

 
(0.9
)
 
 n/a

 
0.2

 
$
1,089.8

 
$
(372.7
)
 
$
(5.7
)
 
$
711.4

 
December 31, 2015
 
Gross Carrying
Amount
 
Accumulated
Amortization
 
Domains Sold
 
Net Carrying
Amount
Indefinite-lived intangible assets:
 
 
 
 
 
 
 
Trade names and branding
$
445.0

 
 n/a

 
 n/a

 
$
445.0

Domain portfolio
61.2

 
n/a

 
(3.7
)
 
57.5

Finite-lived intangible assets:
 
 
 
 
 
 
 
Customer-related
361.2

 
$
(196.8
)
 
 n/a

 
164.4

Developed technology
210.1

 
(148.0
)
 
 n/a

 
62.1

Trade names
11.2

 
(5.2
)
 
 n/a

 
6.0

Other
1.1

 
(0.8
)
 
 n/a

 
0.3

 
$
1,089.8

 
$
(350.8
)
 
$
(3.7
)
 
$
735.3

Schedule of Finite-Lived Intangible Assets, Future Amortization Expense 
Based on the balance of finite-lived intangible assets at March 31, 2016, expected future amortization expense is as follows:
Year Ending December 31:
 
2016 (remainder of)
$
67.2

2017
52.8

2018
44.6

2019
25.9

2020
20.4

Thereafter
—

 
$
210.9

Equity-Based Compensation Plans (Tables)
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award
The following table summarizes our option activity for the three months ended March 31, 2016:
 
 
Number of
Shares of Class A Common Stock (#)
 
Weighted-
Average
Grant-
Date Fair
Value ($)
 
Weighted-
Average
Exercise
Price ($)
Outstanding at December 31, 2015
 
27,419

 
 
 
10.25

Granted
 
1,266

 
11.68

 
29.96

Exercised
 
(663
)
 
 
 
10.43

Forfeited
 
(261
)
 
 
 
18.24

Outstanding at March 31, 2016
 
27,761

 
 
 
11.07

Vested at March 31, 2016
 
15,858

 
 
 
6.95

The following table summarizes our RSU activity for the three months ended March 31, 2016:
 
 
Number of
Shares of Class A Common Stock (#)
 
Weighted-
Average
Grant-
Date Fair
Value ($)
Outstanding at December 31, 2015
 
93

 
 
Granted
 
1,600

 
29.74

Vested
 
(26
)
 
 
Forfeited
 
(13
)
 
 
Outstanding at March 31, 2016
 
1,654

 
 
Deferred Revenue (Tables)
Deferred Revenue, by Arrangement
Deferred revenue consists of the following:
 
March 31, 2016
 
December 31, 2015
Current:
 
 
 
Domains
$
522.3

 
$
497.2

Hosting and presence
350.4

 
330.8

Business applications
121.5

 
109.7

 
$
994.2

 
$
937.7

Noncurrent:
 
 
 
Domains
$
301.9

 
$
288.5

Hosting and presence
157.4

 
149.7

Business applications
45.0

 
40.3

 
$
504.3

 
$
478.5

Long-Term Debt (Tables)
Schedule of Long-term Debt Instruments 
Long-term debt consists of the following:
 
March 31, 2016
 
December 31, 2015
Term Loan due May 13, 2021 (effective interest rate of 4.9% at March 31, 2016 and 5.1% at December 31, 2015)
$
1,080.7

 
$
1,083.5

Revolving Credit Loan due May 13, 2019
—

 
—

Total
1,080.7

 
1,083.5

Less unamortized original issue discounts on long-term debt(1)
(35.2
)
 
(36.8
)
Less unamortized debt issuance costs(1)
(2.6
)
 
(2.7
)
Less current portion of long-term debt
(4.2
)
 
(4.2
)
 
$
1,038.7

 
$
1,039.8

 
 
(1)
Original issue discounts and debt issuance costs are amortized to interest expense over the life of the related debt instruments using the effective interest method.
Schedule of Maturities of Long-term Debt 
Aggregate principal payments, exclusive of any unamortized original issue discounts and debt issuance costs, due on long-term debt as of March 31, 2016 are as follows:
Year Ending December 31:
 
