Shareholder letter
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Shareholder Update First Quarter 2025 | May 21, 2025
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T o our Shareholders, our Users & our People 2025 is off to an encouraging start, marked by robust top of funnel demand and resilient growth momentum against a rapidly shifting macro backdrop. Strong first-quarter performance was driven by solid execution across our strategic pillars and significant strides in our ambitious product pipeline. We introduced a range of new AI-powered capabilities, dozens of additional Studio features, and new avenues to further enable SMB success, in-line with our strategic priorities and long-term product vision. Notably, we marked a major milestone earlier this month with the long-awaited release of Wixel, our standalone creation platform that extends Wix’s high-end design horsepower beyond websites. As the first version of our next-gen AI-powered visual design platform, Wixel represents the culmination of years of development in advanced design and AI and unifies the best models, intuitive UI, and powerful high-end features into one cohesive platform. With one of the largest design studios in the world, Wix brings a deep understanding of style, creativity, and user experience to the AI-powered design and creation arena. Unlike most other platforms that rely solely on text prompts, which often leave users struggling to visualize their desired output or require tons of design knowledge, Wixel leverages Wix’s unmatched design expertise to deliver results that are both visually compelling and tailored to real business needs. Importantly what makes Wixel unique from other offerings is the integration of the best available AI models into one UI, including those for object and background editing among many others, with a constant pipeline of the latest advancements in AI. Moreover, hosting hundreds of millions of websites over the past decade plus gives us unique insight into how design choices influence engagement – enabling us to continuously finetune both our technology and creative approach to deliver a product that truly performs. These strengths guarantee Wixel to be not just another text-to-image tool – it is a smart, business-focused platform built to evolve with the fast-changing AI landscape. So what led us to building Wixel? There’s been an unquestionable growing demand for accessible, intelligent design solutions over the past few years with over 40 million images edited and saved by Wix users in 2024 alone. This demand was further supported by surging search interest in easy-to-use photo and video editors. However, video and image editing is very difficult today with most people unable to achieve the results they want on their own. This is a challenge not only for Wix users, who need high-quality media to build impressive websites, but for anyone looking to create impactful visuals online. With our powerful suite of AI digital design capabilities thoughtfully enhanced over the past nine years integrated within existing products, there was no one better positioned than Wix to democratize visual design and make creativity accessible to everyone. With Wixel, anyone, regardless of skill level, can now create beautiful visuals with just a few clicks – designing and editing website and social media graphics, marketing assets, resumes and much more. This marks our step beyond the boundaries of web development to empower everyone to create on their own terms. My long-term vision is to revolutionize the design market with Wixel by putting complete visual editing control in the hands of everyone, much like Wix has done for website creation. In a space crowded with digital design tools, and high-end ones reserved for skilled professionals, users are seeking more than just functionality. They want a seamless, enjoyable experience that combines the best AI models with an intuitive and visually compelling interface. This is where Wixel shines, building on Wix’s proven strength in product development as well as design. But breaking into and winning in this market takes more than great technology. It requires scale: addressing a wide range of user intents, optimizing every step of the user journey, and offering tailored templates that meet diverse creative needs. Wixel delivers all of this and will continue to push the boundaries of what's possible as we roll out new capabilities. I want to be clear: this initial launch marks only the very beginning of a long and ambitious journey with still much to do. With a robust roadmap planned for the next couple of years, this platform will continue to evolve, unlocking new ways for users to bring their ideas to life. Thank you for your continued trust and support. Sincerely, Avishai Abrahami, Co-Founder and CEO 2 WIX First Quarter 2025
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Product & Business Updates We’ve been continuing our focused investment in AI to provide Wix users with an AI assistant to help guide them with everything they do. In April, Wix announced the launch of Astro, an AI-powered assistant to simplify the user experience providing users with seamless access to essential tools and insights, enhancing efficiency and simplifying site operations. Integrated throughout the dashboard, the assistant allows users to ask questions, optimize site settings, complete tasks, and discover useful features. By guiding users toward relevant tools and add-ons, Astro is expected to drive app installations, increase package upgrades, and encourage the adoption of premium features. Additionally, we released a series of tools for website automation and real-time customization while managing ongoing tasks and overcoming the limitations of traditional personalization tools that require heavy manual setup. This suite includes: ● Adaptive content application: a tool designed to personalize website experiences for site visitors by generating dynamic content based on visitor characteristics and instructions, ultimately enhancing engagement and user experience ● Wix Functions: a no-code interface that allows users to customize outcomes for various business scenarios, enabling businesses to operate more smoothly and effectively ● Wix Automations: a builder designed to support advanced business workflows with a highly intuitive, fully customizable automation engine These tools help businesses effortlessly optimize their operations for enhanced efficiency, while ensuring a seamless visitor experience without performance drawbacks like increased load times. Earlier this month, we launched the Wix Model Context Protocol (MCP) Server. This serves as a bridge between Wix’s powerful headless infrastructure and modern AI-driven development workflows. It enables anyone – from developers to business owners and even vibe coders – to deliver production-ready Wix business solutions seamlessly through AI coding assistants and LLMs, ensuring they can generate code for a vast array of needs and manage Wix businesses using natural language. WIX First Quarter 2025 3
