Category Archives: .net

Verisign Q1 2013 Report: net 1.99 million more .com/.net, 8.8 million new registrations, 15% revenue growth

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VeriSign, Inc. reported financial results for the first quarter ended March 31, 2013. Verisign got a 15% year-over-year revenue growth in Q1 2013. The domain related numbers are:

  • Verisign Registry Services added 1.99 million net new names and ended the first quarter with 123.1 million active domain names in the zone for .com and .net, representing a 5.5 percent increase year over year.
  • In the first quarter, Verisign processed 8.8 million new domain name registrations as compared to 8.9 million for the same quarter a year prior.

To make a comparison with Q4 2012, Verisign Registry Services only added 1.25 million net new names in the fourth quarter of 2012 and the new .com and .net registrations totaled 7.9 million. It seems that 2013 started with a bang…

Here is the complete report:

VeriSign, Inc. (NASDAQ: VRSN), the global leader in domain names, today reported financial results for the first quarter ended March 31, 2013.

First Quarter GAAP Financial Results
VeriSign, Inc., and subsidiaries (“Verisign”) reported revenue of $236 million for the first quarter of 2013, up 15 percent from the same quarter in 2012. Verisign reported net income of $85 million and diluted earnings per share (EPS) of $0.52 for the first quarter of 2013, compared to net income of $68 million and diluted EPS of $0.42 in the same quarter in 2012. The operating margin was 56.4 percent for the first quarter of 2013 compared to 48.1 percent for the same quarter in 2012.

First Quarter Non-GAAP Financial Results
Verisign reported, on a non-GAAP basis, net income of $94 million and diluted EPS of $0.58 for the first quarter of 2013, compared to net income of $68 million and diluted EPS of $0.42 for the same quarter in 2012. The non-GAAP operating margin was 59.6 percent for the first quarter of 2013 compared to 51.9 percent for the same quarter in 2012. A table reconciling the GAAP to the non-GAAP results (which excludes items described below) is appended to this release.

“The first quarter demonstrates our continued focus and discipline in the execution of our strategic framework,” commented Jim Bidzos, executive chairman, president and chief executive officer.

“We are pleased with the successful completion of our $750 million senior unsecured notes offering,” stated George Kilguss III, senior vice president and chief financial officer.

Financial Highlights

  • On April 16, 2013, Verisign issued $750 million of 4.625% Senior Notes due May 2023. Verisign used a portion of the proceeds from the offering to repay the $100 million in outstanding indebtedness under its existing revolving credit facility and intends to use the remaining amount for general corporate purposes, including, but not limited to, the repurchase of shares under its share repurchase program.
  • Verisign ended the first quarter with Cash, Cash Equivalents, Marketable Securities and Restricted Cash of $1.57 billion, an increase of $9 million from year-end 2012.
  • Cash flow from operations was $151 million for the first quarter compared with $110 million for the same quarter in 2012.
  • Deferred revenues on March 31, 2013, totaled $847 million, an increase of $34 million from year-end 2012.
  • Capital expenditures were $17 million in the first quarter of 2013.
  • During the first quarter, Verisign repurchased approximately 3.0 million shares of its common stock for a cost of approximately $132 million. At March 31, 2013, approximately $844 million remained available and authorized under the current share repurchase program.
  • For purposes of calculating diluted EPS, the first quarter diluted share count included 7.9 million shares related to the subordinated convertible debentures, compared with 2.5 million shares in the same quarter in 2012. These represent diluted shares and not shares that have been issued.
  • Due to the stock price exceeding the subordinated convertible debentures trigger price during the first quarter of 2013, holders have the option to convert the debentures into common stock during the second quarter of 2013. Consequently, the debt component of the subordinated convertible debentures, the related embedded derivative, and deferred tax liability were reclassified from long-term liabilities to current liabilities, while the associated unamortized debt issuance costs were reclassified from long-term assets to current assets, as of March 31, 2013.

Business Highlights

  • Verisign Registry Services added 1.99 million net new names and ended the first quarter with 123.1 million active domain names in the zone for .com and .net, representing a 5.5 percent increase year over year.
  • In the first quarter, Verisign processed 8.8 million new domain name registrations as compared to 8.9 million for the same quarter a year prior.

