CentralNic expects to blow past revenue estimates

CentralNic has updated its financial projections for the year, saying it expects to “materially exceed” the current analysts’ estimates.

The London-listed company expects to next month report revenue for the nine months to September 30 up 86% at $525 million and adjusted EBITDA of “at least” $61 million, up 89% compared to last year.

That’s just for three quarters. The latest analyst consensus estimate was for revenue of $626.6 million and EBITDA of $72.5 million for the entire year, the company said.

Twelve-month organic growth, excluding the effect of acquisitions, to September 30 is estimated at 66%.

CentralNic said growth is being “driven predominantly by the growth of the Online Marketing Segment, which continues to win market share as a result of the ever-increasing demand for online customer acquisition services that are privacy-safe.”

ICANN finished year $24 million ahead but loses $29 million on the markets

ICANN came out of fiscal 2022 $24 million ahead of its budget due to lower travel expenses and greater domain sales than expected, but blew $29 million on poor investments, according to financial results published today.

The Org ended June having received $150 million, mostly from registries and registrars, which was $5 million more than it had budgeted for.

Fixed, variable and transaction-based fees accounted for most of the difference. Registrars sold more domains than ICANN predicted, and fewer registries and registrars cancelled their contracts.

Verisign of course was the biggest contributor, accounting for over a third of revenue — $49 million for .com/.net fees alone. On the registrar side, GoDaddy contributed over $11.2 million.

GoDaddy’s contribution is actually a little higher than all the 131 participating ccTLDs’ voluntary donations combined, which came in at $11 million.

Expenses were $125 million, against a budget of $143 million. That was mostly due to the fact that two of its three meetings were held entirely online, so ICANN didn’t have to pay its staff and volunteers’ travel expenses.

It spent $3 million on meetings in the year, against a $10 million budget.

When the budget was passed in May 2021, ICANN had expected all three meetings to take place in person, with international travel “unrestricted” despite the pandemic.

Expenses were also affected by a lower-than-expected headcount. Average headcount was down by three on FY21 at 389, compared to the 405 predicted by the budget.

Despite the over-performance at the operating level, ICANN’s balance sheet actually declined compared to a year earlier.

It had funds under management of $505.5 million compared to $520 million, having lost $29 million due to “investment declines in the Reserve Fund due to volatility in the financial markets”. Its portfolio is still $9 million ahead compared to five years ago, however.

CentralNic revenue almost doubles

CentralNic has reported its first-half financial results, showing revenue up 93% to $334.6 million when compared to the same period last year.

Given the company’s acquisitive nature, some of the growth of course came from companies it has recently bought, but CentralNic said trailing 12-month organic revenue growth was a health 62%.

Adjusted EBITDA for the period was $38.6 million, up 97% on the first half of 2021.

Domain names, what the company calls its Online Presence segment, now account for a minority of CentralNic’s revenue, $76.8 million in the half, down a bit on last year due to currency exchange rates.

The company said it has been shaking up its strategy by reducing the amount of discounted domains it sells. Average revenue-per-domain went up from $8.90 to $9.60, but volumes were down from 6.5 million to 6 million as a result.

The Online Marketing segment grew 167% to $257.8 million. Organic revenue growth was 98%, “predominantly driven by CentralNic’s TONIC media buying business”.

Visitor sessions was up from 1.1 billion to 2 billion and RPM was up 87% from $106.

NameSilo reports revenue up 33%

Canadian registrar NameSilo this week reported its second-quarter financial results, showing revenue up 33.7% compared to the year-ago period.

The company said it now has 4.61 million domains under management and had revenue of $11.2 million for the quarter. It reported a net loss of $683,000.

Bookings, the best indicator of future revenue, were up 22% to $12 million. The company had $25.3 million of deferred revenue on its balance sheet at the end of the quarter.

NameSilo said “an increase in domains under management, marketplace revenues, and from the sale of ancillary services” all contributed to the growth.

Tucows’ domains business stagnates again in Q2

Tucows’ domain name business has experienced its third consecutive quarter of stagnating growth.

The company yesterday reported third-quarter total domains revenue of $61 million, compared to $62.3 million a year ago and $61.5 million in the second quarter.

Dave Woroch, CEO of Tucows Domains, described this 2% annual decline as “consistency” on a prerecorded address to analysts.

He pointed to Verisign’s recent comments about a decrease in .com registration volumes as evidence of an industry-wide post-pandemic slowdown, but was somewhat bullish on some new gTLDs.

“At the other end of the industry, we do see more robust growth in many of the new gTLDs that are of higher quality and that have little to no speculation or cyber crime opportunity,” he said.

The domains industry is “generally not showing a lot of growth”, he said, adding that “outsized growth would need to come from new areas”, which could include so-called “web3” efforts.

Woroch noted the recent funding of blockchain alt-root project Unstoppable Domains, but said Tucows is not a fan. Unstoppable has, like similar efforts dating back over 20 years, some “fatal flaws” and “a chicken and egg problem” of adoption, he said.

Domains under management at Tucows decreased to 24.8 million from 25 million sequentially and 25.6 million a year ago.

Tucows’ retail domains revenue was down to $8.5 million from $8.9 million a year ago, while the wholesale business, including value-added services, was down to $52.3 million from $53.4 million.

Including non-domains businesses, Tucows’ Q2 revenue was up 11% to $83.1 million and the net loss was $3.1 million compared with net income of $1.8 million a year ago.

Verisign announces ANOTHER price increase as regs slide

Verisign posted a rare decrease in its .com/.net registered name base in the second quarter, but said it is going to raise its .net prices next year anyway.

