Verisign ends 1st quarter of 2017 with 143.6 million .com and .net domain names

VeriSign, Inc. (NASDAQ: VRSN), reported financial and domain name registration results for the first quarter of 2017.

The final .com and .net renewal rate for the fourth quarter of 2016 was 67.6 percent compared with 73.3 percent for the same quarter in 2015. That is not that bad considering a lot of Chinese registrations expired.

VeriSign, Inc. and subsidiaries (“Verisign”) reported revenue of $289 million for the first quarter of 2017, up 2.4 percent from the same quarter in 2016. Verisign reported net income of $116 million and diluted earnings per share (diluted “EPS”) of $0.94 for the first quarter of 2017, compared to net income of $107 million and diluted EPS of $0.82 for the same quarter in 2016. The operating margin was 60.7 percent for the first quarter of 2017 compared to 59.2 percent for the same quarter in 2016.

Business Highlights

• Verisign ended the first quarter with 143.6 million .com and .net domain name registrations in the domain name base, a 1.0 percent increase from the end of the first quarter of 2016, and a net increase of 1.4 million during the first quarter of 2017.
• In the first quarter, Verisign processed 9.5 million new domain name registrations for .com and .net, as compared to 10.0 million for the same quarter in 2016.
• The final .com and .net renewal rate for the fourth quarter of 2016 was 67.6 percent compared with 73.3 percent for the same quarter in 2015. Renewal rates are not fully measurable until 45 days after the end of the quarter.

Financial Highlights

• Verisign ended the first quarter with cash, cash equivalents and marketable securities of $1.8 billion, a decrease of $12 million from year-end 2016.
• Cash flow from operations was $148 million for the first quarter of 2017, compared with $150 million for the same quarter in 2016.
• Deferred revenues on March 31, 2017, totaled $1.01 billion, an increase of $37 million from year-end 2016.
• During the first quarter, Verisign repurchased 1.8 million shares of its common stock for $150 million. At March 31, 2017, $920 million remained available and authorized under the current share repurchase program which has no expiration.
• For purposes of calculating diluted EPS, the first quarter diluted share count included 21.3 million shares related to subordinated convertible debentures, compared with 21.1 million shares for the same quarter in 2016. These represent dilutive shares and not shares that have been issued.