VeriSign, Inc.

Welcome to VeriSign's second quarter 2023 earnings call. Today's conference is being recorded. Recording of this call is not permitted unless pre-authorized. 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.

Thank you, Operator. Welcome to VeriSign's second quarter 2023 earnings call. Joining me are Jim Bidzos, Executive Chairman and CEO, Todd Strube, President and COO, and George Kilgus, Executive Vice President and CFO. This call and presentation are being webcast from the Investor Relations website, which is available under About VeriSign on VeriSign.com. There you will also find our 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 report on Form 10-K. VeriSign does not update 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 results and two non-GAAP measures used by VeriSign, adjusted EBITDA and free cash flow. GAAP to non-GAAP reconciliation information is appended to the slide presentation, which can be found on the investor relations section of our website, available after this call. Jim and George will provide some prepared remarks, and afterward, we will open the call for your questions. With that, I would like to turn the call over to Jim.

Thank you, David. Good afternoon to everyone, and thank you for joining us. We delivered another successful quarter by focusing on our mission as a critical infrastructure operator. The quarter included the renewal of the .NET registry agreement and solid financial results. Additionally, last week, we marked 26 years of 100% availability in the .com.net domain name resolution system. Throughout the various global challenges over the past 26 years, from the pandemic to natural disasters to evolving cyber threats, Our purpose-built network has kept billions of people worldwide continuously connected to what matters most. The work we do to operate, protect, and evolve key Internet infrastructure has never been more important than it is today. Reaching this mark is a testament to the ongoing investments made in our platforms, processes, and people. On June 30th, we announced the renewal of the .NET registry agreement with ICANN, as expected given the presumptive right of renewal in our agreement. The business terms of the agreement, such as pricing, the fees paid to ICANN, our renewal rights, and the six-year term of the agreement are unchanged. The next renewal for the .NET registry agreement will be June of 2029. In addition to delivering on our mission during the second quarter, I'm pleased with the financial results, which show the continued strength of our business during this uncertain macroeconomic period. For the second quarter, revenues grew 5.7% year-over-year, while EPS grew 16.2% year-over-year. At the end of June, the domain name base in .com and .net totaled 174.4 million domain names, up from 174.3 million in Q2 2022, and up from 173.8 million names at the end of 2022. During the second quarter, the domain name base decreased by 0.3 million domain names, offsetting some of the 1 million names we added during the first quarter. From a new registration perspective, the second quarter delivered a 1.5% year-over-year increase with 10.2 million new registrations compared to 10.1 million last year. We believe that the renewal rate for the second quarter of 2023 will be approximately 73.4% compared to 73.8% a year ago. While there are many factors that drive demand for domain names, the core value proposition for domain names remains strong, and we're seeing broad-based engagement from our registrar channel. However, with these fundamentals intact, low demand from China remains the primary source of drag on the overall domain name-based growth. With this current trend, we now expect a domain name-based growth rate of between 0% and 1% for the full year of 2023. This updated range reflects continued uncertainty, especially the weakness we continue to see related to China. Our financial and liquidity position remains stable with $936 million in cash, cash equivalents, and marketable securities at the end of the quarter. During the third quarter, we repurchased 1 million shares for 220 million. Effective today, the Board of Directors has increased the amount authorized for share repurchase of VeriSign common stock by $1.14 billion to a total of $1.5 billion authorized and available under the share repurchase program, which has no expiration. On .web, as many of you have seen from our statement on May 3rd, ICANN's Board of Directors dismissed affiliates' objections regarding the .web auction and directed that NDC's .web application move forward. This was a significant finding by the board and we're pleased that our role in the auction was proved to be consistent with ICANN's policies. Subsequently, according to ICANN's website, affiliates has filed another IRP complaint, presumably challenging the board's decision. This filing has not been posted nor has any response from ICANN. ICANN has placed NDC's .web application Sorry, on hold now. Given the board's decision, we see no basis for any further delay in delegating .web, but this is an ICANN process and we're not yet involved in it. Finally, as announced in today's earnings release, we have given notice of a price increase of 99 cents to the annual wholesale price for .net domain names, which will raise the price from $9.92 to $10.91, effective February 1st, 2024. And now I'd like to turn the call over to George. I'll return when George has completed his financial report with closing remarks. George?