Investor Relations

Verisign is a global provider of domain name registry services and internet infrastructure.

CONNECT WITH US

U.S.: 1-800-922-4917

Int'l: 1-703-948-3447

email investors relations

Verisign Reports Second Quarter 2021 Results

July 22, 2021

RESTON, Va.--(BUSINESS WIRE)--Jul. 22, 2021-- VeriSign, Inc. (NASDAQ: VRSN), a global provider of domain name registry services and internet infrastructure, today reported financial results for the second quarter of 2021.

VeriSign, Inc. and its subsidiaries (“Verisign”) reported revenue of $329 million for the second quarter of 2021, up 4.8 percent from the same quarter in 2020. Verisign reported net income of $148 million and diluted earnings per share (diluted “EPS”) of $1.31 for the second quarter of 2021, compared to net income of $152 million and diluted EPS of $1.32 for the same quarter in 2020. The operating margin was 64.7 percent for the second quarter of 2021 compared to 65.8 percent for the same quarter in 2020.

“We’re pleased with the operational and financial results of the quarter as well as the continued efforts of our dedicated team. Last week we reached a new milestone for our critical internet infrastructure by marking 24 years of 100% availability in the .com/.net domain name resolution system,” said Jim Bidzos, Executive Chairman and Chief Executive Officer.

Financial Highlights

  • On June 8, 2021, VeriSign, Inc. issued $750 million aggregate principal amount of 2.700% Senior Notes due 2031. On June 23, 2021, VeriSign, Inc. used the net proceeds from the offering, together with cash on hand, to fund the redemption of all of its outstanding $750 million, 4.625% Senior Notes due 2023; as part of this redemption, Verisign recognized a loss on debt extinguishment of $2.1 million related to the unamortized debt issuance costs on the notes.
  • Verisign ended the second quarter of 2021 with cash, cash equivalents and marketable securities of $1.12 billion, a decrease of $44 million from the end of 2020.
  • Cash flow from operating activities was $143 million for the second quarter of 2021, compared to $215 million for the same quarter in 2020.
  • Deferred revenues as of June 30, 2021 totaled $1.11 billion, an increase of $50 million from the end of 2020.
  • During the second quarter of 2021, Verisign repurchased 0.8 million shares of its common stock for an aggregate cost of $172 million. As of June 30, 2021, there was $737 million remaining for future share repurchases under the share repurchase program which has no expiration date.

Business Highlights

  • Verisign ended the second quarter of 2021 with 170.6 million .com and .net domain name registrations in the domain name base, a 5.2 percent increase from the end of the second quarter of 2020, and a net increase of 2.59 million during the second quarter of 2021.
  • During the second quarter of 2021, Verisign processed 11.7 million new domain name registrations for .com and .net, compared to 11.1 million for the same quarter in 2020.
  • The final .com and .net renewal rate for the first quarter of 2021 was 76.0 percent compared to 75.4 percent for the same quarter in 2020. Renewal rates are not fully measurable until 45 days after the end of the quarter.

Today’s Conference Call

Verisign will host a live conference call today at 4:30 p.m. (EDT) to review the second quarter 2021 results. The call will be accessible by direct dial at (888) 676-VRSN (U.S.) or (786) 789-4772 (international), conference ID: Verisign. A listen-only live web cast of the conference call and accompanying slide presentation will also be available at https://investor.Verisign.com. An audio archive of the call will be available at https://investor.Verisign.com/events.cfm. This news release and the financial information discussed on today’s conference call are available at https://investor.Verisign.com.

About Verisign

Verisign, a global provider of domain name registry services and internet infrastructure, enables internet navigation for many of the world’s most recognized domain names. Verisign enables the security, stability, and resiliency of key internet infrastructure and services, including providing root zone maintainer services, operating two of the 13 global internet root servers, and providing registration services and authoritative resolution for the .com and .net top-level domains, which support the majority of global e-commerce. To learn more about what it means to be Powered by Verisign, please visit Verisign.com.

