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VeriSign (VRSN) D. James Bidzos on Q1 2016 Results - Earnings Call Transcript

Q1 2016 Earnings Call

April 28, 2016 4:30 pm ET

Executives

David Atchley, CFA - Vice President, Treasury & Investor Relations

D. James Bidzos - President, Chief Executive Officer & Executive Chairman

George E. Kilguss III - Senior Vice President & Chief Financial Officer

Todd B. Strubbe - Chief Operating Officer & Executive Vice President

Analysts

Steve M. Ashley - Robert W. Baird & Co., Inc. (Broker)

Gregg Moskowitz - Cowen & Co. LLC

Walter H. Pritchard - Citigroup Global Markets, Inc. (Broker)

Operator

Good day, everyone. Welcome to VeriSign's first quarter 2016 earnings call. Today's conference is being recorded, and unauthorized recording of this call is not permitted.

At this time, I would like to turn the conference over to Mr. David Atchley, Vice President of Investor Relations and Corporate Treasurer. Please go ahead, sir.

David Atchley, CFA - Vice President, Treasury & Investor Relations

Thank you, operator, and good afternoon, everyone. Welcome to VeriSign's first quarter 2016 earnings call. With me are Jim Bidzos, Executive Chairman, President and CEO; Todd Strubbe, Executive Vice President and COO; and George Kilguss, Executive Vice President and CFO.

This call and our presentation are being webcast from the Investor Relations section of our verisign.com website. There, you will also find our first quarter 2016 earnings release. At the end of this call, the presentation will be available on that site and within a few hours, the replay of the call will be posted.

Financial results in our earnings release are unaudited. And our remarks include forward-looking statements that are subject to the risks and uncertainties that we discuss in detail in our documents filed with the SEC, specifically, the most recent reports on Forms 10-K and 10-Q, which identify risk factors that could cause actual results to differ materially from those contained in the forward-looking statements. VeriSign retains its longstanding policy not to comment on financial performance or guidance during the quarter, unless it is done through a public disclosure.

The financial results in today's call and the matters we will be discussing today include GAAP and non-GAAP measures used by VeriSign. GAAP to non-GAAP reconciliation information is appended to our earnings release and slide presentation, as applicable, each of which can be found on the Investor Relations section of our website.

In a moment, Jim and George will provide some prepared remarks. And afterward, we will open up the call for your questions.

With that, I would like to turn the call over to Jim.

D. James Bidzos - President, Chief Executive Officer & Executive Chairman

Thanks, David, and good afternoon, everyone. I'm pleased to report a solid start to 2016 for VeriSign. First quarter results were in line with our objectives of offering security and stability to our customers, while generating profitable growth and providing long-term value to our shareholders.

We reported revenue of $282 million, up 9.1% year-over-year and we delivered strong financial performance, including $143 million in free cash flow. We processed nearly 10 million new registrations during the first quarter and added 2.65 million net new names ending with 142.5 million .com and .net domain names in a domain name base.

Our financial position is strong with $1.9 billion in cash, cash equivalents and marketable securities at the end of the quarter. As a part of managing our business, during the first quarter we continued our share repurchase program by repurchasing 1.8 million shares for $150 million.

We continually evaluate the overall cash and investing needs of the business and consider the best uses for our cash, including potential share repurchases. As we discussed during the last call, ICANN and VeriSign are in the final stages of preparing the Root Zone Maintainer Agreement and the .com Registry Agreement extension documents. We continue to make progress and we'll provide periodic updates as appropriate on our progress towards these objectives.