Verisign cuts 2024 forecast after Q1 underperformance

Declining .Com domain base impacts Verisign's outlook.

Verisign (NASDAQ:VRSN) recently released its quarterly earnings report and lowered its forecast for 2024.

The company ended the first quarter of 2024 with a total of 172.5 million .com and .net domain names, down 270,000 from the end of last year.

Com managed domains fell by 200,000, while .net remained essentially unchanged.

Q1 saw 9.5 million new .com and .net domains, down from 10.3 million in the same period in 2023.

Despite the drop in the number of domains, Verisign still realized a 5.5% increase in total revenue due to higher prices. In September of this year, it will once again increase the price of .com by 7%.

The price hikes have helped Verisign realize revenue growth despite a declining domain base, but it won't automatically increase prices in 2025 and 2026, which means it will need to increase domain registrations to realize revenue growth.

Initially, it estimated that the domain base would be between -1.0% and +1.0% this year; it now estimates a range of -1.75% to +0.25%.

It has lowered its revenue estimate to $1.555 billion-$1.570 billion from $1.56 billion-$1.58 billion.

It has narrowed its operating profit forecast range, but added a lower bound.