GoDaddy Inc. ($GDDY)

Great. There's a question of how you monitor for AI disruption. And whether that's something that you could potentially monitor for within the current customer base? And then as you look at your prospects, your funnel, what are you looking for? I'm sure everybody is trying to look around the corner and see are there any any hints that the business being disrupted. What are the signs that you're looking for internally of that one way or the other?

Yes. So we continue to follow a lot of data. There's no doubt about it. We've been around for 30 years. We have 14 million interactions with our customers per year through our care organization, we get 1.9 billion signals from our technology stack around our customers' activity. So every single day. So we monitor a lot. We monitor the top of the funnel. We monitor our strategy around how our customers are buying in the purchase path and attaching and most importantly, activating the products and getting value out of those products. Now that dynamic has remained stable. And that dynamic continues to drive a very strong top of the funnel, and like I said, we -- when we get to that second product, the third product, the faster we get, which our Arrow platform has been allowing our cost to do with our customers, we get to that high retention rate in that LTV. So this is a great time. Innovation, when it's happening all around you, just raises the bar to what you need to do and how you need to service your customers. There is no doubt we are in an age of a lot of innovation, a lot of things coming out quickly. Our key here, our moat is to focus on our customer base. And when you're talking the mom-and-pop shop versus, I would say, going enterprise level, you're talking about a specific need, which we've done great for a long time and we'll continue to do.

Yes, the core need state of micro small business is for me consistent. They're looking to bring an idea to market, converse with their customers, sell to their customers and accept payment for those tools, and they want to do it in a simple one-stop shop solution and with our distribution channel, our strong brand aware is uniquely situated to be able to deliver for these Microsoft business customers. .

Got it. I think stepping back a bit, there's the sense that we've seen more elevated growth in domains in the market generally. And there's that question of, well, I think you've participated in Q4, right? But more generally, should GoDaddy have a bigger piece of that on an ongoing basis. And so is that customer that you see coming into the market today, they're experimenting with Vibe coding? Are they not the traditional go-to Andy customer, some of this incremental growth that you're seeing in the market -- what's your view on that?

So when we talk about the incremental growth in domains, you have to take a step back and look at it from a broad view. There is no doubt that where we are today with AI and innovation that it is drawing more people online than we've seen in the past. We saw that in Q1. Other companies have talked about seeing it as well. One, I will point out, we are still the largest domain player out there. We were in Q4, we are in Q1. Our percentage of share of that is absolutely the same, and we continue to focus on that. We do focus on high-intent customers, not just domain customers. There are other elements in those numbers. Like you said, there probably is some some people coming on and experimenting with some other areas. There are also investors coming into the market and they're buying bulk domain names now, right, because they're speculating that these domains will gain value. I think the important part to note is coming out of Q4, a lot of people were questioning whether the domain was going to remain relevant. -- in the new AI world. And I think what we're seeing now, it's not only remaining relevant, it's becoming a priority because the agents still have to act and be able to go places and go get content, and you need your real estate on the Internet and that real estate is owned by the domain name itself. So now what we're seeing is a pivot to the domain is becoming an important top of the funnel. And that's exactly what we do. I mean that's the company we built, and we've been around for 30 years doing. We know the domain space, and we'll continue to focus on that. I will say that some of the statistics you do have to take in its broad sense and then take it down to who are the customers you're really going after, who are the customers that we want within our funnel, how are we getting to the high intent customer that's going to convert and stay with us for a long period of time. And we feel we are very well designed to do that not only now but going into the future.

Got it. I think Aman made a comment, I think it was on the Q1 call. about some pressure top of funnel from AI or AI mode or some of the things going on in the market, but an offset from conversion. Just wondering if you could talk a little bit more about that dynamic. And then particularly, I think that -- so my experience is maybe seem to almost concentrate the possibilities of whose link you're likely to click on. So I mean, are you seeing that Charvoice become more consolidated, GoDaddy, maybe being a beneficiary of that? And then maybe if you could talk through the conversion gains that as well as sort of offsetting the volume hurdle.

