VeriSign Banks On Domain Name Registration, Reports Q1 Data
Zacks Investment Research | Jun 25, 2018 11:22PM ET
VeriSign’s (NASDAQ:VRSN) latest The Domain Name Industry Brief stated that domain name registrations increased 0.4% sequentially to 333.8 million across top-level domains (TLDs) at the end of the first quarter. Domain name registrations increased 3.2 million or 1% year over year.
Country Code Top-Level Domains (“ccTLDs”) increased 2.2% year over year and 0.1% sequentially to 146.3 million in the December quarter. On a combined basis, .com and .net domain names increased 3.2% year over year to approximately 148.3 million in the first quarter.
Reportedly, new .com and .net registrations were 9.6 million compared with 9.5 million in the year-ago quarter. VeriSign reported that .com continued to maintain its position as the largest TLD, followed by .cn (China) and .tk (Tokelau).
The company notes that growth of .com and .net domain names redirecting to Facebook (NASDAQ:FB) , Snap’s (NYSE:SNAP) Snapchat, Twitter (NYSE:TWTR) was 12%, 11% and 9%, respectively, from the year-ago period. Facebook owned Instagram garnered highest growth of 70%.
New gTLD (“ngTLD”) registrations decreased 2% year over year to 20.2 million, representing 6% of total domain name registrations. ngTLD declined 20.7% year over year.
Domain Registration Scenarios
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).
The company's top line is driven by increasing domain name registration coupled with price hikes for domain names. 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 is also currently engaged in the ICANN process regarding the further delegation of .web. Management noted that the guidance for 2018 does not take into consideration .web as it is still uncertain whether operations will commence this year.
On the last conference call, VeriSign provided a raised guidance for its domain name base growth rate for 2018. The company now anticipates the same to grow between 2.5-3.3%, up from the prior guidance of 2-3%. For the second quarter, VeriSign projects domain name base registration to increase in the range of 0.7 million to 1.2 million.
The company continues to benefit from strong demand in the United States as well as in international markets. Management noted that growing penetration of Internet and sustained growth of e-commerce were the key growth drivers.
However, a significant headwind for VeriSign is soft growth in active domain name business for .com and .net TLDs.
Get The News You Want
VeriSign currently has a Zacks Rank #3 (Hold). You can see Zacks Investment Research
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.