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Demand for building online was stronger than expected entering 2025 with our new Q1’25 user cohort generating $35.5 million in bookings in the first quarter. Q1’25 user cohort bookings were 12% higher than the bookings generated by the Q1’24 cohort in its first quarter, marking a notable acceleration in new cohort growth that was almost entirely driven by better fundamentals and product innovation. Encouragingly, new cohort strength has continued through April and early May. We expect stronger new cohorts to layer on throughout the year as our new strategic initiatives and product enhancements become more impactful. As a result, we continue to expect bookings and revenue growth to accelerate in 2H. This step-up in Q1 new cohort bookings was driven by a robust top of funnel, particularly in select high-spend geographic regions. This resulted in approximately 5.3 million new users joining the platform in the first quarter, or 7% more users compared to the prior year period. In this larger new cohort, the mix of high-intent and commerce-led users remained high as continuous product innovation attracted more users with increasingly sophisticated needs to achieve their goals on Wix. Conversion of new users into paid subscriptions was healthy, driven by steady widening of our AI onboarding funnel as well as strong continued Partner adoption of Wix Studio. We ended Q1’25 with over 287 million registered users. In addition to higher volume, improved monetization also drove the acceleration in Q1’25 cohort bookings. Higher average revenue per subscriber (ARPS) was a result of new users purchasing higher-priced packages as well as increasing attachment of Business Solutions applications, particularly Google Workspace and marketing offerings. We captured the strong top of funnel demand we saw through the first quarter, while continuing to prudently manage acquisition marketing investments against our guardrails. Strong execution of our strategy puts us on track to achieve a time to return on investment (TROI) of 4-5 months on our Q1’25 user cohort. Steady TROI while onboarding a meaningfully bigger amount of cohort bookings underscores Wix’s strong global brand presence across all of our target user audiences, reinforcing our leadership position as the go-to website creation platform for Self Creators while successfully moving upmarket and penetrating the Partner ecosystem. Prior user cohorts also remained healthy as bookings attributed to existing users continued to build over time. Bookings growth was driven by steady conversion of users into new paid subscriptions, strong retention behavior and increased ARPS. These drivers were further magnified in our Partners business, as previously onboarded professional users built more websites, attached additional Business Solutions products and increased GPV as they created more sophisticated and complex projects on Wix. Total revenue grew to $473.7 million in Q1’25, up 13% y/y and above the high end of our guidance range. Outperformance was driven by strong revenue growth across Creative Subscriptions and Business Solutions, bolstered by another consecutive quarter of Self Creators growth acceleration and Partners momentum. Revenue on a y/y constant currency basis was $477.9 million, or 14% y/y growth, in the first quarter. Total bookings grew to $510.9 million in Q1’25, up 12% y/y, with solid growth across both Creative Subscriptions and Business Solutions segments underpinned by a robust new user cohort. Bookings on a y/y constant currency basis was $519.0 million, or 13% y/y growth in the first quarter. Creative Subscriptions Revenue and Bookings Creative Subscriptions revenue grew to $337.7 million in Q1’25, up 11% y/y. Creative Subscriptions ARR grew to $1.373 billion as of the end of Q1’25, up 10% y/y. Creative Subscriptions bookings grew to $369.5 million in Q1’25, up 10% y/y. Both bookings and revenue growth were driven by strong business fundamentals across the robust new user cohort that onboarded in Q1’25 as well as healthy prior user cohorts, as previously discussed. Financial Review WIX First Quarter 2025 4 User Cohort Performance Revenue and Bookings
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Business Solutions Revenue and Bookings Business Solutions revenue grew to $136.0 million in Q1’25, up 18% y/y. Business Solutions bookings grew to $141.4 million in Q1’25, up 15% y/y. Both bookings and revenue growth were driven by strong adoption of business applications, particularly Google Workspace and our marketing offering, as well as solid transaction revenue growth. Transaction revenue in Q1’25 was $58.9 million, or 43% of Business Solutions revenue, up 19% y/y. Growth was driven by increased take rate, up sequentially to 1.74%, as more merchants adopted Wix Payments and we continued to benefit from an expanded Wix Payments partner ecosystem. Improved take rate was coupled with GPV growth with particular strength across services verticals such as Events, Bookings and Pricing Plans. Q1 GPV grew 8% y/y to $3.4 billion, or 10% on a constant currency basis. GPV continued to be negatively impacted by the accelerating drawdown in a minor subsidiary, which posed a 2 pt headwind to GPV growth in the first quarter. We expect