NameSilo Shatters Records as Revenue Soars In Q3 2024
Domain registrar platform NameSilo Technologies (CSE: URL) reported its Q3 2024 financial results, highlighting significant year-over-year revenue and profitability improvements. Revenue for the quarter reached $14.35 million, a 15.2% increase compared to $12.45 million in Q3 2023, continuing an impressive eight-quarter streak of growth.
The boost in revenue was attributed to a rise in domains under management and higher sales in ancillary services.
Gross profit improved to $3.21 million, representing 22.4% of revenues compared to $2.26 million or 18.2% in Q3 2023. Notably, the 22.4% gross margin was the highest in company history, signaling improved operational efficiency or pricing strategy. However, given that cost of sales still represents 77.6% of revenue, the company’s ability to further optimize costs appears limited.
Operating income reached $1.24 million, up 61% from $770,085 in Q3 2023 and 13% higher than Q2 2024’s $1.10 million. Net income swung significantly to $488,064 from a $103,394 loss in Q3 2023. The net margin for the quarter was 3.4%, a marked improvement over the prior year’s negative performance.
Sequentially, however, net income declined from $731,216 in Q2 2024. This decrease, despite higher revenue and gross profit, was partially driven by a $107,673 loss on digital currency valuation compared to a $55,000 gain in the prior quarter. The company’s reliance on bitcoin as part of its asset strategy introduces volatility into its earnings, which could be problematic for long-term stability.
Adjusted EBITDA for the quarter was $1.45 million, up 39% from $1.04 million in Q3 2023 and slightly higher than the $1.41 million reported in Q2 2024.
Deferred revenue grew to $29.66 million as of September 30, 2024, compared to $26.26 million a year earlier and $28.10 million in the prior quarter. However, reliance on deferred revenue growth raises questions about the company’s ability to convert these prepayments into long-term recurring revenues.
The company’s balance sheet showed notable improvement, with cash and equivalents at $4.98 million, up significantly from $2.38 million at year-end 2023 and $4.17 million in Q2 2024. This increase was bolstered by $2.32 million in cash flow from operations during the quarter, more than double the $1.01 million generated in Q3 2023. However, a working capital deficit of $10.98 million highlights lingering liquidity challenges despite the elimination of convertible debt.
Management’s decision to repurchase shares continues, with 850,500 shares canceled during the quarter and an additional 438,500 bought back subsequently.
NameSilo’s total bookings grew modestly to $14.34 million in Q3 2024 from $14.08 million in Q2 2024 and $13.31 million in Q3 2023. Although the year-over-year increase of 7.8% aligns with broader revenue growth, the sequential deceleration warrants caution. Investments totaling $3.64 million as of September 30, 2024, down from $4.74 million at the end of 2023, reflect divestitures and a conservative approach to portfolio management.
The company said it remains focused on diversifying revenue streams through value-added services and expanding its customer base, recently surpassing 5 million domains under management.
NameSilo last traded at $0.45 on the Canadian Securities Exchange.
Information for this briefing was found via Sedar and Name Silo Technologies. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
