Verisign lowers guidance again following domains shrink in Q2
Firm now expects domain base to drop by 2.0-3.0 million this year.
Verisign has lowered its forecast for the year following domain registrations disappointed again in Q2.
The firm ended the quarter with 170.6 million .com and .net domain name registrations, a drop of 1.8 million over the quarter. The domain base is down 2.2% year over year.
Verisign processed 9.2 million fresh .com registrations during the quarter, compared to 10.2 million in the same quarter a year ago.
The firm now expects the domain base to shrink by 2.0 to 3.0 million this year. Just last quarter, it predicted a drop of 1.75 million to growth of 0.25 million. At the beginning of the year, it expected a drop of 1.0 million to an increase of 1.0 million.
The firm made more money than a year ago despite selling less product. Thanks to price increases, Verisign’s revenue grew 4.1% to $387 million.
It also generated more cash. With high profit margins, Verisign’s board authorized the repurchase of another $1.11 billion of stock.
On yesterday’s investor conference call, Verisign fielded questions regarding a letter Republican lawmakers sent to the NTIA regarding .com pricing.
The firm stated that the contract automatically renews unless the NTIA cancels it, in which case the firm will continue to contract with ICANN. It also stated that the terms can’t be changed without mutual agreement between the NTIA and Verisign.
Verisign also gave its talking points when it faces pushback over pricing: the unregulated registrar market has been increasing its prices at higher rates than Verisign, and the secondary aftermarket is completely unregulated, with prices many times higher than the wholesale price.
