VeriSign, Inc. (VRSN) Q2 2026 Earnings Report, Transcript and Summary

Good day, everyone. Welcome to the VeriSign's Second Quarter 2026 Earnings Call. Today's conference is being recorded. Recording of this call is not permitted unless preauthorized. At this time, I'd 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 2026 Earnings Call. Joining me are Jim Bidzos, Executive Chairman, President and CEO; and John Calys, 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 reports on Form 10-K and 10-Q. VeriSign does not plan to update financial performance or guidance during the quarter. The financial results in today's call and the matters we will be discussing today include GAAP results and free cash flow, a non-GAAP measure used by VeriSign. 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 John 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.

Thanks, David. Good afternoon to everyone, and thank you for joining us. Last week, we marked 29 years of delivering 100% availability for the .com and .net domain name resolution system, an unprecedented achievement that speaks to the robustness of the high assurance critical infrastructure we operate. Alongside that technical milestone, we're also pleased to report that VeriSign delivered strong results in the second quarter of 2026, both operationally and financially. The combined .com and .net domain name base is now at 179.1 million names, driven by a record 12.7 million new registrations during the second quarter with continued solid renewal rates. On the financial side, revenue was up 6% year-over-year, and EPS increased 7.7% year-over-year. We have returned more than 100% of our free cash flow to our shareholders in the last 12 months, totaling $1.17 billion in share repurchases and dividends. Effective today, the Board of Directors has increased the amount authorized for share repurchases of VeriSign common stock by $884 million for a total of $1.5 billion available under the current share repurchase program, which has no expiration. As announced in today's earnings release, VeriSign's Board of Directors approved a cash dividend of $0.81 per share of VeriSign's outstanding common stock to shareholders of record as of the close of business on August 19, 2026, payable on August 27, 2026. VeriSign intends to continue to pay a cash dividend on a quarterly basis. VeriSign's performance in the second quarter shows continued robust demand for domain names. During the quarter, the domain name base for .com and .net grew 3.05 million from the prior quarter end. New registrations for the second quarter were a record 12.7 million compared to 11.5 million last quarter and 10.4 million for the second quarter of last year. The renewal rate for the second quarter of 2026 is expected to be 75.2%, compared to 75.5% a year ago. The U.S. and EMEA were the regions in which we saw the strongest growth during the second quarter. The factors driving the solid domain name base trends the past several quarters accelerated during the second quarter. Registrars are focused on customer acquisition and are successfully engaged with our marketing programs. Additionally, AI tools are making content and website creation faster and easier. The strength in new registrations attest to the vital role of domain names in being discovered and establishing digital credibility. With the trends we've observed in the first half of 2026 and our expectations for second half, we're increasing and narrowing our guidance for domain name base growth to be between 5.2% and 6% for 2026. As a reminder, you can monitor the progression of the domain name base on our website, which is updated daily. The first quarter renewal rate is the highest rate we have seen in 20 years. The 12.7 million new registrations are the largest we have seen for any quarter in our history. The record metrics we have seen during the first half of 2026 and the solid outlook made for our upward revision for domain name base growth for 2026. We're very pleased with the strong business metrics, which are leading to strong financial metrics for the company. Before having John review the financial metrics, I want to spend a minute talking about .web. Last night, we announced that .web had been delegated into the global Domain Name System's root zone, with VeriSign as the registry operator. The delegation of .web follows the successful resolution of all previous disputes related to the generic top-level domain. With a worldwide channel of registrar partners and decades of experience leveraging channel relationships to market and distribute TLDs like .com and .net, VeriSign is poised to offer .web as an attractive new domain for TLD registrants across the globe. VeriSign plans to begin offering .web domains through its channel partners later this year, and we'll share further details about the planned launch in the coming months. As the launch is expected late this year, at this time, we don't expect meaningful revenue or expenses related to .web for 2026. We understand there may be questions about the new products we discussed in our last earnings call. We didn't put our new product efforts on hold. There are and have been teams working without interruption on them, and they've been operating -- the products have been operational in test mode since early this year. We simply paused the rollout of the blogs as we focused on resolving and delegating .web. And with that complete, we can turn our attention back to introducing those products, and you'll see the blogs in the coming months. I can say that the products are very security focused, that they benefit from our high assurance, high-performance infrastructure and that they also benefit from our long history in public key infrastructure and DNS security. They're designed to provide a high level of performance and reliability at global scale as our DNS resolution does. We believe today's increasing reliance on online services, especially those that are AI-related, with the evolving threat environment will demand greater and deeper deployment of security technology and practices, which will come with performance, security and scalability challenges. Our infrastructure will address those challenges and more. Now I'd like to turn the call over to John. I'll return when John has completed his financial report with closing remarks. John?