2016 (remainder of)
$
8.2

2017
11.0

2018
11.0

2019
11.0

2020
11.0

Thereafter
1,028.5

 
$
1,080.7

Loss Per Share (Tables)
Schedule of Earnings Per Share, Basic and Diluted 
A reconciliation of the numerator and denominator used in the calculation of basic and diluted net loss per share is as follows:
 
Three Months Ended March 31,
 
2016
 
2015
Numerator:
 
 
 
Net loss
$
(18.3
)
 
$
(43.4
)
Less: net loss attributable to non-controlling interests
(7.8
)
 
(30.3
)
Net loss attributable to GoDaddy Inc.
$
(10.5
)
 
$
(13.1
)
 
 
 
 
Denominator:
 
 
 
Weighted-average shares of Class A common stock outstanding—basic
67,834

 
38,826

Effect of dilutive securities
—

 
—

Weighted-average shares of Class A Common stock outstanding—diluted
67,834

 
38,826

 
 
 
 
Net loss per share of Class A common stock—basic and diluted
$
(0.15
)
 
$
(0.34
)
Schedule of Antidilutive Securities Excluded from Computation of Earnings Per Share 
The following number of weighted-average potentially dilutive shares were excluded from the calculation of diluted loss per share because the effect of including such potentially dilutive shares would have been antidilutive:
 
Three Months Ended March 31,
 
2016
 
2015
Options, RSUs and warrants
16,382

 
12,264

Schedule of Stock by Class 
Total shares of common stock outstanding were as follows:
 
March 31, 2016
 
December 31, 2015
Class A common stock
68,363

 
67,083

Class B common stock
89,807

 
90,398

 
158,170

 
157,481

Geographic Information (Tables)
Revenue from External Customers by Geographic Areas
Revenue by geography is based on the customer's billing address, and was as follows:
 
Three Months Ended March 31,
 
2016
 
2015
U.S.
$
321.0

 
$
279.7

International
112.7

 
96.6

 
$
433.7

 
$
376.3

Related Party Transactions (Tables)
Schedule of Related Party Transactions
Amounts paid to affiliates of KKR related to their participation as lenders under our Credit Facility were as follows:
 
Three Months Ended March 31,
 
2016
 
2015
Principal
$
0.1

 
$
0.1

Interest and other fees
0.3

 
0.4

Organization and Background (Details)
3 Months Ended 0 Months Ended
Mar. 31, 2016
segment
Mar. 31, 2016
Desert Newco, LLC
Class of Stock [Line Items]
 
 
LLC units held (as a percent)
 
43.00% 
Number of reporting units
1 
 
Number of operating segments
1 
 
Summary of Significant Accounting Policies (Details) (Cash Flow Hedging, Designated as Hedging Instrument, Foreign Exchange Forward Contract, USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Cash Flow Hedging |
Designated as Hedging Instrument |
Foreign Exchange Forward Contract
 
Derivative [Line Items]
 
Derivative notional amount
$ 74.9 
Summary of Significant Accounting Policies Fair Value Measurements (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Morgan Stanley
Mar. 31, 2016
Wells Fargo
Dec. 31, 2015
Wells Fargo
Mar. 31, 2016
Fair Value, Measurements, Recurring [Member]
Dec. 31, 2015
Fair Value, Measurements, Recurring [Member]
Mar. 31, 2016
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Dec. 31, 2015
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Mar. 31, 2016
Fair Value, Measurements, Recurring [Member]
Level 2
Dec. 31, 2015
Fair Value, Measurements, Recurring [Member]
Level 2
Mar. 31, 2016
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Dec. 31, 2015
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Mar. 31, 2016
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Dec. 31, 2015
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Mar. 31, 2016
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Dec. 31, 2015
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Mar. 31, 2016
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Level 2
Dec. 31, 2015
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Level 2
Mar. 31, 2016
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Dec. 31, 2015
Repurchase Agreements [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Mar. 31, 2016
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Dec. 31, 2015
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Mar. 31, 2016
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Dec. 31, 2015
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 1 [Member]
Mar. 31, 2016
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Level 2
Dec. 31, 2015
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Level 2
Mar. 31, 2016
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Dec. 31, 2015
Bank Time Deposits [Member]
Fair Value, Measurements, Recurring [Member]
Fair Value, Inputs, Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and cash equivalents, fair value
 