Non-GAAP Items
Non-GAAP financial results exclude the following items that are included under GAAP: discontinued operations, stock-based compensation, amortization of other intangible assets, impairments of goodwill and other intangible assets, restructuring charges, contingent interest payments to holders of the subordinated convertible debentures, unrealized gain/loss on contingent interest derivative on subordinated convertible debentures, and non-cash interest expense. Non-GAAP financial information is also adjusted for a 28 percent tax rate starting from the third quarter of 2012, and 30 percent for the other periods presented herein, both of which differ from the GAAP tax rate. A table reconciling the GAAP to non-GAAP operating income and net income is appended to this release.

About Verisign
As the global leader in domain names, Verisign powers the invisible navigation that takes people to where they want to go on the Internet. For more than 15 years, Verisign has operated the infrastructure for a portfolio of top-level domains that today include .com, .net, .tv, .edu, .gov, .jobs, .name and .cc, as well as two of the world’s 13 Internet root servers. Verisign’s product suite also includes Distributed Denial of Service (DDoS) Protection Services, iDefense Security Intelligence Services and Managed DNS. To learn more about what it means to be Powered by Verisign, please visit VerisignInc.com.

Verisign’s 2012 Q4 Domain Data: 252 million domains worldwide, 121 million .com and .net (INFOGRAPHIC)

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Yesterday, Verisign released the latest issue of the Domain Name Industry Brief, which showed that the Internet grew by more than six million domain names in the fourth quarter of 2012. The total number of registered domain names now stands at more than 252 million, which represents a 2.5 percent growth rate over the third quarter of 2012. This marks the eighth straight quarter with greater than 2 percent growth.

More than six million domain names were added to the Internet in the fourth quarter of 2012, bringing the total number of registered domain names as of Dec. 31, 2012, to more than 252 million worldwide across all Top-Level Domains (TLDs), according to the latest Domain Name Industry Brief.

The order of the top TLDs in terms of zone size changed slightly when compared to the third quarter. In Q4’2012, the largest TLDs in terms of base size were, in order: .com, .de (Germany), .net, .tk (Tokelau), .uk (United Kingdom), .org, .cn (China),  .info,.nl (Netherlands) and .ru (Russian Federation).

The base of Country Code Top-Level Domains (ccTLDs) was 110.2 million domain names, a 5 percent increase quarter over quarter, and a 21.6 percent increase year over year in the base.

The .com and .net TLD registrations experienced a 6.4 percent increase over Q4’2011, bringing the combined total number of domain names in the adjusted zone to approximately 121.1 million. New .com and .net registrations totaled 8.0 million during the fourth quarter of 2012. In the fourth quarter of 2011, new .com and .net registrations totaled 7.9 million.

The .com and .net renewal rate for the third quarter of 2012 was 72.9 percent, up from 72.5 percent in the third quarter of 2012.

Verisign’s average daily Domain Name System (DNS) query load during the fourth quarter of 2012 was 77 billion, across all TLDs operated by Verisign, with a peak of 123 billion. Compared to the third quarter of 2012, the daily average increased 16 percent and the peak increased 20.4 percent.

The order of the top TLDs in terms of zone size changed slightly when compared to the third quarter, as .cn (China) moved up a ranking from the eighth largest TLD to the seventh largest TLD, resulting in .info moving down one ranking. All other TLDs in the top 10 maintained their rankings.

infographic-dnib-april2013The latest issue of the Domain Name Industry Brief also offers a high-level overview of the challenges and opportunities that big data presents companies of all sizes. “Big Data Can Pose Big Challenges, and Opportunities, for Organizations” also includes a synopsis of the data generated within the DNS, and how companies could use this data to inform business strategy and possibly improve network security.

Not everything is about .COM

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.COM is king but not everything is about .com. There are still many opportunities in other gTLDs and ccTLDs. I had an intense 24 hours in domaining and my day didn’t involve too much of .com.

At first I got a call from one of the top 5 companies in the world (US based) that wanted to buy one of my .info domain names. My wife answered the call and gave me the phone to talk. The caller only told me his name, so I didn’t know for what company he was working for at that time. When he told what domain name he was interested in I knew he wouldn’t like my price. I can’t disclose the domain name but it wouldn’t be so hard to guess.

