Are one bright spot for Endurance — Domain names

Revenue dips overall but domain business grows.

Endurance International Group (NASDAQ: EIGI) noted first quarter earnings ahead of the bell this morning.

Revenue dropped year-over-year from $295.1 million in Q1 2017 to $291.4 million in Q1 of this year. Its subscriber base fell from 5.304 million to 5.011 million.

The rollup of hosting, domain and email marketing firms was hard hit in the web presence business. Its hosting firms, which include BlueHost and HostGator, lost 8% of their subscriber base over the past year. Revenue dropped from $164.0 million in Q1 2017 to $155.0 million in Q1 2018. Numbers were also down quarter-over-quarter.

Endurance has traditionally paid very sizable affiliate referral fees to keep its hosting business growing. It will be interesting to see if it changes this strategy.

While year-over-year email marketing revenue was up, it was down in Q1 compared to Q4 2017. Subscriber numbers also fell year-over-year, so the revenue bump came from higher revenue per subscriber.

The lone bright spot was the domain name business, which includes Domain.com, BuyDomains, ResellerClub and many smaller brands. Revenue ticked up $0.6 million in Q1 compared to Q1 last year, and $0.8 million compared to Q4 2017. Q1 is traditionally a strong quarter in the domain name business.

With all of its brands combined, Endurance is the third largest domain name registrar with regarding 12 million domains registered.