01—Abstract
Summary
Summary of the 10-Q filed April 24, 2025. Cited figures are marked; the original filing is the authoritative source.
VeriSign, Inc. reported first-quarter 2025 revenues of $402.3 milliona, up 5% from $384.3 million in the prior-year period, driven primarily by .com and .net price increases, partially offset by a decline in the .com and .net domain name base.
Operating income rose 5% to $271.2 millionb, net income was $199.3 million, and diluted earnings per share were $2.10 compared with $1.92 a year earlier. Net cash provided by operating activities was $291.3 million, versus $257.3 million in the prior-year quarter. The filing states that the domain name base stood at 169.8 million .com and .net registrations as of March 31, 2025, down 1.5% from March 31, 2024, though the company noted a net increase of 0.8 million registrations from December 31, 2024, and that business conditions began improving at the end of 2024.
The balance sheet remains in a stockholders' deficit of $1.98 billionc at March 31, 2025. During the quarter, the company issued $500.0 million of 5.25% senior notes due 2032 and used the proceeds, along with cash on hand, to repay its $500.0 million of 5.25% notes due April 1, 2025. Cash and cash equivalents rose to $575.4 million, and total cash and marketable securities were $648.5 million.
The company repurchased 1.0 million shares for $229.9 milliond under its buyback program, leaving $792.7 million available. On April 23, 2025, the Board declared a quarterly cash dividend of $0.77 per share, payable May 28, 2025, and the filing states the Board adopted a dividend program to begin in the second quarter of 2025. Management stated that the 2024 .com and .net renewal rate for the fourth quarter was 74.0% compared with 73.2% a year earlier, and that new registrations rose to 10.1 million from 9.5 million.
Operating expenses grew modestly, with selling, general and administrative expenses up 8% to $55.7 million. Investors may also note the filing's risk factors on the concentration of revenue in the .com and .net registry agreements, pricing constraints, and Chinese regulatory pressure on demand.
02—Key points
Key Highlights
- Revenue rose 5% to $402.3 million in Q1 2025 from $384.3 million, driven primarily by .com and .net price increases, partially offset by a decline in the domain name base.
- Operating income of $271.2 million and net income of $199.3 million, with diluted EPS of $2.10 versus $1.92 in Q1 2024.
- The .com and .net domain name base was 169.8 million at March 31, 2025, down from 172.5 million a year earlier, but up 0.8 million from December 31, 2024.
- New .com and .net registrations totaled 10.1 million, compared with 9.5 million in the prior-year quarter; the Q4 2024 final renewal rate was 74.0% versus 73.2%.
- Operating cash flow was $291.3 million, up from $257.3 million, while cash and cash equivalents rose to $575.4 million from $206.7 million at year-end 2024.
- The company issued $500.0 million of 5.25% senior notes due 2032 and repaid $500.0 million of notes due April 1, 2025, and repurchased $229.9 million of stock, with $792.7 million remaining under the program.
- A quarterly dividend of $0.77 per share was declared April 23, 2025, payable May 28, 2025, and the Board adopted a dividend program starting in Q2 2025; stockholders' deficit was $1.98 billion.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2025, Verisign kept $0.50.
- Revenue$402.3M100.0%
- Cost of revenue−$49.4M12.3%
- Gross profit$352.9M87.7%
- Operating costs−$81.7M20.3%
- Operating income$271.2M67.4%
- Interest, other & tax−$71.9M17.9%
- Net income$199.3M49.5%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed April 24, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $402.30M$384.30M | +4.7% |
| Cost of Revenue | $49.40M$49.10M | +0.6% |
| Gross Profit | $352.90M$335.20M | +5.3% |
| R&D Expenses | $26.00M$24.80M | +4.8% |
| SG&A Expenses | $55.70M$51.50M | +8.2% |
| Operating Expenses | $131.10M$125.40M | +4.5% |
| Operating Income | $271.20M$258.90M | +4.8% |
| Interest Expense | $20.30M$18.80M | +8.0% |
| Net Income | $199.30M$194.10M | +2.7% |
| EPS (Basic) | $2.11$1.93 | +9.3% |
| EPS (Diluted) | $2.10$1.92 | +9.4% |
| Shares Outstanding (Basic) | 94.60M100.80M | −6.2% |
| Shares Outstanding (Diluted) | 94.80M100.90M | −6.0% |
05—Questions
Frequently Asked Questions
What drove the increase in VeriSign's first-quarter 2025 revenue?
Revenues increased 5% to $402.3 million, primarily due to the .com and .net price increases, partially offset by a decline in the .com and .net domain name base. The U.S. and EMEA regions contributed most of the growth, while APAC revenue decreased slightly, reflecting a 7% decline in China.
Is the domain name base growing again?
The domain name base was 169.8 million at March 31, 2025, a 1.5% decrease from March 31, 2024, but a net increase of 0.8 million from December 31, 2024. Management said business conditions began to improve at the end of 2024 and continued into the first quarter of 2025, with more new registrations and higher renewal rates, though it described this as still early.
How is VeriSign returning capital to shareholders?
During the quarter the company repurchased 1.0 million shares for $229.9 million, leaving $792.7 million available under its repurchase program. The Board declared a $0.77 per share cash dividend on April 23, 2025, payable May 28, 2025, and adopted a dividend program intended to begin in the second quarter of 2025, subject to Board approval and market conditions.
What changes occurred in the company's debt during the quarter?
VeriSign issued $500.0 million of 5.25% senior unsecured notes due June 1, 2032, at 99.581% of par, on March 11, 2025. On March 31, 2025, it used the proceeds and cash on hand to repay all $500.0 million of its 5.25% notes due April 1, 2025. Total senior notes were $1,786.3 million in long-term debt at quarter-end, and the company had no outstanding credit facility borrowings.
What are the main risks highlighted in the filing?
The filing highlights reliance on the .com and .net registry agreements, which are the source of substantially all revenue, and the pricing constraints in those agreements. It also cites competition from alternatives such as social media and artificial intelligence, regulatory pressure in China that has reduced demand, cybersecurity and DDoS attacks, and dependence on registrars continuing to market domain names.
06—Continue