VeriSign Inc ( VRSN Quick Quote VRSN - Free Report) announced that domain name registrations increased 8.7 million or 2.6% year over year across all top-level domains in the fourth quarter of 2022. Sequentially, domain name registrations were up 0.1% to 350.4 million.
The company continues to benefit from healthy growth across .com and .net domain name registrations and growing Internet consumption globally. VeriSign provides Internet infrastructure services, including domain name registry services and infrastructure assurance services.
In the fourth quarter, the .com and .net TLDs increased by 0.3 million domain name registrations, or 0.2%, year over year to 173.8 million. Also, the .com and .net domain name bases totaled 160.5 million and 13.2 million domain name registrations, respectively, for the quarter ended Dec 31, 2022.
The company processed 9.7 million new domain name registrations for .com and .net compared with 10.6 million in the prior-year quarter. VeriSign saw a decrease in new units in the fourth quarter due to many factors, which included lower first-time renewal rates, unfavorable year-over-year comparisons, uncertainty related to global macroeconomic conditions and relative weakness in 2022 registrations from China.
The company provided tepid 2023 guidance due to uncertainty prevailing over global macroeconomic conditions and geopolitical instability. VeriSign expects 2023 revenues between $1.485 billion and $1.505 billion. The company’s domain name base’s growth is expected to remain flat to up 2.5%.
The company reported fourth-quarter 2022 adjusted earnings of $1.70 per share, which beat the Zacks Consensus Estimate by 11.1%. VRSN had reported earnings of $2.97 in the prior-year quarter.
Revenues jumped 8.5% year over year to $369 million and beat the Zacks Consensus Estimate by 0.3%.
The company also announced that it would increase the annual registry-level wholesale fee for each new and renewal .com domain name registration from $8.97 to $9.59, with effect from Sep 1, 2023.
VeriSign currently has a Zacks Rank #4 (Sell).
Stocks to Consider
Some better-ranked stocks in the broader technology space are
Arista Networks ( ANET Quick Quote ANET - Free Report) , Perion Network ( PERI Quick Quote PERI - Free Report) and Pegasystems ( PEGA Quick Quote PEGA - Free Report) , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Arista Networks’ 2023 earnings is pegged at $5.79 per share, rising 11.6% in the past 60 days. The long-term earnings growth rate is anticipated to be 14.2%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 14.2%. Shares of ANET have increased 24% in the past year.
The Zacks Consensus Estimate for Perion’s 2023 earnings is pegged at $2.69 per share, rising 16% in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
Perion’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 31.7%. Shares of PERI have increased 69.3% in the past year.
The Zacks Consensus Estimate for Pegasystem’s 2023 earnings is pegged at $1.31 per share, rising 96% in the past 60 days.
Pegasystem’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters, the average surprise being 11.2%. Shares of PEGA have declined 37.2% in the past year.