The operator introduces the participants at Verisign's Third Quarter 2023 Earnings Call and explains the rules for recording the conference. David Atchley, Vice President of Investor Relations and Corporate Treasurer, then introduces the CEO and other executives. He also mentions that the call is being webcast and that the presentation and replay will be available on the Investor Relations website. He also discusses the unaudited financial results and the forward-looking statements. The CEO and CFO will provide some prepared remarks before opening the call for questions.

The company had a strong third quarter with a 5.4% increase in revenues and a 15.8% increase in EPS. The domain name base slightly increased to 173.9 million, with 9.9 million new registrations. The renewal rate is expected to be 73.4%, and the company is seeing strong engagement from registrar channels. However, low demand from China is impacting overall growth. The company has a stable financial position with $943 million in cash and repurchased 1.1 million shares for $220 million during the quarter. $1.34 billion remains available for share repurchases.

In this paragraph, the speaker discusses their actions regarding the .web domain and provides an update on the situation. They urge readers to read Altanovo's IRP complaint and ICANN's response on their website. They clarify that NDC is a company that is Verisign's partner in the .web application. The speaker agrees with ICANN's conclusion that NDC did not violate any rules and believes that the IRP filed by Altanovo was for the purpose of delay. They also mention their intention to bring .web to market and provide more options for registrations. The speaker then hands the call over to George for a financial report.

Verisign reported their financial results for the third quarter of 2023, showing a decrease in operating expenses compared to the previous quarter and an increase in net income. Operating and free cash flow also increased for the nine-month period. The company updated their full year 2023 guidance, with revenue expected to be between $1.490 billion to $1.495 billion and operating income between $995 million and $1 billion. Verisign's CEO, Jim Bidzos, expressed confidence in the company's strategic focus and disciplined management, which has allowed them to provide secure and reliable infrastructure services, manage their business responsibly and efficiently, and return value to shareholders.

The company's business fundamentals remain strong despite ongoing turbulence in the economy and low demand from China. The company has seen steady growth in revenue, operating income, and EPS. The decline in demand from China is due to challenging economic conditions, regulatory changes, and currency fluctuations. However, this decline has been offset by gains in other regions. In the most recent quarter, revenue from China-based registrars was $22 million, a $5 million decrease from the previous year.

The remaining $354 million in revenue from registrars outside of China increased by $24 million, showing growth in both top line and operating income. The timing of when things will normalize for China-based registrars is uncertain, but the chances of change being helpful are high. The recent ICANN post on .web clarifies their response and the next step is for a panel to be formed and for the public to see the IRP complaint from Altanovo and ICANN's answer.

The speaker urges listeners to read up on current issues before the proceedings begin. A question is asked about the pace of domain growth, specifically outside of China. The speaker notes that there are macroeconomic and geopolitical factors impacting the business, but there is growth in new registrations and the domain name base. The speaker points to the geographic revenue disclosure as a good indication of this growth and mentions that the value proposition of the domain name remains strong.

The decline in China's domain name growth is offset by better performance in other regions. The company has been able to control expenses and come in ahead of expectations. They will provide full year guidance on expenses next earnings call. Expenses are expected to be lower this year, but similar to last year when normalized for the fees paid to .tv. The company will continue to make necessary investments to execute their mission and meet SLAs, but will also make efficiencies where possible. Investment in infrastructure is a top priority for the company.

The company is managing responsibly and will provide full guidance for 2024 in the next round of earnings. The speaker, Jim, responds to a question about the current macroeconomic climate and mentions ongoing turbulence and geopolitical issues that may impact the company. He notes challenges in the Chinese market and observes events but does not have any significant insights to share at this point.

The negative impact of economic downturns can lead to caution and rising interest rates, putting pressure on businesses. However, the company focuses on what they can control by delivering services and practicing responsible expense control. They believe their business model allows them to weather tough economic climates. The conference call has now ended.

This summary was generated with AI and may contain some inaccuracies.