VRSNF

Statements in this announcement other than historical data and information constitute forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended. These statements involve risks and uncertainties that could cause our actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others, attempted security breaches, cyber-attacks, and DDoS attacks against our systems and services; the introduction of undetected or unknown defects in our systems; vulnerabilities in the global routing system; system interruptions or system failures; damage to our data centers; risks arising from our operation of root servers and our performance of the Root Zone Maintainer functions; any loss or modification of our right to operate the .com and .net gTLDs; changes or challenges to the pricing provisions of the .com Registry Agreement; new or existing governmental laws and regulations in the U.S. or other applicable foreign jurisdictions; economic, legal and political risks associated with our international operations; the impact of unfavorable tax rules and regulations; risks from the adoption of ICANN’s consensus and temporary policies, technical standards and other processes; the uncertainty of the impact of changes to the multi-stakeholder model of internet governance; the outcome of claims, lawsuits, audits or investigations; the effects of the COVID-19 pandemic; our ability to compete in the highly competitive business environment in which we operate; changes in internet practices and behavior and the adoption of substitute technologies, or the negative impact of wholesale price increases; our ability to expand our services into developing and emerging economies; our ability to maintain strong relationships with registrars and their resellers; our ability to attract, retain and motivate our highly skilled employees; and our ability to protect and enforce our intellectual property rights. More information about potential factors that could affect our business and financial results is included in our filings with the SEC, including in our Annual Report on Form 10-K for the year ended Dec. 31, 2020, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Verisign undertakes no obligation to update any of the forward-looking statements after the date of this announcement.

©2021 VeriSign, Inc. All rights reserved. VERISIGN, the VERISIGN logo, and other trademarks, service marks, and designs are registered or unregistered trademarks of VeriSign, Inc. and its subsidiaries in the United States and in foreign countries. All other trademarks are property of their respective owners.

 

VERISIGN, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except par value)

(Unaudited)

   

 

 

June 30,
2021

 

December 31,
2020

ASSETS

 

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

 

$

216,497

 

 

 

$

401,194

 

 

Marketable securities

 

906,492

 

 

 

765,713

 

 

Other current assets

 

66,078

 

 

 

51,033

 

 

Total current assets

 

1,189,067

 

 

 

1,217,940

 

 

Property and equipment, net

 

247,694

 

 

 

245,571

 

 

Goodwill

 

52,527

 

 

 

52,527

 

 

Deferred tax assets

 

66,441

 

 

 

67,914

 

 

Deposits to acquire intangible assets

 

145,000

 

 

 

145,000

 

 

Other long-term assets

 

40,651

 

 

 

37,958

 

 

Total long-term assets

 

552,313

 

 

 

548,970

 

 

Total assets

 

$

1,741,380

 

 

 

$

1,766,910

 

 

LIABILITIES AND STOCKHOLDERS’ DEFICIT

 

 

 

 

Current liabilities:

 

 

 

 

Accounts payable and accrued liabilities

 

$

175,350

 

 

 

$

208,642

 

 

Deferred revenues

 

822,984

 

 

 

780,051

 

 

Total current liabilities

 

998,334

 

 

 

988,693

 

 

Long-term deferred revenues

 

289,881

 

 

 

282,838

 

 

Senior notes

 

1,784,654

 

 

 

1,790,083

 

 

Long-term tax and other liabilities

 

86,296

 

 

 

95,494

 

 

Total long-term liabilities

 

2,160,831

 

 

 

2,168,415

 

 

Total liabilities

 

3,159,165

 

 

 

3,157,108

 

 

Commitments and contingencies

 

 

 

 

Stockholders’ deficit:

 

 

 

 

Preferred stock—par value $.001 per share; Authorized shares: 5,000; Issued and outstanding shares: none

 

 

 

 

 

 

Common stock and additional paid-in capital—par value $.001 per share; Authorized shares: 1,000,000; Issued shares: 354,071 at June 30, 2021 and 353,789 at December 31, 2020; Outstanding shares: 112,001 at June 30, 2021 and 113,470 at December 31, 2020

 

13,949,525

 

 

 

14,275,160

 

 

Accumulated deficit

 

(15,364,476

)

 

 

(15,662,602

)

 

Accumulated other comprehensive loss

 

(2,834

)

 

 

(2,756

)

 

Total stockholders’ deficit

 

(1,417,785

)

 

 

(1,390,198

)

 

Total liabilities and stockholders’ deficit

 

$

1,741,380

 

 

 

$

1,766,910

 

 

   

VERISIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands, except per share data)

(Unaudited)

   

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

 

2021

 

2020

 

2021

 

2020

Revenues

 

$

329,405

 

 

 

$

314,365

 

 

 

$

653,026

 

 

 

$

626,889

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

Cost of revenues

 

47,796

 

 

 

43,608

 

 

 

94,764

 

 

 

89,181

 

 

Sales and marketing

 

10,221

 

 

 

8,890

 

 

 

18,705

 

 

 

15,494

 

 

Research and development

 

19,808

 

 

 

18,202

 

 