Thank you, Jim, and good afternoon, everyone. For the quarter ended June 30, 2026, the company generated revenue of $435 million, up 6% from the same quarter a year ago. Operating expense in Q2 2026 totaled $138 million, which compared to $135 million last quarter and $121 million for the second quarter a year ago. Operating income totaled $296 million, up $16 million or 5.6% from the previous year. Operating income was up $3 million or 0.9% sequentially. Net income for the second quarter totaled $217 million, compared to $215 million last quarter and $207 million for the same quarter a year ago. This resulted in diluted earnings per share of $2.38 for the second quarter this year compared to $2.34 last quarter and $2.21 for the second quarter last year. Operating cash flow for the second quarter of 2026 was $232 million, and free cash flow was $213 million, compared with $202 million and $109 million, respectively, in the year ago quarter. Our financial and liquidity position remained stable with $1.034 billion in cash, cash equivalents and marketable securities at the end of the quarter. That amount included $546 million of net proceeds from the issuance of 5.1% Senior Notes maturing in 2031. On July 20, 2026, the company redeemed its $550 million of outstanding 4.75% Senior Notes due in 2027, thereby reducing our liquidity from quarter end. I will now discuss our updated full year 2026 guidance, which, as Jim mentioned earlier, does not anticipate meaningful revenue or expense related to .web at this time. Revenue is now expected to be between $1.745 billion and $1.755 billion. Operating income is now expected to be between $1.185 billion and $1.195 billion. Interest expense and non-operating net, is narrowed and expected to be an expense between $59 million and $65 million, reflecting the impacts related to the refinancing I mentioned earlier. Capital expenditures are still expected to be between $55 million and $65 million. The GAAP effective tax rate is still expected to be between 22% and 25%. I will now turn the call back to Jim for his closing remarks.

Thanks, John. While we're very pleased that .web is now delegated, we'd like to focus on the very solid trends we're seeing in our business in 2026. We extended our record of 100% service availability to 29 years. We saw strength in all metrics, in particular, with new registrations and solid financial performance. We returned more than 100% of our free cash flow to the investing public. We've seen strong execution of our marketing programs, which are better suited to our evolving channel. These programs are a great investment as they contribute significantly to our long-term growth and profitability. Importantly, the first-time renewal rate has stayed in a tight range in the mid-40% range for several quarters. Names registered in the first half of last year are renewing at rates consistent with our longer-term first-time renewal rate. Our programs are carefully designed to produce these results. Now as we look at the significant increase in new registrations, for example, up 14% year-over-year in the first quarter and up 21% year-over-year in the second quarter, we're encouraged that the factors that are driving the new registration strength, including our programs, have been producing quality names. This should translate to long-term profitable growth for this company. And as a reminder, once a name renews at least once, it becomes part of our previously renewed base. The previously renewed rate is in the mid-80% range. Additionally, we're benefiting from some factors that include AI. AI has made finding a good domain name, building a website and getting online faster and easier. This includes leveraging AI-enabled tools we've made available to our registrar partners. Our record high domain name base and record high new registrations are contributing to the ever-increasing reliance on VeriSign's high assurance critical Internet infrastructure. We've seen a substantial increase in the number of DNS transactions to our servers. Operating a high assurance infrastructure remains our priority and is at the core of VeriSign. We also believe that our uptime record is a significant contributor to the growth of our domains, and that reliability will allow individuals and businesses to register .web domain names with confidence. Thanks for your attention today. This concludes our prepared remarks, and now we'll open the call for your questions. Operator, we're ready for the first question.

Our first question comes from Rob Oliver with Baird.

Great. I had a couple of questions. Jim, I'll just start with you. I appreciate some of the color you provided around the really strong domain trends. And I was wondering if you could just add a bit more. I know some of what's at work here is you guys have really sharpened your marketing programs and your efforts, and I think that's really showing in not just the registrations, but also in those first-time renewal rates in terms of the quality. You're also seeing these tailwinds around AI, around application development, the importance of the domain. And I was wondering if you could help contextualize, kind of, maybe breaking those apart, help us better understand of the strength you're seeing, how each is responsible for them? And then I had a couple of other questions.