I asked him if he had an offer and he said that he wanted to hear my price first. I started telling him that I have declined a lot of 5 figure offers for this domain in the past few years. He interrupted me and told me that he only had an offer for $5,000 USD. So we left it at that and hung up. Don’t think for a moment that the 5 figure offers were a sales pitch. I have actually received these offers.

Then I got back on my PC only to find an email that the caller had send before he called me. He had send the same offer but it was then when the company he was working for was revealed. I didn’t know the company when I talked to him on the phone but my price was and is going to be the same. No matter who calls, my price will be the same for this particular domain. I don’t think this is over just yet…

On the same day I got an offer through DomainNameSales.com for a .org domain from one of the largest and most known UK associations. They are interested in buying a .org domain name I own.

Again on the same day I sold a .net domain at Sedo to a US individual and got a decent offer on a 3 letter .biz domain.

Finally I got an inquiry for a 3 letter .org that I am not willing to sell as it relates to my wife’s line of work. I am currently negotiating a lease for this domain.

And because most of the domains above haven’t produced any results yet here is what domains I have sold so far this year:
3 .com
3 .info
2 .org
1 .net
1 .us

All sales were for $1500 and up and only 4 of the 10 domain sales have been reported. All the others were private.

I must admit that I have a pretty diverse portfolio and that my .info portfolio is at least above average but my results must be very interesting. Don’t you think?

.COM is king and will be for many years to come but not everything is about .com.

Verisign Declines Voluntary Participation in the .net Contractual Compliance Audit Requested by ICANN

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ICANN (Internet Corporation for Assigned Names and Numbers) requested from Verisign (the .com and .net registry operator) a contractual compliance audit for the .net TLD.

With a letter dated 8 of January 2013 to ICANN, Verisign declined the invitation to coluntarily participate in  the audit. Verisign explained that it has no obligations under its .net registry agreement with ICANN to comply with the proposed audit. So absent such express constractual obligations. Verisign will not submit itself to an audit by or at the direction of ICANN of its books and records.

Verisign says that it will welcome the opportunity yo cooperate with ICANN in the future in any audits of TLDs operated by Verisign for which the applicable registry agreement contains sufficient audit rights.

It seems that Verisign is a bit defensive after the .com registry renewal that will not allow Verisign to increace the .com price for the next 6 years.

.net price increases to $5.62 on July 1, 2013 and at $8.20 until 2017

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Verisign announced today that the .net registry fee will be increased from $5.11 to $5.62. This price does NOT include the $0.75 ICANN fee. So the actual wholesale fee paid by the registrars will be $6.37. Verisign’s target certainly is to reach the .net price at $8.20 until 2017.

Verisign is allowed by it’s contract with the Internet Corporation for Assigned Names and Numbers (ICANN) to increase the registry price for .net 10% every year. The last price increase for .net was done on January 15th 2012. Price went up 10%: from $4.65 to $5.11.

On November 30th Verisign, Inc., the registry operator for .com, got it’s contact renewed for another 6 years. The U.S. Department of Commerce approved the renewal of Verisign’s agreement with ICANN with the contract running from December 1st, 2012 to November 30th, 2018. Although Verisign got the contract renewal, it lost the right to raise the wholesale price of .com for the next 6 years. In the previous contract running from 2006 up to 2012 Verisign was able to raise .com prices 4 times.

This puts pressure on Verisign to increase revenue and of course the easy way out is to increase .net prices by 10% every single year until 2017. The .net contract expires on the 1st of July 2017. So the expected 2017 .net price will be: $8.20. That will be higher that the current .com price that will stay at $7.85 until 2018. (.net has a much higher ICANN fee that is not included in these prices)

This is the complete press release from Verisign:

Verisign Announces Increase in .Net Registry Fee

RESTON, VA–(Marketwire – Dec 19, 2012) – VeriSign, Inc. (NASDAQ: VRSN), the trusted provider of Internet infrastructure services for the networked world, today announced, effective July 1, 2013, an increase in the registry domain name fee for .net top-level domain names, per its agreement with the Internet Corporation for Assigned Names and Numbers (ICANN).

As of July 1, 2013, the registry fee for .net will increase from $5.11 to $5.62.