 

40,119

 

 

 

35,560

 

 

General and administrative

 

38,601

 

 

 

36,885

 

 

 

76,052

 

 

 

73,610

 

 

Total costs and expenses

 

116,426

 

 

 

107,585

 

 

 

229,640

 

 

 

213,845

 

 

Operating income

 

212,979

 

 

 

206,780

 

 

 

423,386

 

 

 

413,044

 

 

Interest expense

 

(23,064

)

 

 

(22,535

)

 

 

(45,598

)

 

 

(45,070

)

 

Non-operating (loss) income, net

 

(2,041

)

 

 

7,403

 

 

 

(1,597

)

 

 

14,487

 

 

Income before income taxes

 

187,874

 

 

 

191,648

 

 

 

376,191

 

 

 

382,461

 

 

Income tax (expense) benefit

 

(40,102

)

 

 

(39,169

)

 

 

(78,065

)

 

 

104,134

 

 

Net income

 

147,772

 

 

 

152,479

 

 

 

298,126

 

 

 

486,595

 

 

Other comprehensive (loss) income

 

(87

)

 

 

(2,000

)

 

 

(78

)

 

 

263

 

 

Comprehensive income

 

$

147,685

 

 

 

$

150,479

 

 

 

$

298,048

 

 

 

$

486,858

 

 

 

 

 

 

 

 

 

 

 

Earnings per share:

 

 

 

 

 

 

 

 

Basic

 

$

1.31

 

 

 

$

1.32

 

 

 

$

2.64

 

 

 

$

4.20

 

 

Diluted

 

$

1.31

 

 

 

$

1.32

 

 

 

$

2.64

 

 

 

$

4.19

 

 

Shares used to compute earnings per share

 

 

 

 

 

 

 

 

Basic

 

112,387

 

 

 

115,347

 

 

 

112,757

 

 

 

115,861

 

 

Diluted

 

112,517

 

 

 

115,544

 

 

 

112,905

 

 

 

116,137

 

 

 

VERISIGN, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

 

 

Six Months Ended June 30,

 

2021

 

2020

Cash flows from operating activities:

 

 

 

Net income

$

298,126

 

 

 

$

486,595

 

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

Depreciation of property and equipment

23,577

 

 

 

22,841

 

 

Stock-based compensation

26,591

 

 

 

23,428

 

 

Other, net

4,398

 

 

 

(8,101

)

 

Changes in operating assets and liabilities:

 

 

 

Other assets

(18,602

)

 

 

(10,146

)

 

Accounts payable and accrued liabilities

(36,787

)

 

 

25,796

 

 

Deferred revenues

49,976

 

 

 

30,430

 

 

Net deferred income taxes and other long-term tax liabilities

(6,435

)

 

 

(175,471

)

 

Net cash provided by operating activities

340,844

 

 

 

395,372

 

 

Cash flows from investing activities:

 

 

 

Proceeds from maturities and sales of marketable securities

1,482,952

 

 

 

995,194

 

 

Purchases of marketable securities

(1,623,566

)

 

 

(1,167,680

)

 

Purchases of property and equipment

(24,270

)

 

 

(21,891

)

 

Proceeds received related to sale of business

 

 

 

20,009

 

 

Net cash used in investing activities

(164,884

)

 

 

(174,368

)

 

Cash flows from financing activities:

 

 

 

Repayment of borrowings

(750,000

)

 

 

 

 

Proceeds from senior note issuance, net of issuance costs

742,329

 

 

 

 

 

Repurchases of common stock

(361,199

)

 

 

(429,826

)

 

Proceeds from employee stock purchase plan

8,101

 

 

 

8,296

 

 

Net cash used in financing activities

(360,769

)

 

 

(421,530

)

 

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(364

)

 

 

(965

)

 

Net decrease in cash, cash equivalents, and restricted cash

(185,173

)

 

 

(201,491

)

 

Cash, cash equivalents, and restricted cash at beginning of period

410,601

 

 

 

517,601

 

 

Cash, cash equivalents, and restricted cash at end of period

$

225,428

 

 

 

$

316,110

 

 

Supplemental cash flow disclosures:

 

 

 

Cash paid for interest

$

48,718

 

 

 

$

43,708

 

 

Cash paid for income taxes, net of refunds received

$

98,993

 

 

 

$

26,472

 

 

 

Investor Relations: David Atchley, datchley@verisign.com, 703-948-4643
Media Relations: James Barbour, jbarbour@verisign.com, 703-948-3800

Source: VeriSign, Inc.