Yes. So I'll start, and I know Christy has some thoughts around this, so I'll let her go as well. On the conversion part of it, we are definitely seeing higher conversion, as Aman said, at the top of the funnel because we are continuing to go after that high-intent customer. So when we get to that high intent customer, there's no doubt that our strategy is working. When it comes to how customers are getting or how high intent customers are getting to us, there's definitely change. I mean we have the part of 60% of our traffic comes to us naturally, right to Go Daddy, not through any other sources because of our brand in the domain space. So we always start at a very advantageous point within the market. But there's no doubt that other 40% is changing and shifting through different sources right now. This happened when Google Search came as well. You had to shift and modify how you handle search and how you market it and what terms you used in order to make sure you were the beneficiary of traffic that was coming in. And today, we're continuing to do that. It's through different sources, through different LLM, but you have to be able to monitor what those systems are picking up, how they're attracting those customers, what is getting presented and then you have to make sure you're doing what you do on your part to make sure that, that could change. In 5 years ago with Google, you had to monitor how that search was working. And if Google [Audio Gap] I have to make sure that how you are presenting your bundles, your packages, what your buy lines are is getting picked up in the most advantageous ways by the LLM and then if something shifts out there, you have to be able to notice the shift and look at the downstream impact and then adjust. I think this is something the industry has done very well for a number of years now and will continue to do well, and I expect people will continue to adjust accordingly to make sure that they're getting to the right traffic, right, not all traffic, but the right traffic. And that's the key here with us is -- we want to make sure that our algorithms are getting to the right traffic and not necessarily just all the traffic.

Yes. I mean I think you summed -- you said it well, and I'll just sum it up we benefit from having the largest brand awareness in the space and the the technology or the ways in which you attract traffic to your funnel has and always will continue to evolve, and we can continue to optimize to drive that traffic to our website. That's just the nature of being a company. and that's what we focus on. .

Got it. I wanted to ask a little bit about from a marketing perspective, brand share voice perspective, how you sort of view bridging a general cat maybe. I mean GoDaddy, of course, is top of mind in the bands for people mice. Maybe that's evolving. But for Gen Z, for Genie creators, Genscreators, -- how is that evolving? Are you seeing that the brand is enduring and that you have as much share of voice as you did in previous generations?.

Yes, absolutely. So our marketing campaigns do actually focus the changing perceptions or the changing ways in which all users are -- or engaging with the Internet, the traffic. It's kind of along the lines of what we were just talking about in the last question, right? So trying to optimize for the traffic and high-intent customers is top of mind for us and that spans the generations of -- the need state, of course, is still the same. I want to get an idea to market. I want to talk to customers. I want to collect payments for it. And there are specific marketing that we have in market that are intended to attract different types of generation Gen Z, Y in all different -- the iterations of generation that exists out there that that are looking to bring their ideas to market. So you see some more of that with things like in social for the younger generation. So things that are in Instagram and TikTok and YouTube. So you see us participate in all of those types of areas that attract youger audiences.

Finances SP1 And more to come, right? We are refining our marketing campaign. We continue to look at what's going to attract, again, the right customers and the right volume in there. And I think -- as you suggested, we've really benefited from a strong brand for a number of years, but we also recognize we need to continue to evolve and continue to be a company that's at the forefront of everybody's minds.

Got it. So I want to go back to ARO AI Builder and the ramp that you're doing on the launch, the ramp that you're doing now, you're supporting that with some paid marketing. So -- what's the strategy ultimately whether or not to bring that into the sort of main GoDaddy Put in a bigger way drives that decision? .

