VeriSign, Inc. (NASDAQ:VRSN) Q4 2017 Earnings Conference Call - Final Transcript
Feb 08, 2018 • 04:30 pm ET
Thank you. (Operator Instructions) We will take our first question from Gregg Moskowitz with Cowen and Company.
Okay. Thank you very much and good afternoon everyone. Jim, in the third quarter the top five keyword searches for .com and while some form of crypto currency and black chain, how incremental do you think crypto has been in driving .com growth as over the past several months or so?
I don't think I have it at the tip of my fingers the precise numbers, but I don't believe that they are material. I've seen a lot of activity in the secondary markets of trading in comp registrations that have crypto in them. But I don't think that there are any meaningful direct contributions to new net registrations in the numbers that we've reported.
There is just a huge amount of interest in cryptocurrencies and Bitcoin as you know that it has the exchanges and what we've seen, I would say specifically is a spike in value in the secondary market of -- any multiple keyword names with crypto in them.
Okay, thanks Jim. And then George, you had told us that you would spend more in marketing Q4 and did and then I know I'm dating myself here, but I would have to go all the way back to 2007 to find another quarter where sales and marketing expense grew this much in absolute dollars on a sequential basis. So, can you maybe just sort of give a little bit more color on the activities that you undertook in Q4 as well as what the sales and marketing strategy is for 2018?
Sure. I mean keep in mind though on an annual basis, our total marketing expense is pretty flat year-over-year. As I talked about few quarters ago, we clearly look to execute on marketing programs that we think drive the best returns for the company, and sometimes those programs we have to pivot during the year and we had lighter marketing expenses as we've talked about in the middle of 2017 and we finally got some programs coming out. We did make a little bit of a shift away from some -- register our marketing programs to more direct marketing programs. We did some advertising for our brands both .com and .net both domestically and abroad. And so, we've been doing a little bit more direct marketing as a result of that. And those programs came out in the fourth quarter and will continue to run in the first half of 2018 here.
Okay, great. And then just one last question for me. Can you expand on why your cash taxes are so much higher in 2018? And as part of that is the SIDEX (ph) tax yield associated with the convert? Is that less valuable going forward under tax reform?
Yes. So as mentioned in my prepared remarks, from a GAAP perspective, we made an accrual for the onetime transition tax and that was partially offset by the revaluation of