How Is Web.com Likely To Grow In The Next 2 Years?

March 19th, 2018 by Trefis Team
WEB: Web.com Group logo
WEB
Web.com Group

Web.com (NASDAQ:WEB) has seen impressive growth in recent years, as its revenue grew at 17% annually. As more and more companies rely on digitally growing their business, Web.com’s strong position in the domain registration market and focus on small businesses should help it continue its strong growth in the near term.

We expect Web.com’s revenues to increase by around 6% annually over the next two years. We have created an interactive dashboard which shows our forecasts for the company’s revenues. You can modify the different revenue drivers to see how changes impact the company’s expected revenues.

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Web.com’s Segment Revenue Growth

Subscription revenues have grown at 12% annually, driven by 2% and 15% annual growth in users and average revenue per user, respectively. A strong position in the global domain registration business and the acquisition of Yodle, DonWeb and TORCHx should further boost the segment’s revenues in the near term.

The Professional Services business includes custom web design, e-commerce store design, and support services. The segment’s revenue has declined marginally over the past couple of years. As more and more small and medium businesses are going online, we expect substantial growth from this segment.

 

We expect a marginal decline in EBITDA margin over the next 2 years as the company realizes the costs related to recent acquisitions.

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