VeriSign Reports 6% Year-Over-Year Core Revenue Growth in Q3 2009

Active Domain Names, SSL Certificate Installed Base Increase in Q3

MOUNTAIN VIEW, CA -- November 5, 2009 -- VeriSign, Inc. (NASDAQ: VRSN), the trusted provider of Internet infrastructure services, today reported financial results for the third quarter ended September 30, 2009.

On a GAAP basis, VeriSign reported revenue of $258 million from continuing operations for the third quarter of 2009. On a GAAP basis, VeriSign reported net income attributable to VeriSign, Inc. and subsidiaries of $54 million and earnings per share attributable to VeriSign, Inc. and subsidiaries of $0.28 on a diluted basis. GAAP operating margin for the third quarter was 29.1%.

On a GAAP basis, VeriSign reported segment revenue for Internet Infrastructure and Identity Services ("3IS"), or the "core" businesses of Naming Services and Authentication Services, of $257 million for the third quarter of 2009, up 1% from the prior quarter and up 6% year-over-year.

On a non-GAAP basis (which excludes items described below) for its core businesses, VeriSign reported net income attributable to VeriSign, Inc. and subsidiaries of $64 million for the third quarter of 2009 and diluted earnings per share of $0.33. Non-GAAP operating margin for the third quarter was 38.6%. A table reconciling the GAAP to the non-GAAP results reported above is appended to this release.

"We had a good quarter and we're pleased with the strength of our core businesses both in terms of growth and operating leverage," said Mark McLaughlin, president and chief executive officer of VeriSign. "As we enter the last quarter of 2009, and with our divestitures essentially behind us, we are focused on growing VeriSign's core businesses."

"Our execution over the past two years has been strong, even as we implemented a significant refocusing of the business," said Brian Robins, chief financial officer of VeriSign. "We have continued to deliver solid revenue and earnings growth. We believe VeriSign today has the operational focus and financial flexibility we need to deliver for our customers and move the business forward."

Business and Corporate Highlights

-- VeriSign Naming Services ended the quarter with approximately 94.9
million active domain names in the domain name base for .com and .net,
representing a 6% increase year-over-year.
-- VeriSign Business Authentication Services ended the quarter with 1.20
million SSL certificates in the installed base, representing a 9% increase
year-over-year.
-- VeriSign's average daily query load increased to 54 billion in Q3 from
49 billion in Q2.
-- In October, VeriSign and RSA announced a technical and sales
partnership that includes the integration by the end of December 2009 of
the RSA SecurID Authentication Engine into the VeriSign Identity Protection
(VIP) Authentication Service.
-- Subsequent to the end of the quarter, VeriSign completed the sales of
the Global Security Consulting business, and Messaging and Mobile Media
Services. The proceeds from the sales of 13 of our former non-core
businesses from November 2007 to date, including the sale of the remaining
interest in the Jamba joint venture, are approximately $750 million.
-- VeriSign 2009 Analyst Day will be held on November 19 in New York
City. A live webcast of the event will be available at
http://investor.verisign.com.

Financial Highlights

-- Revenue from discontinued operations was $41 million while the non-
core Pre-Pay Billing business reported $1 million of revenue as part of
continuing operations during the third quarter of 2009.
-- Transition services revenue for businesses previously divested is
included in Other Income/Loss and was $1.2 million in the third quarter of
2009 compared to $1.1 million in the second quarter.
-- VeriSign ended the third quarter of 2009 with Cash, Cash Equivalents
and Restricted Cash of $1.4 billion, an increase of $124 million from the
prior quarter.
-- Cash flow from operations, on a consolidated basis, was approximately
$105 million for the third quarter of 2009 and $222 million year-to-date,
after giving effect to a reclassification of $101 million of year-to-date
excess tax benefits associated with stock-based compensation from operating
cash flows to financing cash flows.
-- Capital expenditures, on a consolidated basis, were approximately $25
million for the third quarter of 2009 and $66 million year-to-date.
-- Deferred revenue on September 30, 2009 totaled $881 million for
continuing operations, an increase of $3 million from the prior quarter.

Source: VeriSign