 
 
 
 
 
 
 
 
 
 
$ 130.0 
$ 40.0 
$ 0 
$ 0 
$ 130.0 
$ 40.0 
$ 0 
$ 0 
 
 
 
 
 
 
 
 
Short-term investments, fair value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8.4 
4.5 
8.4 
4.5 
0 
0 
0 
0 
Assets, fair value
 
 
 
138.4 
44.5 
8.4 
4.5 
130.0 
40.0 
0 
0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Repurchase agreement amount
$ 80.0 
$ 50.0 
$ 40.0 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Repurchase agreement callable notice period
31 days 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, accumulated amortization
$ (372.7)
$ (350.8)
Finite-lived intangible assets, net
210.9 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Domains sold
(5.7)
(3.7)
Intangible assets, gross (excluding goodwill)
1,089.8 
1,089.8 
Intangible asset, net (excluding goodwill)
711.4 
735.3 
Trade names and branding
 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Indefinite-lived intangible assets (excluding goodwill)
445.0 
445.0 
Domain Portfolio
 
 
Indefinite-lived Intangible Assets [Line Items]
 
 
Indefinite-lived intangible assets (excluding goodwill)
55.5 
57.5 
Indefinite-lived intangible assets (excluding goodwill), gross
61.2 
61.2 
Domains sold
(5.7)
(3.7)
Customer-related
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
361.2 
361.2 
Finite-lived intangible assets, accumulated amortization
(208.0)
(196.8)
Finite-lived intangible assets, net
153.2 
164.4 
Developed technology
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
210.1 
210.1 
Finite-lived intangible assets, accumulated amortization
(157.9)
(148.0)
Finite-lived intangible assets, net
52.2 
62.1 
Trade names
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
11.2 
11.2 
Finite-lived intangible assets, accumulated amortization
(5.9)
(5.2)
Finite-lived intangible assets, net
5.3 
6.0 
Other
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Finite-lived intangible assets, gross
1.1 
1.1 
Finite-lived intangible assets, accumulated amortization
(0.9)
(0.8)
Finite-lived intangible assets, net
$ 0.2 
$ 0.3 
Intangible Assets - Narrative (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Finite-Lived Intangible Assets [Line Items]
 
 
Amortization expense
$ 21.9 
$ 24.1 
Weighted Average
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Weighted average remaining amortization period
45 months 
 
Customer-related |
Weighted Average
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Useful life
99 months 
 
Developed technology |
Weighted Average
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Useful life
64 months 
 
Trade names |
Weighted Average
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Useful life
58 months 
 
Other |
Weighted Average
 
 
Finite-Lived Intangible Assets [Line Items]
 
 
Useful life
36 months 
 
Intangible Assets - Future Amortization of Finite Lived Intangible Assets (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Goodwill and Intangible Assets Disclosure [Abstract]
 
2016 (remainder of)
$ 67.2 
2017
52.8 
2018
44.6 
2019
25.9 
2020
20.4 
Thereafter
0 
Finite-lived intangible assets, net
$ 210.9 
Equity-Based Compensation Plans (Details) (USD $)
In Millions, except Share data in Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Jan. 1, 2016
Mar. 31, 2015
Employee Stock
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Unrecognized compensation costs
$ 0.7 
 
 
Funds withheld on behalf o employees
8.8 
 
 
Employee Stock Option
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Unrecognized compensation costs
53.8 
 
 
Weighted average recognition period
2 years 5 months 1 day 
 
 
Restricted Stock Units (RSUs)
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Unrecognized compensation costs
$ 33.5 
 
 
Weighted average recognition period
3 years 5 months 27 days 
 
 
2015 Equity Incentive Plan |
Class A Common Stock |
Stock Compensation Plan
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Shares reserved for future issuance
 