So thanks because it's a distinction that I don't think lands all the time with investors that we have godaddy.com, which is our traditional purchase path. -- but ARO AI builders sits on Arrow.ai. It's not in the purchase path today and GoDaddy.com. Now you can get to aro.aifrom godaddy.com, but it's not something that's presented to you in the checkout process or along those lines. Right now, we're focused on organic traffic to Arrow. AI and engagement and buying the premium packages on ARO. AI and people activating and using it and consuming the tokens, which we've seen great and paying for the token -- great momentum. At some point, when we feel comfortable, we will introduce ARO AI Builder into GoDaddy.com as burning the purchase path. We want to do it pragmatically and purposely. We want to make sure that we're getting the best customer experience. Because any time you introduce something new into the purchase path, you have to be very conscious of what the customer is going to choose at that point in time? And is there a decision point between maybe websites plus marketing, and we've talked about we're upgrading that product as well and make sure that we're doing and knowing what the customer behavior is so we can optimize for that traffic path. We're not there yet. -- we're focused on Aro.ai. The marketing we talked about is to drive traffic to Arrow. AI. We'll do that for the remainder of the year. We'll see how the engagement, how the premium plans are working what customer benefits are getting to, and then we'll look to launch that at some point onto the godaddy.com when it makes sense.

I was going to ask this later, but you mentioned a couple of times tokens and how is the cost. Yes. So that's an irresistible topic. So gross margin, I think famously for some of the boding the next-generation biting solutions has been negative. -- maybe positive if you squint and eliminate the token costs associated with new customer acquisition. But how are you managing that? I know you've talked about -- or baths talked about utilizing modern Bedrock and some of those solutions. But are you continuing to see that cost curve been down? I think there's sort of active debate about -- do the frontier must become more commoditized and the cost curve continues to be sort of been down? Or does -- are the harness and the model so closely coupled that it's going to be harder to sort of generate efficiencies through model routing and things like that. What's your opinion?

So I'll start with when we launched Arro.AIbuilder, from day 1, it's been profitable for us. We're doing it in a manner that we are trying to match the consumption even on the token basis to what our customers are paying and do things very thoughtfully to not get ahead of ourselves and not jump into the market where we don't understand the dynamics of how it's going to affect our P&L, what ultimately that's going to look like. We are in a very beneficial spot that our consolidated technology stack, which sits on top of our usage allows us to monitor and control not only the volume that goes to the LLMs. But also which LLM is used for what purpose and match it up to the pricing that we've put out into the market. The idea of being you don't always need the best LM to provide every service, some services can be provided at a lower price using a different -- we also have the benefit of a lot of data ourselves that we use within the statistics I talked about, the 20 million customers, the $14 million interactions, the $1.2 billion signals we get daily. It does create a proprietary data point for us, which allows us to monitor what is really needed externally and make sure that we're using our proprietary data first to provide whatever need is out there for our customers before having to ping into an LLM right off the bat. So that all has been set up for a number of years for us. And a matter of fact, we've been talking about this for years. When we talked about consolidating our technology stack several years ago, -- it wasn't with the foresight that AI would come in to play this quickly in 2026. But the fact that we did it allows us to control our environment very thoroughly and be very efficient. So as we look out into the future, and I'm not talking about 2027 just yet, but we will at some point, -- we look at our ability to utilize not only the internal operations and the benefits we're getting, but use that to make sure that we're staying ahead of ourselves on the cost basis. It comes back to the 33% we talked about. -- we didn't know this was going to be upon us in 26 when we set out that marker, but even in 2024. But now that, that market is out there, we feel very comfortable even with the launch of ARO AI Builder coming into 2026 that we're able to be profitable and put that into market and look at how the premium packages are working and look at the data usage that's there. Again, it's something that needs constant monitoring. I'm not saying it isn't something that is evolving over time, but we feel really good about our ability to control it and control it within our environment. it's also good to recognize our customer base, right? And again, this sometimes gets lost in the conversation. A lot of the other players are going into enterprise where the people who use their products aren't the people who actually cut the check on the back end. Our customers actually use the product and have to pay the bill, right? So they are seeing the benefit they're getting versus what's getting charged to their credit card. They're matching it up and making sure that it makes sense for them. And in that dynamic, we feel really good about our ability to make sure that we're keeping that unit profitability in line with our customer needs because it's a very unique customer base in and of itself.

And I think one other thing I'll add to is what you've long seen from us is cost and P&L discipline, and that's something that we have we'll continue to have strong focus. .

