VRSN

Verisign is a legal monopoly that operates the .com and .net domain registries. It has a contract with ICANN that allows it to raise prices by 7% in 4 out of 6 years. The company has high operating margins (68%) and has been growing its revenue without increasing its headcount. The key KPI to track is the number of active domains.

VRSN short thesis. Growth is driven by high-churn registrars using ~50% rebates. Expects growth to slow in Q1 FY26E as renewals revert lower. Google banned ads on parked domains (~30% of .Com base), cutting parking revenue 85-90%, making renewals uneconomical. Domain base growth likely turns negative in FY26E.

VRSN (short): YTD .Com growth driven by high-churn registrars using ~50% rebates, with growth inflecting down in FY2026E as scaling laws hit. 6 registrars w/ ~14% lower renewal rates (~63% vs 73%) now 12.4% of domains. Google killed parked domain ads (~30% of domains), dropping revenues 85-90%, forcing non-renewal. 25-50% downside as narrative shifts back to melting ice cube.