Verisign Raises Outlook as Domain Growth Accelerates
The domain-name registry operator ended the quarter with 179.1 million .com and .net registrations.
Verisign Inc. (VRSN), the domain-name registry operator, reported second-quarter revenue of $434.6 million, up 6.0% from a year earlier, as registration activity strengthened.
Revenue growth slowed from 6.6% in the first quarter and 7.5% in the fourth quarter, even as the.com and.net domain base expanded at its fastest year-over-year rate in the five-quarter comparison. The base grew 5.1%, accelerating from 3.7% in the first quarter.
Operating income increased 5.6% to $296.3 million, trailing revenue growth and narrowing the operating margin to about 68.2% from roughly 68.5% in the prior quarter. Net income rose 4.4% to $216.5 million, while diluted earnings increased 7.7% to $2.38 a share as the diluted share count declined.
Quarterly net additions climbed to 3.05 million from 2.54 million in the first quarter and 1.58 million in the fourth quarter. New.com and.net registrations rose about 22% from a year earlier to 12.7 million, extending a sequential increase across the prior three quarters.
The first-quarter renewal rate, the latest available measure, improved to 76.3% from 75.5% a year earlier and 75.0% in the fourth quarter. The year-over-year improvement narrowed to 0.8 percentage point from 1.0 point in the preceding reported period.
Verisign raised its full-year 2026 guidance, though the provided release excerpt didn't include the revised range. The.web top-level domain has been delegated with Verisign as registry operator, and the company expects to offer.web domains through its registrar channel later in 2026.
Operating cash flow rose about 15% from a year earlier to $232 million, reversing the first quarter's year-over-year decline. Verisign added about $884 million to its share-repurchase authorization, bringing the available amount to $1.50 billion, and refinanced $550 million of notes with debt carrying a higher coupon and a 2031 maturity.