VeriSign, Inc. (Nasdaq: VRSN) was down US$5.06 at $76.44 early Thursday — even after reporting quarterly results that topped analyst expectations — as charges led to a wider net loss.
ING Barings reportedly downgraded VeriSign to buy from strong buy early Thursday.
The Mountain View, California-based provider of Internet services said that income before extraordinary items for the fourth quarter ended December 31st rose to $45.5 million, or 21 cents per share, from $4.5 million, or 4 cents, in the same quarter a year earlier. Analysts were expecting earnings before items of 11 cents per share.
Revenue in the quarter jumped 613 percent from a year earlier to $197.4 million.
However, the company posted a net loss of $1.32 billion, or $6.64 per share, after taking into account amortization of goodwill and other extraordinary items.
Reports said that company officials told investors on a conference call that results for 2001 will be better than previously expected, with earnings of 56 to 60 cents per share on revenue that could reach $1 billion. The company also reportedly expects to hire more people over the course of the year.
VeriSign president and chief executive officer Stratton Sclavos said that over the past year, VeriSign has transformed itself “from a security services company into the Internet’s most trusted utility.”
“We enter 2001 as a fully integrated organization offering a portfolio of critical services that all businesses need in order to establish, promote and protect their identity, transactions and communications over the Internet,” Sclavos said.
VeriSign expanded its products and services in the fourth quarter, signing key deals with companies such as online marketplace operator VerticalNet, Inc. (Nasdaq: VERT).
VeriSign provides Internet security services, including authentication of buyers and suppliers through the use of digital certificates and online payment processing.