Okay. Well, let me see if I can answer that briefly here. First of all, the components I can easily describe, I think one of them I mentioned earlier was our high assurance infrastructure, I think that contributes to people's confidence in online operations. AI is definitely enhancing demand for domain names. AI tools make it easier for content creators, for businesses to find domain names, create content, create, maintain content on their websites and businesses and content creators compete not only for attention online through AI-driven search, but the credibility and digital identity that a domain name encapsulates become even more critical. So those are all contributing trends and tailwinds. Active registrar engagement with and strong execution of our marketing programs is definitely helping. I think -- last quarter, I called that if I didn't use the word convergence, I should have. I'll use it now. A synergistic convergence of some of the AI tailwinds and other tailwinds like the ongoing registrar focused now on customer acquisition, where we saw this sort of cyclical trend some time ago to ARPU. Now we're seeing things shift as we predicted they would. So there's a bit of good fortune here, but I think our marketing programs and their design are clearly a contributor, sort of taking those apart with any precision is really difficult. I'm not sure we could even give you that kind of detail. We just see them working synergistically. I think we've also gotten much better at these marketing programs. I often talk about the evolving changing channel. Their business models are changing, and we've been able to adapt to that. Just like mentioned, with .web, we can adapt even further because we have fewer restrictions on that TLD. So all those factors together are contributing to the strength that you're seeing, it's primarily, as I mentioned, in the U.S. and EMEA. That's a positive for us because the quality and the renewal rates from these regions tend to be stronger. So like I said, taking it all apart, parsing it out in detail, difficult, but I think we're seeing the growth. We recognize the tailwinds. We definitely know, we're very close to the channel. We understand the value and benefit and effectiveness of the marketing programs. And again, I'll say again that when you see 14% and 21% increase in units, respectively, in the last 2 quarters, and you see first-time renewal rates essentially within a narrow range with long-term strong renewal rates, that's going to yield profitable growth long term. So these are all very good for the business. And one point to clarify here. We received questions about the current strength. Is it related to pull forward related to the November .com wholesale price increase. I can't say that that's not a factor. It could be a factor for some registrations. We just don't see it as anything coming close to a material factor in the current registration strength. So hopefully, that's helpful.

Okay. Great. Yes. No, that is helpful. And on that last point. That was a question I was going to ask as well. I wanted to ask about .web also and congrats. I'm happy. I thought I'd be in my dotage by the time that deal finally closed. So congratulations on that. I guess, I know you -- knowing you guys, you're not going to talk about pricing and things like that. But maybe try to ask the question in a different way. You guys have obviously the premier anchor asset in .com. You do have experience with other assets like .net. But conceptually, how should we think about the way in which you'll think about approaching .web, marketing .web? And how, if at all, will it be different from .com? And then I'll pass it on. I know we've got more people on the call.

Okay. Thanks. Well, .web is different from .com. .com is uniquely the only TLD in the entire DNS industry that's regulated by a cooperative agreement between VeriSign and the Department of Commerce, the NTIA. .web is a TLD like the other 1,000 -- 2,000, almost TLDs that ICANN oversees and regulates. And its operating parameters are actually quite different. We don't have many of the restrictions. So for example, like all these other TLDs, it's governed by a standard registry agreement. They are all operating from the same registry agreement, which is only with ICANN, as I mentioned, not with any other regulatory body. Obviously, there are other global regulations that affect all tech companies, but the administration and regulation of the domain name industry is by ICANN, and this agreement is no different than the others. I'd say the most obvious difference with .web from .com and .net is that we have complete wholesale pricing flexibility that the only requirement is a 6-month notice. Other than that, we can price -- we have a complete pricing flexibility. But like .com, one thing that is in common with .com is that we are a wholesaler as a registry, and it will be registrars, of course, who set the retail pricing. So .web wholesale pricing is completely within our control, subject to that notice period to the registrars of 6 months. This includes the ability to sell premium names as well, which we cannot do in .com or .net. And now that it's delegated in the root zone, the process, just to give you a sense of what to expect coming up, there is a 90-day required period of security testing. So that's the first thing we'll do. We're beginning that. Then there is a required minimum 30-day period in which only trademark holders may come and get their .web registration. So we'll certainly observe that. So that puts us 120 days out. Then we have something optional called an LRP or a Limited Registration Period. This is where registries have the opportunity to set their own rules for who can come in before you go to general availability. And we intend to offer -- we intend to run an LRP, and the rules that we will use is we will give all of our holders of .com registrations, the opportunity to come and get the same registration in .web before we open registrations for general availability. We're working out the details of how long that will run, but we do intend to do that. So that puts general availability, we think it will be either late this year or very, very early next year. And that's pretty much everything about .web I can share right now. We'll obviously provide you further updates, but we're excited. I noticed that it's been quite a while since we've been in pursuit of .web, but it is a very different TLD, and I appreciate your question. Those are the ways that it's significantly different. And there's also flexibility in how we market to the channel. We do not have the same restrictions that we have now. We can be more flexible, more creative, more engaging individually with the channel. I think that's going to translate into an opportunity to even more effectively engage this diverse and evolving channel. So all in all, the prospects are promising. It's exciting. It's something new and different for us. We've been looking forward to it.

