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VeriSign Gains on Higher Domain Name Registrations in Q2

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VeriSign’s (VRSN - Free Report) latest The Domain Name Industry Brief report stated that domain name registrations increased almost 6 million or 1.8% sequentially to 339.8 million across top-level domains (TLDs) at the end of the second quarter. Domain name registrations increased roughly 7.9 million or 2.4% year over year.

On a combined basis, .com and .net TLDs increased 3.7% year over year and 0.9% sequentially to approximately 149.7 million at the end of the second quarter. Verisign is the exclusive registrar of the .com, .net and .name domains per its agreements with The Internet Corporation for Assigned Names and Numbers (ICANN).

In the last reported quarter, revenues increased 4.8% from the year-ago quarter and 1.1% sequentially to $302 million. The company anticipates preliminary renewal rate to be 74.9%, up from 74% reported in the year-ago quarter.

Notably, per its agreement with ICANN, the annual fee for a .net domain name registration has been increased from $8.20 to $9.02 effective Feb 1, 2018.

VeriSign has returned 33.5% on a year-to-date basis compared with the industry’s decline of 9.5%.



 

New Registrations Details

As of Jun 30, 2018, the .com domain name base totaled approximately 135.6 million domain name registrations. The .net domain name base registrations totaled roughly 14.1 million. VeriSign reported that .com continued to maintain its position as the largest TLD, followed by .cn (China) and .tk (Tokelau).

New .com and .net registrations were 9.6 million compared with 9.2 million in the year-ago quarter.

VeriSign noted that growth of .com and .net domain names redirecting to Facebook’s (FB - Free Report) Instagram, Etsy (ETSY - Free Report) , LinkedIn and Twitter (TWTR - Free Report) was 61%, 12%, 9% and 5%, respectively, from the year-ago quarter.

New gTLD (“ngTLD”) registrations increased 7.9% sequentially but declined 10.4% year over year to 21.8 million. The top 10 ngTLDs represented 51.2% of all ngTLD domain name registrations.

As of Jun 30, 2018, there were 44 ngTLDs delegated that have a geographical focus and more than 1,000 domain name registrations since entering general availability (GA).

Country Code Top-Level Domains Increase

Country Code Top-Level Domains (“ccTLDs”) increased 3.8% year over year and 2.4% sequentially to 149.7 million.

Excluding .tk, ccTLD domain name registrations increased approximately 1.5% sequentially and 2.5% year over year.

As of Jun 30, 2018, the top 10 ccTLDs were .cn (China), .tk (Tokelau), .de (Germany), .uk (United Kingdom), .ru (Russian Federation), .nl (Netherlands), .br (Brazil), .eu (European Union), .fr (France), and .it (Italy).

Moreover, there were 302 global ccTLD extensions delegated in the root zone including Internationalized Domain Names (IDNs), with the top 10 ccTLDs composing 65.7% of all ccTLD domain name registrations.

VeriSign Raises Domain Name Base Growth Guidance

VeriSign provided a raised guidance for its domain name base growth rate for 2018. The company now anticipates the same to grow between 3.5% and 4.25%, up from the prior guidance of 2.5-3.3%.

For the third quarter, VeriSign projects domain name base registration to increase in the range of 1.3 million to 1.8 million.

VeriSign currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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