MOUNTAIN VIEW, CA - August 6, 2009 - VeriSign, Inc. (NASDAQ: VRSN), the trusted provider of Internet infrastructure services, today reported financial results for the second quarter ended June 30, 2009.
On a GAAP basis, VeriSign reported revenue of $257 million from continuing operations for the second quarter of 2009. On a GAAP basis, VeriSign reported net income attributable to VeriSign, Inc. and subsidiaries of $35 million and earnings per share attributable to VeriSign, Inc. and subsidiaries of $0.18 on a fully-diluted basis.
On a GAAP basis, VeriSign reported segment revenue for Internet Infrastructure and Identity Services, or the "core businesses" of Naming Services and Authentication Services, of $255 million for the second quarter of 2009, up 1% from the prior quarter and up 9% year-over-year. GAAP core operating margin for the second quarter was 32.6%.
On a non-GAAP basis (which excludes items described below) for its core businesses, VeriSign reported net income attributable to VeriSign, Inc. and subsidiaries of $61 million for the second quarter of 2009 and fully-diluted earnings per share of $0.31. Non-GAAP operating margin for the second quarter was 38.4%. A table reconciling the GAAP to the non-GAAP results reported above is appended to this release.
"Under economic conditions that continue to make our environment a challenging one, we have delivered another successful quarter while, at the same time, refocusing the company," said Jim Bidzos, VeriSign executive chairman and chief executive officer on an interim basis. "We continue to make progress with our divestiture program, with only two of thirteen businesses left to divest."
"We believe our positive results this quarter and for the past several quarters validate our key position in critical Internet infrastructure services," said Mark McLaughlin, president and chief operating officer of VeriSign. "Billions of times each day, VeriSign technologies bring trust to the Internet. We believe that the continued growth of Internet usage, concurrent cyberattacks and fraud further underscore the importance of our services."
"We had a very good quarter, fueled by strong 9% year-over-year revenue growth in our core businesses," said Brian Robins, chief financial officer of VeriSign. "The macroeconomic environment continues to be challenging, but our results this quarter on the top and bottom line speak to the resiliency of our business model."
(1)As originally published, this press release contained the statement "Achieves 29% Core Earnings Per Share Growth Year-Over-Year." This statement was inaccurate and investors should not rely upon it in evaluating the Company's performance for the period ended June 30, 2009. The Company is hereby amending and restating this statement in this Earnings Release to state "Achieves 19% Non-GAAP Earnings Per Share Growth Year-Over-Year and Year-over-Year GAAP Earnings per Share Growth of 151%." No other revisions are being made to this Earnings Release.
Please see the last page of this Earnings Release for an additional table presenting the reconciliation of GAAP to non-GAAP net income for the three and six months ended June 30, 2008. The non-GAAP presentation for 2008 has been conformed to the non-GAAP presentation for 2009 by excluding the same items under GAAP for both periods. In addition to the change from "core" to "non-GAAP" earnings per share growth, the difference between the initial statement in this Earnings Release and the amended and restated statement is due to the fact that our 2009 non-GAAP presentation no longer includes other non-recurring items, which consisted of litigation reserves of $6.4 million previously included in our 2008 non-GAAP presentation.
Business and Corporate Highlights
Non-GAAP results exclude the following items that are included under GAAP: discontinued operations, non-core businesses in continuing operations, stock-based compensation, amortization of other intangible assets, impairments of goodwill and other intangible assets, and restructuring costs. Non-GAAP financial information is also adjusted for a 30% tax rate which differs from the GAAP tax rate. A table reconciling the GAAP to non-GAAP net income is appended to this release.
Today's Conference Call
VeriSign will host a live teleconference call today at 2:00 p.m. (PDT) to review the second quarter results. The call will be accessible by direct dial at (888) 676-VRSN (U.S.) or (913) 312-0965 (international). A listen-only live web cast and accompanying slide presentation of the earnings conference call will also be available at http://investor.verisign.com. A replay of this call will be available at (888) 203-1112 or (719) 457-0820 (passcode: 1455250) beginning at 7:00 p.m. (PDT) on August 6 and will run through August 13. This press release and the financial information discussed on today's conference call are available on the Investor Relations section of the VeriSign website at http://investor.verisign.com.
VeriSign, Inc. (NASDAQ: VRSN) is the trusted provider of Internet infrastructure services for the networked world. Billions of times each day, VeriSign helps companies and consumers all over the world engage in communications and commerce with confidence. Additional news and information about the company is available at www.verisign.com.
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 VeriSign's actual results to differ materially from those stated or implied by such forward-looking statements. The potential risks and uncertainties include, among others, the uncertainty of future revenue and profitability and potential fluctuations in quarterly operating results due to such factors as increasing competition and pricing pressure from competing services offered at prices below our prices, market acceptance of our existing services and the current global economic downturn, the inability of VeriSign to successfully develop and market new services, the uncertainty of whether new services as provided by VeriSign will achieve market acceptance or result in any revenues, the risk that planned divestitures of certain businesses may be delayed or pending dispositions may not be completed, may generate less proceeds than expected or may incur unanticipated costs or otherwise negatively affect VeriSign's financial condition, results of operations or cash flows, and the uncertainty of whether Project Titan will achieve its stated objectives. More information about potential factors that could affect the Company's business and financial results is included in VeriSign's filings with the Securities and Exchange Commission, including in the Company's Annual Report on Form 10-K for the year ended December 31, 2008, 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 press release.