Okay. I guess there's thought to be this balancing act between do you give people enough of the taste of what the capabilities are, what it can do for them versus what it costs -- do you feel like you have that balance right now?

Right now, yes. But I will say this is where the uniqueness of having the relationship with your customer is important because you have to monitor that customer behavior and acknowledge what they're getting the value for versus what they're willing to spend. and I've said repeatedly, 2 things in technology industry, you have to continue to have in order to get ahead of the curve. You have to be able to innovate and you have to have the customer relationship. If you understand your customers' needs and you have the ability to innovate, you continue to stay ahead, and that's what we're doing with ROA builder. We're looking at what their needs are, matching the product and what their needs are and then building the cost structure around it to make sure it's profitable, but it meets their needs.

Okay.. So I want to jump back into customer acquisition, the 499 offer. And I make controversial, maybe I don't know maybe controversial among investors or controversial my sell side. But -- so when you looked at the -- it seemed like you were responding to the environment, maybe taking maybe taking advantage of something that you saw opportunistically in the environment in Q4. You've pulled back a little bit in Q1 throughout that, I think, well, in Q4, you really said, okay, these are still customers that are in our wheelhouse of high-intent customers. Did your view change or evolve with respect to that and you decided to sort of be a little bit less promotional or the promotion is still out there, but maybe share a little bit less frequently or give it a little less play in the channels. Maybe just take us through the narrative, first of all.

Yes, absolutely. So it's almost taken back a year. We identified a high-intent customer that we believed was willing to spend that was incremental to our current traffic -- our current customer conversion that was not only willing to spend in a 1-year term, but also willing to attach products faster within that 1-year term. And as we monitor the activation and our experimentation, we saw those customers were the exact customers we're trying to attract. They were coming in, they wanted a 1-year term, but they wanted to attach a second product, a third product very, very fast. And this was incremental to some of the other pricing we had put out there the 3-year we decided to experiment and go with the famous 99, not the controversial the fame 499, I'd like to say. And it worked. It attracted the customer we wanted the high intent who is activating to that second and third product. So in Q4, we put marketing dollars behind it, and it really worked. It was landing people on that page for the 499 in discount. Now remember, the $499 is only available to a new customer buying their first domain. So if you're an existing customer, and you went after the $499, you would get kicked into the regular pricing, right? So it worked as designed, but it kicked a lot of people into the 1-year terms. The modification we made in the first quarter was to make sure that when the 1-year term offer for 499 was coming up, that existing customers weren't getting kicked into a 1-year term, they were also getting the option to do the normal 3-year term. So now remember, we've had a discounting of a 3-year term for a domain for a number of years. You get the first year for set. You have to sign up for 3 years, it cost you $45 upfront. Putting that option along with the $4.99 was the balance we were looking for within the front of site. And that allowed us now to make sure that we -- we're not only getting the new customers for the 499 existing customers who are clicking into that $4.99, we're going back to the usual 3-year terms when they were buying their domains in and up itself. So that balance obviously, we talked about the impact in Q1 and how it would roll out through the year. But we looked at it as being very successful, but chose to modify it and make sure that we were making that balance between the 1-year term and the 3-year term was an option for our customers, and there wasn't a default to just 1 direction they needed to go. So -- go ahead.

I think 1 of the things that gets lost is that when we're talking about this offer, 1 of the things that we've talked about is it's driving strong traffic like Mark talked about, is stridentrong conversion. It's driving strong attach activation. And all of these are strong indicators that these are high intent customers, which is great. But the thing I think that gets lost is that means that these -- all these customers are up for renewals sooner, which is certainly a little bit of a risk, but it's also a pretty big opportunity for areas like pricing and bundling or when you think about VeriSign has a new price increase that they're about to do. These customers are now eligible for that price increase 2 years sooner than anyone who's on a 3-year. So there is different opportunities that are often missed the benefits of these 1-year cohorts.

