Buying Back a Third of the CompanyNarrow moat

VeriSign (VRSN) — moat facet

Net income rose 120% over the decade and earnings per share rose 227% — the difference was bought, not earned.

VeriSign has spent thirty years buying its own stock and it shows on every line of the balance sheet.

A third of the company retired, and most of the per-share compounding bought rather than earned.

Diluted shares were about 133 million in 2015. They were 90.3 million in July 2026 — a third of the company retired.¹ In 2025 alone VeriSign repurchased 3.4 million shares for $858.6 million, and the board keeps topping the authorisation back up to $1.50 billion, most recently in July 2026.²

The accounting consequence is that shareholders' equity has been negative for years, with an accumulated deficit above $11.3 billion.³ This alarms screening software and nobody else. It means the company has returned more to shareholders than it has ever retained, which for a business requiring no capital is the correct answer.

The effect on per-share figures is the whole point. Between 2015 and 2025 net income rose about 120%, from $375.2 million to $825.7 million. Earnings per share rose 227%, from $2.82 to $8.81.⁴ The difference — more than a hundred percentage points of compounding — was bought, not earned.

It also does something for holders who never trade. Berkshire Hathaway has held 8,989,880 VeriSign shares unchanged through each of the last three quarters; over the same period the share count fell from 93.9 million to 90.3 million, taking Berkshire from roughly 9.6% of the company to roughly 10.0% without a single purchase.⁵

The limit is arithmetic: at 31 times earnings, buybacks retire about 3% of the company a year rather than 10%.

Moat trajectory: Narrowing

The buyback still retires stock, but it does less each year: at 31 times earnings the same free cash flow buys about 3% of the company, against 4% at the multiples of two years ago. The mechanism is intact and the leverage on it is falling.

The number that tests this moat

Reported

Diluted shares outstanding

90.3 million, from about 133 million in 2015

A third of the company retired. Over the same decade net income rose about 120% while earnings per share rose 227%; the difference was bought. VeriSign repurchased 3.4 million shares for $858.6 million in 2025 and the board keeps refilling the authorisation to $1.50 billion. Watch shares retired per dollar spent rather than dollars spent — at 31 times earnings it buys about 3% of the company a year.

Source: VeriSign Form 10-K FY2025 and Q2 2026 Form 10-Q ↗

⚠ Threats to the moat

⚠ THREAT 01

Buybacks at Thirty-One Times Do Less Work

The repurchase does least work exactly when the market is most confident, and 31 times earnings retires about 3% a year.

