2015-07-23

Verisign Q2 2015 Earnings Results, Conference Call, July 23, 4:30 ET

"Well, I think if you just look at the numbers for dot-com and the net adds, you'll see that being the powerful brand that it is, it's still growing quite briskly. So I think those numbers speak for themselves. Dot-com is the reliable brand and people are choosing great names in it and the registration numbers are strong. It's in demand and people are registering dot-coms and, of course, needless to say, all of the global brands are on dot-com and I don't expect that to change."--D. James Bidzos - Executive Chairman, President & CEO, Verisign, Inc. VeriSign (VRSN) Q2 2015 Results - Earnings Call Transcript | Seeking Alpha (emphasis added)
Slide from Verisign Q2 2015 Earnings Call
Verisign Inc. VRSN 5-year stock chart
Verisign Inc. VRSN 5-year stock chart (source: google.com)
Verisign hosted a live teleconference call on July 23, 2015, at 4:30 p.m. (EDT). An audio archive of the call is available at https://investor.verisign.com/events.cfm.

Q2 2015 Verisign NASDAQ: VRSN Earnings Conference Call
Principal Domain name: verisigninc.com

Second Quarter GAAP Financial Results
VeriSign, Inc. and subsidiaries ("Verisign") reported revenue of $263 million for the second quarter of 2015, up 4.9 percent from the same quarter in 2014. Verisign reported net income of$93 million and diluted earnings per share of $0.70 for the second quarter of 2015, compared to net income of $100 million and diluted EPS of $0.71 in the same quarter in 2014. The operating margin was 56.7 percent for the second quarter of 2015 compared to 57.2 percent for the same quarter in 2014.

Second Quarter Non-GAAP Financial Results
Verisign reported, on a non-GAAP basis, net income of $99 million and diluted EPS of $0.74 for the second quarter of 2015, compared to net income of $96 million and diluted EPS of $0.68 for the same quarter in 2014. The non-GAAP operating margin was 61.3 percent for the second quarter of 2015 compared to 60.9 percent for the same quarter in 2014. A table reconciling the GAAP to the non-GAAP results (which excludes items described below) is appended to this release.

"I am pleased to report another quarter in which we have created and delivered value for our shareholders," commented Jim Bidzos, Executive Chairman, President and Chief Executive Officer.

Financial Highlights
  • Verisign ended the second quarter with cash, cash equivalents and marketable securities of $1.9 billion, an increase of $460 million as compared with year-end 2014.
  • Cash flow from operations was $175 million for the second quarter of 2015, compared with $121 million for the same quarter in 2014.
  • Deferred revenues on June 30, 2015, totaled $932 million, an increase of $41 million from year-end 2014.
  • Capital expenditures were $9 million in the second quarter of 2015.
  • During the second quarter, Verisign repurchased 2.5 million shares of its common stock for $156 million. At June 30, 2015, $761 million remained available and authorized under the current share repurchase program which has no expiration.
  • For purposes of calculating diluted EPS, the second quarter diluted share count included 17 million shares related to subordinated convertible debentures, compared with 11.3 million shares in the same quarter in 2014. These represent diluted shares and not shares that have been issued.
Business Highlights
  • Verisign Registry Services added 0.52 million net new names during the second quarter, ending with 133.5 million .com [118.5 million] and .net [15 million] domain names in the domain name base, which represents a 3.1 percent increase over the base at the end of the second quarter in 2014, as calculated including domain names on hold for both periods.
  • In the second quarter, Verisign processed 8.7 million new domain name registrations for .com and .net, as compared to 8.5 million for the same period in 2014.
  • The final .com and .net renewal rate for the first quarter of 2015 was 73.4 percent compared with 72.6 percent for the same quarter in 2014. Renewal rates are not fully measurable until 45 days after the end of the quarter.
  • Verisign announces an increase in the annual fee for a .net domain name registration from$6.79 to $7.46, effective Feb. 1, 2016, per its agreement with the Internet Corporation for Assigned Names and Numbers. (ICANN).
Non-GAAP Items
Non-GAAP financial results exclude the following items that are included under GAAP: stock-based compensation, unrealized gain/loss on contingent interest derivative on subordinated convertible debentures, and non-cash interest expense. Non-GAAP net income is decreased by amounts accrued, if any, during the period for contingent interest payable resulting from upside or downside triggers related to the subordinated convertible debentures and is adjusted for an income tax rate of 26 percent for 2015 and 28 percent for 2014, both of which differ from the GAAP income tax rate. A table reconciling the GAAP to non-GAAP operating income and net income is appended to the earnings release.

Verisign investor website: investor.verisign.com
Events & Presentations - VeriSign, Inc.

"About Verisign: Verisign, a global leader in domain names and Internet security, enables Internet navigation for many of the world's most recognized domain names and provides protection for websites and enterprises around the world. Verisign ensures the security, stability and resiliency of key Internet infrastructure and services, including the .com and .net domains and two of the Internet's root servers, as well as performs the root-zone maintainer functions for the core of the Internet's Domain Name System (DNS). Verisign's Security Services include intelligence-driven Distributed Denial of Service Protection, iDefense Security Intelligence and Managed DNS. To learn more about what it means to be Powered by Verisign, please visit VerisignInc.com." (source Verisign) 

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