VeriSign Earnings: Shares Sell Off Following Report

S&P 500 (NYSE:SPY) component VeriSign Inc. (NASDAQ:VRSN) reported net income above Wall Street’s expectations for the third quarter. VeriSign provides Internet infrastructure services for the networked world.

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VeriSign Inc. Earnings Cheat Sheet

Results: Net income for VeriSign Inc. rose to $77.9 million (47 cents per share) vs. $58.9 million (36 cents per share) in the same quarter a year earlier. This marks a rise of 32.2% from the year-earlier quarter.

Revenue: Rose 13.5% to $223.5 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: VeriSign Inc. reported adjusted net income of 50 cents per share. By that measure, the company beat the mean estimate of 44 cents per share. It beat the average revenue estimate of $216 million.

Quoting Management: “We continue to see benefits in our results from our restructuring, focus, and continued operational discipline,” commented Jim Bidzos, executive chairman, president and chief executive officer, “We remain committed to providing unparalleled network and registry services performance as we work with the Commerce Department to renew the .com Registry Agreement. Additionally, an area of emphasis for us is further enhancing our infrastructure to strengthen security and stability for both our customers and our own operations, in the face of new and ever-increasing cyber threats,” said Bidzos.

Key Stats:

For the past five quarters, the company has seen double-digit year-over-year percentage revenue growth. Over that span, the company has averaged growth of 13.8%, with the biggest boost coming in the fourth quarter of the last fiscal year when revenue rose 15.2% from the year earlier quarter.

The company has now topped analyst estimates for the last three quarters. It beat the mark by one cent in the second quarter and by 2 cents in the first quarter.

Looking Forward: For the next quarter, analysts are growing pessimistic about the company’s expected results. The average estimate for the fourth quarter is 48 cents per share, dropping from 49 cents a month ago. For the fiscal year, the average estimate has moved down from $1.73 a share to $1.72 over the last seven days.

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(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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