 
10,285 
Shares rolled over
13,290 
 
 
Additional shares reserved for future issuance
 
6,299 
 
2011 Unit Incentive Plan and Other Unidentified Plan |
Class A Common Stock |
Stock Compensation Plan
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Shares rolled over
 
 
28,133 
2015 Employee Stock Purchase Plan |
Class A Common Stock |
Employee Stock
 
 
 
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
 
 
 
Shares reserved for future issuance
 
 
2,000 
Shares rolled over
2,325 
 
 
Additional shares reserved for future issuance
 
1,000 
 
Offering period
6 months 
 
 
Equity-Based Compensation Plans Equity-based Award Activity (Details) (USD $)
In Thousands, except Per Share data, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Employee Stock Option
 
Number of Shares of Class A Common Stock ()
 
Outstanding at December 31, 2015 (in shares)
27,419 
Granted (in shares)
1,266 
Exercised (in shares)
(663)
Forfeited (in shares)
(261)
Outstanding at March 31, 2016 (in shares)
27,761 
Vested at March 31, 2016 (in shares)
15,858 
Weighted- Average Exercise Price ($)
 
Outstanding weighted average exercise price (in dollars per share)
$ 10.25 
Granted (in dollars per share)
$ 29.96 
Exercised (in dollars per share)
$ 10.43 
Forfeited (in dollars per share)
$ 18.24 
Outstanding weighted average exercise price (in dollars per share)
$ 11.07 
Vested at March 31, 2016 (in dollars per share)
$ 6.95 
Weighted-average grant date fair value of options granted (in dollars per share)
$ 11.68 
Restricted Stock Units (RSUs)
 
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
 
Outstanding at December 31, 2015 (in shares)
93 
Granted (in shares)
1,600 
Vested (in shares)
(26)
Forfeited (in shares)
(13)
Outstanding at March 31, 2016 (in shares)
1,654 
Weighted-average grant date fair value of RSUs granted (in dollar per share)
$ 29.74 
Deferred Revenue (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
$ 994.2 
$ 937.7 
Deferred revenue, noncurrent
504.3 
478.5 
Domains
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
522.3 
497.2 
Deferred revenue, noncurrent
301.9 
288.5 
Hosting and presence
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
350.4 
330.8 
Deferred revenue, noncurrent
157.4 
149.7 
Business applications
 
 
Deferred Revenue Arrangement [Line Items]
 
 
Deferred revenue, current
121.5 
109.7 
Deferred revenue, noncurrent
$ 45.0 
$ 40.3 
Long-Term Debt - Schedule of Long Term Debt (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Debt Instrument [Line Items]
 
 
Long-term Debt
$ 1,080.7 
$ 1,083.5 
Less unamortized original issue discounts on long-term debt
(35.2)
(36.8)
Less unamortized debt issuance costs
(2.6)
(2.7)
Less current portion of long-term debt
(4.2)
(4.2)
Long-term debt, net of current portion
1,038.7 
1,039.8 
Term Loan |
Term Loan Due May 2021
 
 
Debt Instrument [Line Items]
 
 
Long-term Debt
1,080.7 
1,083.5 
Effective interest rate
4.90% 
5.10% 
Line of Credit |
Revolving Credit Loan Due May 2019 |
Revolving Credit Facility
 
 
Debt Instrument [Line Items]
 
 
Long-term Debt
$ 0 
$ 0 
Long-Term Debt (Details) (USD $)
3 Months Ended
Mar. 31, 2016
Credit Facility |
London Interbank Offered Rate (LIBOR)
 
Debt Instrument [Line Items]
 
Base rate
1.00% 
Basis spread on variable rate
3.25% 
Credit Facility |
Federal Funds Rate
 
Debt Instrument [Line Items]
 
Base rate
2.25% 
Basis spread on variable rate
0.50% 
Credit Facility |
One-Month LIBOR
 
Debt Instrument [Line Items]
 
Basis spread on variable rate
1.00% 
Term Loan |
Term Loan Due May 2021
 
Debt Instrument [Line Items]
 