Well, I'll take us down that diversion. So can you talk about that renewal motion. I think you've talked about in the past, okay, you have a customer that looks at 3 plans among a selection, good, better, best. And they think better and then next year, you move that into good. Can you talk about the renewal motion then any numbers you want to put around that, but just the opportunity that you see around renewal. And interesting that you bring up that, that accelerates that opportunity.

Yes. So think about our pricing and bundling initiative and think about our ability to touch our customers and do exactly what you just described. in a 1-year term, we have a quicker ability to get that pricing and bundling opportunity in front of our customer more naturally through the renewal cycle. The other thing very important to acknowledge and Christi said it, and I'll just repeat it because I think it's very, very worthwhile point. Pricing and value delivery for this -- for us, for everybody in this industry is on the renewal, not on the new customer. You want the new customer in, you offer them special pricing to come in. That didn't change with whatever VeriSign does. -- you have the ability now to raise the prices and get it to where it needs to be in the second year and then the third year. And the more renewal cycles, you can hit faster, the more you're going to be able to make sure that, that stays in balance. If you have a 3-year term the first time you can touch the pricing on that renewal is with -- at the end of the 3-year term. It just takes longer to get there. When you're now in a motion of attaching products faster and you have other products associated with that renewal, you have the ability now to offer up not only pricing and bundling it better value points for them. as we introduce new products into the entrepreneurs, wheel, we're having a better natural touch point with that renewal cycle coming faster. And this is where we see a huge incrementality to how we drive the LTV equation going forward. And what you're seeing today is our, I would say, -- we're not going to just sit here and watch our customers and try the same thing over and over again. We're going to continue to be aggressive and go after that high-intent customer and make sure that we're getting the right traffic, we're converting the right customers. We're getting the right products in front of them. getting value out of those products, and we will continue to look at different opportunities to push that equation into the future. Why? Because we know when those customers come in and have that behavior. We've talked about it for years, the 1x domain, when we get to that fourth product, it's 83x the LTV that drives that compounding cash flow over time that drives the value we return to the shareholders. And it's not about trying to get there in 1 quarter. It's about building it over a period of time to make sure that we're continuing to grow the company pragmatically towards our North Star.

In a sustainable way. I'll go further down this path just for a moment. So -- what role is Arrow having in the renewal cycle at this point? Is it material in the renewal cycle? Is that then you're servicing for people in a significant way?

So and just to clarify, ARO AI Builder because we recently won the capability. Yes, yes, is not at that having an impact on our renewal cycle. We are seeing people sign up for more tokens, which is great, right? They're burning through their initial tokens, they're getting in their packages and then coming back and getting more tokens to consume. So we're very excited about that momentum. Arrow in and of itself, the play the capability for the GoDaddy customer. We've seen the behavior we wanted to see. And to put it in perspective, we got rid of deep discounting at the top of the funnel in the end of 2023. When we go back and measure the customers that were coming in at the beginning of 2024, which is when we launched Arrow on the godaddy.com website. When we look at those customers that came in at that point versus the previous customers, we see the higher retention rates that we've talked about. We see them renewing at stronger -- a stronger percentages doing exactly what we thought they were going to do. They're getting more products. They're building the LTV, they're staying on with us longer. That sometimes gets lost in the data metrics, but we've talked about customers, and we've talked about everything we've done in the past few years to dispose of or end-of-life certain products. And we've obviously talked about the impact on the customer numbers related to that. We've maintained around 85% retention rate within our customer base, even though we were disposing business units, even though we were end-of-lifing products and making decisions to do that, and you look -- think about that for the last 2 years, our ability to maintain that is because we know that cohort that started coming in, in 2024 is much stronger than the previous cohorts that were coming in pre-arra.

And Arrow is essentially helping getting customers to that attached 30% faster than they were pre aero, right? So that happens at the new when they're coming in and at renewal, we're able to present. We're able to present a suite of products and solutions for customers in a way that is easy for them to touch, feel and experience what their full build-out on upshot can look like if they have more products to attach or something that more closely resembles the goals that they're trying to achieve. -- with our online build, and Arrow helps us get there. And to Mark's point, we're able to curate stronger high-intent customer base that is those high LTV customers.

