VRSNVerisign

With the introduction of new gTLDs, many of our registrars and resellers have chosen to, and may continue to choose to, focus their short- or long-term marketing efforts on these new offerings and/or reduce the prominence or visibility of our products and services on their e-commerce platforms. Our registrars and resellers sell domain name registrations of other competing registries, including new gTLDs, and some also sell and support their own services for websites such as email, website hosting, and other services. Our With the planned introduction of a new round of gTLDs, registrars and resellers resellers, as they have done in the past, may be more motivated to sell to registrants to whom they can also market in the future focus their own services. short- or long-term marketing efforts on new offerings and/or reduce the prominence or visibility of our products and services on their e-commerce platforms. To the extent that registrars and resellers focus more on selling and supporting their services and less marketing on the registration and renewal of domain names in the gTLDs we operate, our revenues could be adversely impacted. Our ability Likewise, our registrars and resellers may be more motivated to successfully market our services to, and build and maintain strong relationships with, new and existing registrars or resellers is a factor upon which successful operation of our business is dependent. If we are unable to keep a significant portion of their marketing efforts focused on selling registrations of domain names in the gTLDs we operate, as opposed registrants to other competing gTLDs, including the new gTLDs, or whom they can also market their own services, which could disadvantage our business gTLDs and could be harmed. adversely impact our revenues.

Demand for .com and .net domain names has been primarily driven by continued internet growth and marketing activities carried out by us and our registrars. However, the demand for .com and .net domain names may be limited by competitive pressure from ccTLDs, other gTLDs, services that offer TLDs and alternatives for an online presence, such as social media, ongoing presence. Additionally, changes in internet practices practices, consumer behavior, and behaviors of consumers and business, global economic conditions, as well as the motivation of existing domain name registrants managing their investment in domain names, such as for resale at increased prices or for revenue generation through website advertising, and global economic conditions, has limited the may impact demand for .com and .net domain names and may continue to do so in the future. While the core value proposition of a names. Our domain name remains strong, challenging economic base increased during 2025 compared to 2024, with higher new registrations and regulatory renewal rates, as business conditions improved following a period of decline during 2024 and as registrars focus more on customer acquisition and have continued to weaken demand for .com and .net domain name registrations in China, and some registrars, particularly in the U.S., have shifted their focus to increasing profitability through higher retail pricing and a decrease in engage with our marketing activities targeting new customer acquisition. The combination of these factors has negatively impacted our renewal rates and the volume of new .com and .net domain name registrations, resulting in a decline in our domain name base. programs.

In December 2023, the Financial The Company adopted Accounting Standards Board (“FASB”) issued ASU Update (“ASU”) No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, which improves the transparency of income tax disclosures by requiring consistent categories and greater disaggregation of information in the effective tax rate reconciliation and income taxes paid disaggregated by jurisdiction. This guidance will be effective for our 2025 Form 10-K. We do not expect the has been applied prospectively. The adoption of this guidance to ASU 2023-09 did not have a material impact on our the Company’s consolidated financial statements. Refer to Note 11, “Income Taxes,” for income tax disclosures.

Before .web could be awarded to NDC, Afilias filed another IRP on July 14, 2023, and as a result, ICANN’s processing of NDC’s .web application remains paused. Similar to the first IRP, Afilias again seeks to invalidate the .web auction and have .web awarded to Afilias. On April 11, 2024, Verisign and NDC submitted a written request to participate in the IRP. Additional In November 2025, the IRP hearings and Panel held a hearing on Afilias’ claim. Post-hearing briefings are scheduled during 2025. expected to be filed in the first half of 2026.