And we'll go next to Ygal Arounian with Wedbush.

Maybe first, just with the guidance, the high end domain growth approaching 5%. And as I sort of look back to -- it's been quite a while since domains have grown 5% sustainably. I know we are now, but looking back to 2025 and the years before, but it's been a long time since we've been at that level. I know we're talking about some of the factors, particularly AI. Does it feel like we're structurally at a different type of growth rate driven by AI? And then within that, and you're talking about some of the AI factors that are driving the growth. How are you seeing agentic play out here? And is that -- do you think that's driving any incremental growth on the agentic AI piece specifically? And I'll have one follow-up.

Okay. Well, first of all, Ygal, welcome back. It's good to have you back following VeriSign again. We appreciate that. Good. Well, let me try to answer this from a higher altitude, so to speak. I'm not sure I can specifically answer some of the things you seem to be asking towards the end there. But let's start with why are domain -- why is there a general increase and what's AI doing to it? I think AI is definitely increasing demand for the obvious reason we mentioned, which is that it's easier and faster to build a domain name. But I think that sort of only saying that, I think, tells the only part of the story. The other part of the story is that AI is driving, obviously, more engagement. More is happening more quickly. And I think what's happening is that the strength of the DNS is sort of shining through here. We've often said that alternate name spaces don't really have what the DNS has, which is this governance by ICANN that creates what is a secure, stable global identifier. It's secure because of all the security required by ICANN and then we do above and beyond as many other registries do as well. It's stable, certainly in our operations because we just completed a record 29 years of uninterrupted availability. And it's global because ICANN operates in 150-plus countries. And so these domain names are guaranteed to be unique and stable and secure up to a very high level due to this governance structure. I think that's underappreciated as a contributor to the rapid willingness and eagerness to adopt e-commerce and to get online. Here they are. They work. Now the DNS under the covers is very complex, and I think AI is obscuring some of the complexity and making it easier for people to get online. I would say that might be the single biggest influence, if you wanted to look for external influences. As I said, we are making our own contribution. We've gotten smarter and more engaged with our channel. We understand what they're doing. They do have complex business models. They have evolved. Many have gone public. Some public ones have gone private. Some sell wholesale, some only sell retail. It's very diverse, and it keeps evolving. So if it feels like the world is spinning faster, well, it does to me. And I think we're seeing those effects. And those effects and that stability and our willingness and ability to adapt to them, I think, is behind our growth. I can't speak for everything, but that's my sense of the best answer I can give to your question, if that's helpful.

Okay. Great. Very helpful. And then yes, good to see .web finally come through, and we can change how we write about it. The color you gave on the timing is really helpful. Just wondering, as we think about kind of how we build this into our models, are there upfront costs? You mentioned the marketing a little bit. Are there cost to build the registry or anything else that come ahead of revenue recognition? I just want to think through how that impacts your financials.

Well, I think as we finalize our launch plans and marketing plans, there'll be some marketing expenses as there is now with .com and .net. But in terms of any registry costs, no, we run multiple TLDs now. We have a number of TLDs that we operate. We've operated many over the years, not just .com and .net. So this is as natural as integration -- an integration as one could imagine. There's simply nothing new about the integration of .web and processing registrations, the manner in which the registrars engage and bring their registrations to our operations is identical to everything we're doing now. It's another TLD. There's just more flexibility in engagement and marketing with the channel, which is really a big plus for us. John, any comments?

