In the third quarter, revenues increased from $392 million to $400 million. Management did not provide earnings information because of its investigation of its prior option-granting practices. It expects to announce the results of the investigation within the fourth quarter.
VeriSign has two divisions. First, there is the Communications Services Group (CSG), which includes billing, messaging (such as SMS and instant messages), and mobile and broadband content distribution services. Because of consolidation in the telecom industry (which has meant tougher pricing), there has been slowing in the CSG division. Thus, in the third quarter, revenues for CSG were $203 million, which compares to $237 million in the same period a year ago.
There was a bright spot, however: VeriSign's mobile platform, Jamba!, will join forces with News Corp.
News Corp. plans to leverage its extensive content offerings -- such as The Simpsons, 24 and so on -- on the Jamba! platform. Of course, MySpace also has lots of potential, which could mean increased revenues from ringtones and music downloads.
VeriSign's other division is the Internet Services Group (ISG), which saw revenues increase from $161 million to $196 million. The division includes technologies for security, domain name registration, real-time publishing applications, and supply-chain systems.
For example, in the third quarter, the company processed about 6.1 million new registrations for .com and .net domain names, and there were 7.9 million renewals. In all, there are about 61.4 million active domain names.
Moreover, VeriSign sold about 136,000 Web site certificates, which allow for secure online transactions. The total is now about 781,000 (there was a big boost of 245,000 from the GeoTrust acquisition).
Basically, for this year, VeriSign has been focused on making key organizational changes. It has restructured its sales force, as well as focused on developing product road maps to integrate its various product lines (many of which came from acquisitions).
However, the firm has a myriad of strong catalysts for growth. First, there is a partnership with Symantec
VeriSign should also get a boost from Microsoft's new operating system, Vista, in the form of increased demand for Web site certificates.
No doubt, it has been a tough year for VeriSign shareholders. But with the company's critical Web infrastructure offerings -- as well as recent deals and restructuring -- 2006 could be about more than just incremental growth.
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