Long-term Debt
$ 1,100,000,000.0 
Term Loan |
Term Loan Due May 2021 |
Level 2
 
Debt Instrument [Line Items]
 
Debt, fair value
1,080,000,000 
Line of Credit |
Revolving Credit Loan Due May 2019 |
Revolving Credit Facility
 
Debt Instrument [Line Items]
 
Maximum borrowing capacity
150,000,000.0 
Available borrowing capacity
$ 150,000,000 
Long-Term Debt - Schedule of Debt Maturities (Details) (USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Debt Disclosure [Abstract]
 
 
2016 (remainder of)
$ 8.2 
 
2017
11.0 
 
2018
11.0 
 
2019
11.0 
 
2020
11.0 
 
Thereafter
1,028.5 
 
Long-term Debt
$ 1,080.7 
$ 1,083.5 
Commitments and Contingencies (Details) (Indirect Taxation, USD $)
In Millions, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Indirect Taxation
 
 
Loss Contingencies [Line Items]
 
 
Estimated tax liability
$ 7.4 
$ 7.1 
Income Taxes (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended 1 Months Ended 3 Months Ended 1 Months Ended
Mar. 31, 2016
Dec. 31, 2015
Mar. 31, 2016
Desert Newco, LLC
Mar. 31, 2016
Desert Newco, LLC
Apr. 30, 2016
Desert Newco, LLC
Subsequent Event
Mar. 31, 2016
Desert Newco, LLC
YAM Special Holdings, Inc
Mar. 31, 2016
Desert Newco, LLC
Silver Lake Partners
Apr. 30, 2016
Desert Newco, LLC
Silver Lake Partners
Subsequent Event
Mar. 31, 2016
Desert Newco, LLC
Kohlberg Kravis Roberts & Co LP
Apr. 30, 2016
Desert Newco, LLC
Kohlberg Kravis Roberts & Co LP
Subsequent Event
Mar. 31, 2016
Desert Newco, LLC
Technology Crossover Venture
Apr. 30, 2016
Desert Newco, LLC
Technology Crossover Venture
Subsequent Event
Mar. 31, 2016
Desert Newco, LLC
Other Desert Newco Owners
Apr. 30, 2016
Desert Newco, LLC
Other Desert Newco Owners
Subsequent Event
Mar. 31, 2016
Tax Receivable Agreement
Investor
Reorganization Parties and Continuing LLC Owners
Dec. 31, 2015
Tax Receivable Agreement
Investor
Reorganization Parties and Continuing LLC Owners
Related Party Transaction [Line Items]
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Payable to related parties pursuant to tax receivable agreements
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$ 156.2 
$ 151.6 
Percent of tax benefits owed under tax receivable agreement
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
85.00% 
Maximum TRA liability
 
 
 
 
 
 
 
 
 
 
 
 
 
 
109.4 
 
Assumed blended state income tax rate
 
 
 
7.00% 
 
 
 
 
 
 
 
 
 
 
 
 
Assumed income tax rate
 
 
 
46.60% 
 
 
 
 
 
 
 
 
 
 
 
 
Assumed income tax rate including tax on net investment income
 
 
 
50.40% 
 
 
 
 
 
 
 
 
 
 
 
 
Payable to related parties for tax distributions
3.6 
0 
 
 
 
 
 
 
 
 
 
 
 
 
5.8 
5.3 
Distributions paid
$ 5.0 
 
$ 4.6 
 
$ 2.3 
$ 1.8 
$ 1.0 
$ 1.3 
$ 1.0 
$ 1.2 
$ 0.5 
$ 0.7 
$ 0.3 
$ 0.3 
 
 
Loss Per Share (Details) (USD $)
In Millions, except Share data, unless otherwise specified
3 Months Ended 0 Months Ended 3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Mar. 31, 2016
Class B Common Stock
Apr. 7, 2015
Common Stock
Class A Common Stock
Mar. 31, 2015
Pro Forma [Member]
Earnings Per Share, Diluted, by Common Class, Including Two Class Method [Line Items]
 
 
 
 
 
Shares issued during IPO
 
 
 
26,000,000 
 
Net loss
$ (18.3)
$ (43.4)
 
