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Tucows changes the format of its quarterly earnings conference call, and it’s a great idea

by — Domain Registrars 0 Comments

New investor call model should be emulated.

Publicly traded companies release their earnings once a quarter. They follow it up with an analyst and shareholder call that goes something like this:

The CEO talks about what happened during the quarter. Then she hands it off to the CFO, who recaps the essential numbers. Then the call is turned over to Q&A with financial analysts who cover the stock.

The Q&A part is rarely interesting. Because most companies release their earnings within a short window, the analysts are switching between multiple calls. It’s common to hear “I just got off another earnings call, so apologies if someone already asked this, but…”

Their question is usually basic and yes, someone already asked it.

The questions are rarely insightful because analysts have only just received the earnings data, and the answers are carefully worded to avoid screwing up.

In other words, these calls can be a big waste of time.

So I love what domain name company Tucows (NASDAQ: TCX) decided to do starting with its Q2 results.

Instead of holding an earnings call, Tucows is publishing pre-recorded remarks from the CEO and CFO. Then it will open a seven-day question window for analysts and shareholders to submit questions. Management will publish answers in writing one week later.

I don’t think this will be any easier for Tucows. Analysts will have better questions and expect better answers than what they get on a conference call. But it will avoid the quarterly waste of time and be better for analysts, shareholders, and the media.

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Consensus be damned: here’s how transfers will work at Tucows after GDPR

by — Domain Registrars 7 Comments

Tucows will follow TechOps subcommittee recommendation for domain transfers as ICANN figures out what to do.

Here’s the thing about GDPR and domain name registrars/registries: if they wait for ICANN to figure out how to address GDPR, it will be too late to make the necessary changes to comply with the law. GDPR enforcement goes into effect in just 23 days.

One registrar that has been at the forefront of making changes to comply with GDPR (and has been stating them publicly) is Tucows (NASDAQ: TCX), which owns both Enom and OpenSRS. It is the second largest domain name registrar in the world behind GoDaddy.

The company recently posted about changes it will make to its domain name transfer process as a result of GDPR.

As I’ve written about before, if you can’t access a domain registrant’s email address, you can’t do a transfer under the current methodology mandated by ICANN. Click to continue reading…

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Tucows changes domain name price structure

by — Domain Registrars 20 Comments

New pricing structure draws ire of some customers.

Tucows (NASDAQ:TCX), owner of the dominant reseller domain name platforms Enom and OpenSRS, is introducing new pricing on both of its platforms. The pricing is not uniform across the brands.

The pricing structure looks somewhat like an airline mileage club, requiring a minimum annual spend and number of new transactions in order to get the best pricing.

For example, the top Platinum Plus plan on Enom requires an annual domain spend of $100,000 and 1,000 new registrations or inbound transfers. That plan offers $9.00 .com domains and $12.00 .biz, .info, .net and .org domains.

The baseline Enom account will now pay $13.50 for .com domain names and $17.00 for .biz, .info, .net and .org.

Pricing for other TLDs at Enom hasn’t been adjusted yet but that will change in the future, the company stated on its site. Click to continue reading…

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Digging into Tucows’ annual report

by — Domain Registrars 1 Comment

Some notable items from Tucows’ 10-k.

Tucows (NASDAQ:TCX) filed its annual report yesterday. Here are some things I found interesting:

1. The company now has 558 full-time employees. With $329 million in revenue, that’s about $600k of revenue per employee.

2. Tucows had 22.3M domains under management (DUM) on its own accreditations at the end of 2017 and a further 5.4 million on its platform managed under resellers’ accreditations. That’s a total of 27.7 million DUM.

3. In January, the Company completed a bulk transfer of 2.65 million names to former reseller Namecheap following a court order. As a result of the bulk transfer, the Company will recognize in the first quarter of 2018 $14.6 million of revenue and $14.5 million of cost of goods sold related to previously deferred revenue and deferred prepaid registry fees.

That narrow spread shows how little margin it received on Namecheap domains. However, Tucows did receive expiry and PPC revenue from these domains as well.

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Short seller targets Tucows with scathing report

by — Domain Registrars 3 Comments

Company that is shorting Tucows releases report blasting company.

The same anonymous stock research group that targeted Web.com about four years ago is now going after Tucows.

Copperfield Research released a report about the domain name, mobile and broadband company titled “Cashing in on Neo-Nazis, Child Porn, & A Hidden Lawsuit as Insiders Dump”. The report’s authors have a short position in the company.

The report highlights three major grievances with Tucows (NASDAQ: TCX), a company whose stock doubled in price last year: all three of its business segments have issues, it is helping people operate unsavory websites, and it hasn’t disclosed its imminent loss of domains to Namecheap.

The hyperbole-filled report has some valid points, but I’m the type of person who sees a few misleading statements and then assumes that many of the other statements are wrong.

For example, the report blasts Tucows for its high churn rate when it took over the subscriber base of failed MVNO RingPlus. However, Tucows explicitly stated in earnings calls that it expected very low conversion from this group because RingPlus offered free service.

Also, the report devotes significant ink to a handful of bad websites that have registered their domains within the Tucows ecosystem. The report cites multiple websites with domain names that are registered at Tucows but does not draw a distinction between hosting and domain registration. It amusingly blasts the qualifications of one of Tucows’ compliance offers because she also like to DJ in her spare time.

On the NameCheap issue, it will be interesting to see how much of an impact the loss of Namecheap’s domains will have on Tucows. The revenue hit is real but the profit hit is unclear.

Shares in Tucows are down about 8% today. After opening the year around $70 they are now trading for $55.

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