What happened

Web domain name and website hosting outfit GoDaddy (GDDY 0.53%) was really going today. Shares were up 12.5% as of 1:45 p.m. EDT. The internet firm reported third-quarter earnings that beat the average Wall Street analyst expectations. Q3 revenue was up 14% from a year prior to $964 million, and earnings per share of $0.58 were up 53%.

So what

GoDaddy is a legacy website hosting company. While it has continued to steadily grow over the years, younger cloud-based website building and management software firms like Shopify and Wix.com have grown at a far faster rate and begun to overshadow GoDaddy's own success. For example, over the past five-year stretch, Shopify's revenue has ballooned and is up nearly 1,000%, and Wix has grown sales nearly 300%. GoDaddy revenue has merely doubled in comparison.  

Two people working on a website for clothing and fashion.

Image source: Getty Images.

GoDaddy is profitable, though, and is quickly ramping up its business applications segment -- including things like digital payment tools, website building and security, and marketing. This has been a great upsell opportunity for the company as it looks for new ways to help the entrepreneurs and small businesses it serves to grow in a new digital era. GoDaddy's business applications sales increased 20% in Q3 to $186 million, constituting just 19% of total revenue.  

Now what

In addition to solid expansion of the business, GoDaddy also completed an accelerated share repurchase program of $250 million in Q3. The company had an additional $750 million remaining on its current repurchase plan, worth nearly 6% of the current market cap.  

However, the outlook for Q4 does imply a slowdown is coming. Revenue guidance of $970 million represents 11% year-over-year growth. Nevertheless, at about 18 times trailing-12-month free cash flow, GoDaddy stock might appeal to investors looking for a value in the website management and e-commerce software space.