The company also massively slashed its growth outlook for domain sales this year.

The annual cost of a .net name will go up 10%, the maximum permissible under its contract with ICANN, to $9.92 from February 1 next year, the registry said

Registrants will as usual be able to lock-in the current renewal fee of $9.02 for up to 10 years if they renew before the hike kicks in.

It’s the first .net price increase since 2018. The TLD has been stagnating in volume terms for several years, due no doubt in part to behavioral changes following the introduction of new gTLDs starting in late 2013.

The news came as Verisign reported that its domain base shrunk during Q2.

The company ended June with 174.3 million names under management, up 2.2% over a year earlier but down 350,000 domains compared to the end of Q1.

The split was 161.1 million for .com and 13.2 million for .net — that’s a sequential decrease of 200,000 for .com and a decrease of 200,000 for .net. Both rounded, of course.

CEO Jim Bidzos told analysts tonight that renewals were affected by a great many first-time registrations from China not renewing. General post-pandemic and macro-economic factors also played a role, he said.

The preliminary renewal rate was 75.9% compared to 76.0% a year earlier, but the number of new regs was down to 10.1 million from 11.7 million over the same period.

Verisign reported Q2 revenue up 6.8% on a year ago at $352 million, with net income of $167 million compared to $148 million. Its operating margin swelled to 67.1% percent from 64.7%.

Bidzos told analysts that the company is cutting its registered name growth prediction for the year to between 0.5% and 1.5%, a huge decrease from the already-downgraded estimate of 1.75% and 3.5% it made after the first quarter.

He said that he expects Q3 and Q4 to go much the same way as Q2.

Bidzos said he thinks the current factors affecting regs are a bump in the road and he expects things to stabilize over time.

UPDATE 2148 UTC — The article was updated to correct the comparison of the decrease in .com/.net regs.

CentralNic revenue almost doubles

CentralNic has reported its preliminary first-half financial report, showing a top line that almost doubled compared to last year.

The company, which nowadays makes most of its growth from domain monetization, saw revenue up 92% to $335 million, driven by acquisitions. Organic revenue growth was up 62%.

Adjusted EBITDA was up 85% at $38 million, CentralNic said.

The company credited its online marketing segment, which it has built through acquisitions over the last couple of years, for the bulk of the growth.

Speaking of acquisitions, CentralNic also said today that it’s on the hook for $1,138,400 due to the acquisition of KeyDrive — holding company for the likes of registrar Moniker and registry KSRegistry — which was carried out in 2018.

That’s at the low-end of the up to $10.5 million in performance-related acquisition payout announced at the time.

NameSilo profitable in Q1

Canadian registrar NameSilo today reported that it took a profit in the first quarter, reversing the loss of a year ago.

The company reported a net income of CAD 330,613, compared to a loss of CAD 3.8 million in Q1 2021, on revenue that was up 34.7% at CAD 10.8 million.

The registrar said its names under management had increased to 4.63 million by the end of March.

NameSilo now believes it is the 11th largest registrar.

Domain sales down even as revenue booms at CentralNic

CentralNic has posted stunning growth for the first quarter, even as it sold fewer domain names.

The company said this morning that revenue increased by 86% to $156.6 million in the three months to March 31, helped along by a few acquisitions in the monetization segment. Organic growth for the 12 months was roughly 53%.

Profit was $4 million versus a $1.4 million loss. Adjusted EBITDA was up 83% to $18.5 million, the company said.

CentralNic said it processed 3.1 million domain registrations in the quarter, down from 3.4 million a year earlier, but said this was because it moved away from selling domains cheaply in bulk.

This meant average annual revenue per domain was up 11% to $9.50, it said.

The online presence segment, which includes domains, was up 2% to $39.7 million.

But the online marketing segment, which includes domain monetization, was up 158% to $116.9 million, again helped by acquisitions.

CentralNic also disclosed that the price it agreed to pay for the .ruhr gTLD, a German geographic, back in January was €300,000, split into two payments of €150,000.

Tucows to reanimate Tucows brand as sales flatten

Tucows has become the latest domain name company to confirm it’s experiencing the post-pandemic blues, and said that it plans to revitalize the Tucows brand.

Reporting basically flat-to-down domain numbers on Thursday night, the company said that it plans to “more closely connect the Tucows parent and the registrar brands” in the coming months.

“For more than two decades, Tucows has been synonymous with domain registration. In the coming months, you will see a stronger connection of the Tucows brand with our registrar properties, with each anchored by the rich heritage of the Tucows name,” Dave Woroch, CEO of Tucows Domains, said in prepared remarks.

It’s not clear what this will entail in practice. The company’s main brands are Hover in retail and OpenSRS and Enom in wholesale, and you’d be hard pressed to find a mention of Tucows on any of their storefronts.

First-quarter domain revenue was “essentially unchanged” from the same period a year ago, at $61.5 million compared to $61.2 million.

Retail domains revenue was down to $9.1 million from $9.2 million. While wholesale revenue was $52.5 million versus $52 million, the increase was driven by value-added services rather than domain revenue, which was basically flat.

The renewal rate was a healthy 81%.

Woroch said that domain transactions “are now settling back in at pre-pandemic levels” after the lockdown bumps experienced over the last two years. He pointed to Verisign’s recent comments to suggest these are industry trends.

Including Tucows non-domains businesses, revenue was up 14% to $81.1 million and there was an overall net loss of $3.0 million compared to a profit of $2.1 million.