Okay. Why don't go down another diversion here end of life. I mean, so talk a little bit about the headwind that you've seen there? And then also, I mean, is there anything else that's a candidate for Andis just you feel like you've done there?

Yes nothing to call out at this point. I will say product cycles and evaluation is a constant muscle. I think everybody should have, we definitely have. We will always review the entrepreneurs wheel, the products we're offering and making sure that they meet the customers' needs. And if we don't believe they're meeting their needs, then we will make a decision on whether we need to end of life or do something else at that point in time. and we will allocate resources to where we think we need to be to deliver value to our customers. So that is a muscle that will happen, I would say, is run the business going forward. We did a lot in the last few years. I would say we accelerated a few things based on that new strategy that we put forth in our 2024 plan that we talked about back then from time to time, we may call out that we end of life this or we end of life that and made a decision. We'll be very transparent about it. we see our ability to make those decisions because we're not planning for the short term. We're playing for the long term. And we know as long as we're making the right decisions and right choices about where we allocate our resources to meet our customer needs, that we'll be able to continue to own that relationship, innovate around it, get to that LTV equation. And because I love free cash flow, drive the free cash flow number that we've talked about.

We've got about 12 something like that minutes left. Just wanted to check and see if we might have had any questions in the audience.

This is the early morning crew out here. I appreciate this.

Okay. We'll go ahead please.

So you guys also have the distortion of presenting in the $80 billion SP1 Yes.

Yes. Sometimes timing is everything.

Going back to just some of this incremental growth in the domain market. there's some amount of the synchronal growth is or domains attaching to applications. Are you seeing that? Are you seeing that be a tailwind for your business? And that something you expect to kind of capture on those over as -- and so it's definitely something I repeat the question. sorry.

Because he's not on Mike. Question -- so the -- I would say you're asking about the reverse attach, right, where people are coming into the applications and attaching the domain versus going for the domain and then attaching product to it. Are we seeing that as a trend. The answer is yes. We're seeing that with an Arrow AI builder. People start with the interaction around the Agentic agent. -- and that agent brings to them the domain name in and of itself. So that is the muscle within the ARO AI Builder in and of itself. Now it's early stage, so I'm not calling it out as a driver going into the rest of 2026 by any means. -- but it is definitely a behavior that is out there within the ARO AI builder in and of itself, which I would think will continue into the future.

Does having your own AI builder prohibit you from picking up some of that from the other bond coders. You have some private competitors out there who are global pickup on the main side partnerships with some of the boots partnership strategy on that vector? Or you double down on having your own solution and people?

So I'll start with -- we've never been shy about partnerships. We have some very large partnerships, Microsoft being 1 of them. So there is no challenge with us having and having relationships with third parties. For us, partnerships, though, I mean you have to share the value. And then sharing the value, that means it has to be incremental to our business model and have an ability to drive our business model and our LTV going forward. In other words, we're open to good partnerships. If those are presented, we would always have a conversation, but we're not open just to having partnerships in and of itself for the sake of having.

I guess that gets back to whether -- the question of whether or not that customer is part of the core or somebody that you've traditionally seen. So the person who's brewing up something on clad Code and downloading that to a gatorepository and then looking for a host and a domain. I mean maybe it could be part of the customer set at some point. But I'd imagine it's not...

Micro small business customers that we serve because you're talking about someone who is a lot more sophisticated or technology savvy than our typical micro small business customer. Does that mean that, that's not available to us in the future and we're always looking to expand the user base of who's using our customers, but we remain focused on those micro small business customers and delivering a one-stop-shop solution for them. That's super important for -- as a microsales that wears many hats and they're every day their jobs to be done. There are so many things that they're trying to manage while also just doing their actual passion and what their job is. So handling all of this back-end technology is where GoDaddy wins, it's where GoDaddy succeeds and it's where we deliver for our customers. And it's why we have strong retention. That's why we have a strong oil customers because they want a single dashboard to manage all of these things not trying to cobble together a bunch of different?

