MOUNTAIN VIEW, Calif.—Shares of VeriSign Inc. lost ground despite a rebound in the company’s mobile content business during the second quarter.
The network infrastructure and wireless content company said its Jamster and Jamba businesses generated a combined $74 million during the recent quarter, with the recently acquired m-Qube pulling in an additional $12 million. VeriSign ended the quarter with nearly 9 million subscribers to its mobile content business, marking a 24-percent increase year-over-year.
VeriSign and other content providers have suffered in recent months as industry organizations and state agencies institute policies to regulate subscription-based mobile content services. Firms have been hit with fines in several European and Asian markets for allegedly deceiving consumers and marketing to young teens.
VeriSign said the latest figures indicate the content industry is stabilizing in the wake of the backlash.
“Our second-quarter results reflect solid performance in the core business and higher-than-forecasted revenue in the mobile content business, leading to strong operating income for the quarter,” said Dana Evan, VeriSign’s chief financial officer. “Driven by our recurring revenue model, these results improved our deferred revenue to $560 million and allowed us to deliver solid operating cash flows of over $90 million this quarter.”
VeriSign shares dipped $1.44, or 7 percent, to $19.15 following the report, however.
Meanwhile, Google Inc. gave a nod to its wireless efforts in a conference call on its quarterly financials. Google, which posted unexpectedly high profits in the second quarter, said a successful partnership with Japanese operator KDDI Corp. is evidence the company can easily extend its mobile search service to mobile phones.
“On mobile devices, the usage model is about finding information rather than browsing, and, obviously, also the network of advertisers, which is very much global and strong,” Google Senior Vice President Omid Kordestani said during a conference call, according to SeekingAlpha.com. “We can easily adapt that model to the mobile devices and make that network of advertisers flow into these different platforms.”