 
 
Less: net loss attributable to non-controlling interests
(7.8)
0 
 
 
(30.3)
Net loss
$ (10.5)
$ (43.4)
 
 
$ (13.1)
Weighted-average shares of Class A common stock outstanding—basic
67,834,000 
38,826,000 
 
 
 
Effect of dilutive securities (in shares)
0 
0 
 
 
 
Weighted-average shares of Class A Common stock outstanding—diluted
67,834,000 1
38,826,000 1
 
 
 
Net loss per share—basic and diluted (in USD per share)
$ (0.15)1
$ (0.34)1
 
 
 
Conversion feature of Class B common stock, number of Class A common shares
 
 
1 
 
 
Loss Per Share Weighted Average Shares Excluded (Details)
In Thousands, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Earnings Per Share [Abstract]
 
 
Antidilutive securities excluded from diluted loss per unit calculation (in shares)
16,382 
12,264 
Loss Per Share Schedule of Shares Outstanding (Details)
In Thousands, unless otherwise specified
Mar. 31, 2016
Dec. 31, 2015
Class of Stock [Line Items]
 
 
Common stock outstanding (in shares)
158,170 
157,481 
Class A Common Stock
 
 
Class of Stock [Line Items]
 
 
Common stock outstanding (in shares)
68,363 
67,083 
Class B Common Stock
 
 
Class of Stock [Line Items]
 
 
Common stock outstanding (in shares)
89,807 
90,398 
Geographic Information (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
Revenue
$ 433.7 
$ 376.3 
U.S.
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
Revenue
321.0 
279.7 
International
 
 
Revenues from External Customers and Long-Lived Assets [Line Items]
 
 
Revenue
$ 112.7 
$ 96.6 
Related Party Transactions (Details) (USD $)
In Millions, unless otherwise specified
3 Months Ended
Mar. 31, 2016
Mar. 31, 2015
Dec. 31, 2015
Related Party Transaction [Line Items]
 
 
 
Long-term Debt
$ 1,080.7 
 
$ 1,083.5 
Interest on long-term debt
11.6 
20.6 
 
Dell Inc |
Affiliated Entity |
Purchase and Lease of Computer Equipment, Technology Licensing, Maintenance and Support
 
 
 
Related Party Transaction [Line Items]
 
 
 
Purchases from related party
4.0 
5.6 
 
Credit Facility |
Affiliates of KKR |
Affiliated Entity |
Loans Held by Related Parties
 
 
 
Related Party Transaction [Line Items]
 
 
 
Repayments of principal
0.1 
0.1 
 
Interest and other fees
0.3 
0.4 
 
Term Loan Due May 2021 |
Term Loan
 
 
 
Related Party Transaction [Line Items]
 
 
 
Long-term Debt
1,080.7 
 
1,083.5 
Term Loan Due May 2021 |
Affiliates of KKR |
Affiliated Entity |
Loans Held by Related Parties |
Term Loan
 
 
 
Related Party Transaction [Line Items]
 
 
 
Long-term Debt
28.7 
 
28.8 
Note Payable Due December 2019 |
GoDaddy Inc |
Affiliated Entity |
Loans Held by Related Parties |
Senior Notes
 
 
 
Related Party Transaction [Line Items]
 
 
 
Interest on long-term debt
$ 0 
$ 6.8 
 
Subsequent Events (Details) (Subsequent Event, USD $)
In Millions, except Share data, unless otherwise specified
1 Months Ended
Apr. 30, 2016
Series of Individually Immaterial Business Acquisitions
 
Subsequent Event [Line Items]
 
Payments to acquire business
$ 42.0 
Secondary Offering
 
Subsequent Event [Line Items]
 
Proceeds from stock options exercised
$ 6.3 
Secondary Offering |
Conversion of LLC Units to Class A Common Stock
 
Subsequent Event [Line Items]
 
Conversion of LLC units to common stock (in shares)
10,382 
Secondary Offering |
Class A Common Stock
 
Subsequent Event [Line Items]
 
Shares issued
18,975,000 
Share price (in USD per share)
$ 30.25