Yes. I'd say from a marketing expense standpoint, given where we're at in the time frame that Jim laid out in his comments, there won't be a significant amount of marketing expense this year that we recognize. And the same is true for revenue. It's likely to be fairly late in the year. And because of our method of revenue recognition, you won't see a big bump even if you see some nice sales before the end of the year, you won't see revenue recognition happen right away. It will take some time to build.

And our next question comes from Jamesmichael Sherman-Lewis with Citi.

Two here, if I may. Number one, on the .web rollout, I'm curious how you're thinking about the go-to-market approach across marketing channels and specifically where you think the point of sale is most likely to occur? Could these be predominantly net new .web domain sale opportunities or potentially as an attach for a .com domain sale, or even upselling existing customers at renewal? I just want to better understand how you're thinking about possible approaches here.

Thanks. Well, first of all, I think certainly, it will -- there's a couple of different factors here that I think should result in what we think will be a favorable reception by the market and our channel for .web. First of all, it runs on our high assurance infrastructure, and I think that's often underappreciated. Secondly, I mentioned that we would be running a limited registration program. And that gives .com holders the opportunity to get their web. So if they want a companion web, they can have it. So that may be an opportunity that maybe isn't a new website, but a companion website that some may have -- want for a variety of reasons. In addition to that, I think there are a lot of folks who might find it just more appealing. It's a very descriptive. It's a short TLD. This is why we got interested in it years ago at the very beginning. There are, by the way, well over 1,000 TLDs today that the market has to choose from. And many of them, by the way, compared to -- in that market, .com is a very low-priced TLD. We have nothing to say about .web pricing today. We're still working on that. But certainly, there are very few that are really short descriptive TLDs. And I think this is one of them, which is why it appealed to us. So I think that will be inviting for folks. The name space will be available because at this moment, there are 0 registrations in .web. So for those reasons, I think there certainly will be a market. I think the channel, we're very good at engaging with them. They are the ones who do the sort of retail marketing. We try to support them in that. John mentioned that there might be very, very modest marketing expense here late in the year. I think maybe just getting the word out that there's a period in which, if you hold a .com, you may come and register your .web, that's reserved for you. We might do a little bit of messaging, but that would be an entirely nonmaterial expense, a very, very minimum expense for marketing. So I think there's a market for existing holders. I mean there were literally hundreds and hundreds of new gTLDs brought to market over the last 12 years. And many of those are growing at rates much faster than .com. And so there's clearly a market for these TLDs and I think .web will be an attractive option for folks.

That's very helpful. And then just a quick follow-up on the renewals. I know you had some commentary in your prepared remarks about this. But as we look to the back half of the year and start lapping this higher mix of new registrations, and go through the price hike, could you update us on your churn expectations?

What was the last word? Update us on our...

Churn expectations.

Renewal rate. I know we've said in the past quarters, we expected a little bit of a tick down as the mix of first-time renewing names grows because of the strength of our new registrations here in the last, call it, 6 quarters or so. We still have some expectation there in the remainder of this year and then possibly into next year. But I think I would rate something Jim mentioned earlier, and that is we've gotten much better at marketing to our registrars, try to encourage the registrations that they chase to be of higher quality, and our programs are geared towards higher quality. So there's some offset to that natural tendency. And as Jim mentioned in his comments, if you look at the renewal rate that we've had the last couple of quarters, it's been very consistent with our historical rate for first-time renewals. And we had very strong new registrations early in 2025. So I think our renewal rate is holding up fairly well given our programs and just the natural trends that the strength in our new registrations have.

And we'll go next to Alexei Gogolev with JPMorgan.

I guess, Jim, could we start with the discussion around some of your plans for new product rollouts? You talked about possible security services or any other solutions. Will those get the back seat now that you have .web to focus on? Or are you still continue to roll those out in the near term?