So we'll try to dig into the numbers a little bit. So you've seen some revenue growth deceleration. Clearly, some predatory headwinds versus maybe some more structural things here in the market. I don't know if you tell me, but maybe you could talk us through some of the headwinds that you're experiencing that you view as sort of temporary versus what sort of core growth -- and we've called these out and they haven't changed from what coming out of Q4. There were decisions made around our core platform, the Doco contract, we decided not to go forward with a renewal that we knew we is going to create a headwind -- we've always called out the aftermarket. We saw great activity in 2025 on large transactions within the aftermarket. They may or may not return at any point in 2026. -- but they can always make a little bit of a headwind depending on what quarter we're comping and when some of those deals were recorded for us. We talked about the $499, which we talked about how that would roll out for the remainder of the year. And then we talked about that we were pausing pricing on pricing and bundling websites marketing upgrade. Those are all temporary in our mind. They will flow through in different manners through this year, very much all of them were going to hit the front end of the year and then tail off as we went through the remainder of the year at different rates. But those are ideally where we see it now. Some of those impact bookings, some of them do impact revenue a little bit, some of the bookings, but then the timing of the revenue is just the same because the 1-year the upfront cash on the 1 year is less than the upfront cash on the 3-year, but the revenue attributes remain pretty similar absent the discount in the $499. So there's different aspects that flow through at different times between our bookings and our revenue I always come back to, despite all those ins and outs and headwinds. We came forward with $1.8 billion target for our free cash flow for the year. Free cash flow for us is driven by the bookings upfront. And we feel really good about our $1.8 billion on our ability to meet that target. And regardless of all the headwinds on the bookings and the timing of all this, we remain steadfast that we're going to continue to hit that free cash flow number, which translated means that we feel good that this is going to wash out in different periods. But when you look over a period of time, it remains fairly consistent. And then I would be remiss if I didn't acknowledge again, that's why we feel good about, hey, we grew free cash flow per share, 27% in the first quarter, 27% now. if you break that down in and of itself. Even with the $499, when you think about that, half of that came from increase in free cash flow, half of that came from buying back shares at an incremental rate. So our ability to there is being driven by both our business and our capital allocation strategy, which is, again, working together to make sure we continue this journey well beyond 2026.

So I want to go back to the free cash flow growth in a second, we don't have a little bit of time left. But A&C growth in double digits has come down a little bit. I just wanted to ask how do you feel about the durability of that, maintaining double-digit growth for A&C?

Is that something you still feel led about I don't want to get into the future. We're going to have an investor event later in the year and we'll start to lay out what the future looks like, but we do feel good about our momentum. -- and we do feel good about the LTV equation that we've talked about, and we'll continue to push.

So with the free cash flow growth that free cash flow per share growth at that level, you're certainly building cash up. Do you look at a broader array of sort of capital allocation options as that continues to build, -- anything else? -- look attractive to you beyond your own shares, obviously, which are Yes.

Yes. So our strategy and how we apply capital allocation hasn't changed. It remains the same. And I always say that because, one, when you look at buying back our shares as a key tool to returning value to our shareholders. And then obviously, everybody will ask, is there M&A opportunities out there? And the answer is there's always opportunities, but it has to fit within our model. It has to be accretive to our model. And what we have found over the last few years is that our ability to innovate internally and come out with products like our AI Builder in and of itself. -- has raised the bar on what could work within an M&A situation for us. We always say it has to be strategic, it has to be financially accretive and has to be able to be integrated. That comes very efficiently for us for our own innovation cycle right now and our ability to get that value from any M&A just sometimes the numbers don't work. So it's not that we don't get a lot of calls on different opportunities because we have such a strong balance sheet, but we've been very disciplined that it has to fit within that model, and it has to be able to be something that will continue the LTV journey for us in the future.

Okay. Well, I think don't we wrap it up there. That was great. Great Place Thanks. Thanks.

We have Mark [indiscernible] That is right. That is today. I forgot about the.

Congratulations. Happy ever.

Thanks so much. Thanks, Robert Bye.