References

Reported90,300,000 shares were outstanding at 17 July 2026.
VeriSign, Inc., Form 10-Q for the quarter ended 30 June 2026 (SEC, CIK 1014473). Revenues $434.6M for the quarter and $863.5M for the six months, each up 6%; operating income $296.3M and $589.9M, up 6% and 7%. Net income $216.5M and $431.0M; diluted EPS $2.38 and $4.71 on 91.1 and 91.4 million diluted shares. Total assets $1,802.8M; deferred revenues $1,084.8M current and $364.1M long-term; current senior notes $549.3M and long-term senior notes $1,785.1M. Net cash provided by operating activities $504.0M for the six months against $493.8M; deferred revenues increased $64.5M. 90,300,000 shares of common stock were outstanding at 17 July 2026. The domain name base was 179.1 million at 30 June 2026, up 5.1%; 12.7 million new registrations were processed in the quarter; the final first-quarter 2026 renewal rate was 76.3%. $666.0 million remained for repurchases at 30 June 2026 before an additional $884.2 million was authorised effective 23 July 2026. — Q2 2026 · publ. 2026-07-23 · source ↗
ReportedVeriSign repurchased 3.4 million shares for $858.6M in 2025 under a programme authorised to $1.50 billion.
VeriSign, Inc., Form 10-K FY2025 — Item 7, Management's Discussion and Analysis. Revenues $1,656.6M (+6%) against $1,557.4M in 2024 (+4%) and $1,493.1M in 2023; operating income $1,121.0M (+6%). Costs as a percentage of revenues: cost of revenues 11.8% (12.3%, 13.2%), research and development 6.3% (6.2%, 6.1%), selling, general and administrative 14.2% (13.6%, 13.7%), total costs and expenses 32.3% (32.1%, 33.0%), operating income 67.7% (67.9%, 67.0%), interest expense (4.6)%, net income 49.8% (50.4%, 54.8%). The .com and .net domain name base was 173.5 million at 31 December 2025 (+3%) against 169.0 million in 2024 (−2%) and 172.7 million in 2023. VeriSign processed 41.7 million new .com and .net registrations in 2025 against 37.4 million in 2024; the final third-quarter 2025 renewal rate was 75.4% against 72.2%. The registry-level wholesale fee rose from $9.59 to $10.26 for .com effective 1 September 2024 and from $9.92 to $10.91 for .net effective 1 February 2024. Geographic revenues: U.S. $1,093.1M (+6%), EMEA $279.4M (+12%), APAC $184.6M (+5%), other $99.5M (+3%). VeriSign repurchased 3.4 million shares for $858.6M in 2025, with $1.08 billion remaining under a programme authorised to $1.50 billion effective 24 July 2025. — FY2025 · publ. 2026-02-05 · source ↗
ReportedShareholders' equity is negative, with an accumulated deficit above $11.3 billion.
VeriSign, Inc., Form 10-K FY2025 — Item 8, consolidated financial statements and notes. Net income $825.7M (2024 $785.7M, 2023 $817.6M); diluted EPS $8.81 ($8.00, $7.90) on 93.8 million diluted shares (98.2, 103.5); income before income taxes $1,068.5M; income tax expense $242.8M. Balance sheet at 31 December 2025: cash and cash equivalents $307.9M, marketable securities $272.6M, property and equipment net $213.7M, goodwill $52.5M, deferred tax assets $233.2M, deposits to acquire intangible assets $145.2M, total assets $1,325.9M; accounts payable and accrued liabilities $298.0M, deferred revenues $1,035.1M current and $349.4M long-term, long-term senior notes $1,788.2M, total current liabilities $1,333.1M — a total stockholders' deficit with an accumulated deficit above $11.3 billion. Net cash provided by operating activities $1,091.1M; the deferred revenues balance increased $80.2M in 2025 ($58.1M in 2024, $27.0M in 2023) and $934.7M of revenue recognised in 2025 had been in the opening deferred balance. Major customers note: the largest customer accounted for approximately 31% of revenues in 2025 and approximately 32% in 2024 and 2023, and the Company does not believe the loss of this customer would have a material adverse effect because end-users would transfer to its other existing customers. Dividends of $0.77 per share were declared in each of the three quarters from the second quarter of 2025, totalling $2.31 per share and $215.2M, accounted for as a reduction of additional paid-in capital; a dividend of $0.81 per share was declared on 3 February 2026. — FY2025 · publ. 2026-02-05 · source ↗
ReportedNet income rose from $375.2M in 2015 to $825.7M in 2025 while diluted earnings per share rose from $2.82 to $8.81.
SEC EDGAR XBRL company facts for VeriSign, Inc. (CIK 1014473) — annual revenue, operating income, net income and diluted earnings per share as filed. Revenue $1,059.4M (2015) rising to $1,656.6M (2025); operating income $605.9M to $1,121.0M; net income $375.2M (2015), $440.6M (2016), $457.2M (2017), $582.5M (2018), $612.3M (2019), $814.9M (2020), $784.8M (2021), $673.8M (2022), $817.6M (2023), $785.7M (2024), $825.7M (2025); diluted EPS $2.82 (2015) to $8.81 (2025). — FY2015–FY2025 · publ. 2026-02-05 · source ↗
ReportedBerkshire Hathaway held 8,989,880 VeriSign shares in each of the quarters ended December 2025, March 2026 and June 2026, while shares outstanding fell from 93.9 million in April 2025 to 90.3 million in July 2026.
Berkshire Hathaway Inc., Form 13F-HR information table for the quarter ended 30 June 2026 (SEC, CIK 1067983) — VeriSign, Inc. holdings of 972,947 shares valued at $244,754,547 and 8,016,933 shares valued at $2,016,739,665, a combined 8,989,880 shares. The same combined holding of 8,989,880 shares was reported for the quarters ended 31 December 2025 and 31 March 2026. — Q2 2026 · publ. 2026-08-14 · source ↗

Sources

VeriSign Form 10-K, FY2025 (SEC EDGAR)

Generated September 23, 2026