I think the short answer to that is no. They will not. The first product that we're likely to roll out, it's just a different product. I would think of it this way. We have done -- we are a pioneering company in public key infrastructure. We started doing this in the '80s. This company was created from RSA, which invented the most popular form of public key cryptography digital signatures. VeriSign was formed to play a role in PKI in the very first browsers that came from Netscape in 1994. There are a lot of components, cryptographic security components that come with that service that we were performing that today are becoming more important. In my comments, I alluded to the requirement to engage deeper with security in the AI world. You don't need to take my word for that. You can see that in the headlines of every newspaper just about every single day that there are concerns that security is going to be a challenge in AI. I'm sure we'll address it. But what we plan to do is offer security features that are sort of going to benefit from operating in our high assurance environment. I -- we believe -- I certainly believe that what we're going to see is that AI -- the security challenge with AI will be met by sharpening and hardening the tools and making full use of them in pursuit of compliance with something called the Zero Trust principles. And that will put demands on these security functions, and I think our infrastructure is well aligned to provide them. And you won't have to wait too much longer to hear about that. But the teams that develop that -- and the teams that developed it have done their work in that. It operates on our infrastructure in a way very similar to the way we ingest and service domain names. And its performance, however, will benefit from our infrastructure immensely. More of it will be needed in an agentic AI world. And I think we're in a great position to offer at global scale, millisecond performance, along with the many hundreds of billions of DNS resolutions that we answer today with significant overcapacity designed that way, we think we can offer a valuable service.

Okay. And maybe another question for John. With regards to CapEx, you kept the guidance for the year unchanged. Obviously, we're seeing price pressure all around. Do you see any risk going forward? What sort of CapEx needs do you think VeriSign will have over the next couple of years?

Yes. So our CapEx guidance for this year is certainly takes into consideration the price increases in the server memory chip kind of markets, and it has had a meaningful impact on our business. Our technology people are very good about adapting and making changes where they can to get more bang for the buck, so to speak. And we've done that. We've even pulled forward some spend that we would have expected next year to avoid price increases that we know are coming in the upcoming 6 months. So we've done some of that. As far as what next year holds, we don't guide to 2027 at this point in time. But our expectation is prices in that marketplace are going to stay elevated and probably be more elevated. We're competing with a lot of data center capacity that's trying to be built right now.

I would just add that regardless of what the market price for the technology, the servers, et cetera, that we need to acquire in the operation of our mission, we will simply make that investment and acquire the equipment that we need without hesitation.

And we'll take our last question from Rob Oliver with Baird.

Great. Sorry, I just had one more. John, for you. I know you guys talked about the price increase you guys have coming up in November. Jim mentioned it earlier, alluding to the potential for kind of pull forward ahead. As you look out at that price increase, is there anything different or how you're thinking about the revenue flow-through from those price increases. Occasionally, we get questions on how, if at all, it differs. We think we've got it pretty well modeled, but just wanted to see if there's any difference or anything you can point to, which would be helpful.

Yes. Sure, Rob. It's important to remember that while our customers pay at the time of registration, our revenue recognition is done ratably over the life of the domain name subscription. So if they subscribe for 1 year, we recognize the revenue from that payment upfront over the next 12 months. And then when you think about the price increase that goes into effect on November 1, a domain name that renews on October 30, let's say, it's October 30, 2027, before we start to realize any price increase. And then it flows through revenue in the following year after that renewal. So you could really think about the price increase as it relates to our existing base, takes 2 years to really flow through revenue completely. And in some cases, longer because we do have some names that are registered for longer than 1 year. It's a relatively small percentage. But think about it as it takes about a 2-year period. Our own modeling, if this helps you a little bit or helps others, is we would expect about 50% of November's 7% price increase on .com to be recognized in 2027 revenues the rest of it would be 2028 and a little bit beyond for the longer-term subscription periods.

Okay. Really helpful. And then just while I've got you, John, just a follow-up to Ygal's question earlier, just on the .web, I think it was his .web ramp costs. I think it was your predecessor who had said at one point that, hey, if we ended up getting .web years ago earlier in the year that there may be some additional costs. I just want to clarify what we heard from you is that those costs are factored into your guidance for this year and not something that as this period ramps, we will see incremental? Just wanted to clarify.

That's correct, Rob. Any costs that we might incur this year, as Jim mentioned, are probably not large, but they are factored into our guidance.

I'll turn the call back over to David Atchley for final comments.

Thank you, operator. Please call the Investor Relations department with any follow-up questions from this call. Thank you for your participation. This concludes our call. Have a good evening.

And this does conclude our call today. Thank you for your participation. You may now disconnect.