this headwind to persist through the rest of the year. Subsidiary GPV is monetized at significantly lower rates compared to the rest of our GPV so the expected impact to transaction revenue is minimal. Core GPV excluding subsidiaries grew 12% year over year in constant currency. Commerce on Wix continues to be led by Partners, who contributed to over 50% of Q1 GPV as these larger and more mature businesses compound GPV at a higher clip over time. WIX First Quarter 2025 5 Partners revenue in Q1’25 totaled $171.6 million, or 36% of total revenue, up 24% y/y. Growth was driven by continued high levels of Studio adoption, particularly among larger agencies with bigger project pipelines. Bookings from new Studio subscriptions accelerated as new Partners converted faster and built their first Studio project more quickly and existing Partners built additional websites on Studio. Partners growth was also driven by an increased number of overall subscription purchases, particularly higher priced packages as well as increased adoption of business applications and increasing GPV. Revenue from our B2B partnerships also continued to contribute to Partners revenue growth as these users monetize better over time. Partners Revenue Total non-GAAP gross margin was 69% in Q1’25, which was in-line with our expectations. Creative Subscriptions non-GAAP gross margin was 84% in Q1’25. Business Solutions non-GAAP gross margin was 31% in Q1’25. Steady and resilient gross margins are the result of efficiencies from a carefully maintained cost structure cultivated over the past few years, including continuously optimized terms with hosting providers and AI-driven productivity gains. Business Solutions gross margins also continued to benefit from outperformance of high-margin business applications as well as increased payments gross margin due to continued scale. Gross Profit and Margin
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WIX First Quarter 2025 6 GAAP net income was $33.8 million in Q1’25, or $0.57 per diluted share. Non-GAAP net income was $93.9 million in Q1’25, or $1.55 per diluted share. Earnings and Earnings Per Share Free cash flow in Q1’25 totaled $142.4 million, or 30% of revenue. This marks ~150 bps of sequential margin expansion, driven by strong bookings performance and continued operating efficiency tailwinds. In February, we implemented a new $200 million Board repurchase authorization following the completion of our previous program at the beginning of the year. In May, our Board authorized an increase of $200 million to this current repurchase program for an aggregate of up to $400 million of repurchases of Wix securities. This upsized Board authorization underscores Wix’s continued commitment to returning value to shareholders, supported by steadily strengthening free cash flow generation. We ended Q1’25 with approximately $1,076.9 million in cash and cash equivalents and $573.7 million outstanding of our convertible bond due in August 2025. Our total employee count at the end of Q1’25 was 5,275, down slightly q/q. Cash Flow, Balance Sheet and Other Items Operating Expenses and Margin Non-GAAP R&D expenses were $96.0 million in Q1’25, an increase of 3% y/y and 1% q/q. As a percent of revenue, non-GAAP R&D expenses were 20% in Q1’25, a decrease from 22% of revenue in the year ago quarter. The y/y and q/q increases in R&D expenses were primarily due to higher payroll expenses as we modestly added developer headcount in the most recent quarter, in-line with hiring plans for the year. Non-GAAP S&M expenses were $101.6 million in Q1’25, an increase of 6% y/y and q/q. As a percent of revenue, non-GAAP S&M expenses were 21% in Q1’25, a decrease from 23% of revenue in the year ago quarter. The y/y and q/q increases in S&M expenses were primarily driven by higher acquisition marketing spend to capture the strong top of funnel demand we saw through the first quarter. Even as marketing investments increased, expected TROI on our new user cohort importantly remains stable at 4-5 months, highlighting the strong execution of our strategy. Non-GAAP G&A expenses were $28.4 million in Q1’25, a slight increase y/y and a decrease of 4% q/q. As a percent of revenue, non-GAAP G&A expenses were 6% in Q1’25, a decrease from 7% of revenue in the year ago quarter. The q/q decrease in G&A expenses was primarily due to salary bonuses awarded at the end of last year that did not reoccur in the first quarter. Non-GAAP operating income was $99.8 million, or 21% of revenue in Q1’25, an increase of 44% compared to Q1’24.
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Outlook Healthy first quarter results demonstrate impactful product innovation and disciplined execution of our key growth initiatives, including Studio, AI and our focus empowering Self Creators. Notably, new cohort strength remains robust through April and early May against a dynamic macro backdrop. We expect new cohort strength to continue and drive top-line growth acceleration in 2H as additional cohorts layer on throughout the year. While we are encouraged by our strong Q1 results and robust top of funnel, we are maintaining full year bookings outlook of $2,025 - 2,060 million, up 11-13% y/y. This reflects conservatism due to macro uncertainty, specifically in our Business Solutions segment, with potential volatility offset by fully dissipating FX headwinds. With these same considerations, we are also maintaining our full year revenue outlook of $1,970 - 2,000 million, up 12-14% y/y. We expect total revenue in Q2 2025 to be $485 - 489 million, up 11-12% y/y. For the full year 2025, we continue to expect non-GAAP total gross margin of ~70% and non-GAAP operating expenses to be 47-48% of revenue for the full year. We continue to expect to generate free cash flow of $590 - 610 million, or ~30-31% of revenue. As a result, we remain on track to achieve Rule of 45 in 2025 at the high end of our outlook. WIX First Quarter 2025 7
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Appendix Notes and Modeling Clarifications WIX First Quarter 2025 8 Creative Subscription Revenue and Creative Subscription Bookings refer to revenue or bookings, as applicable, generated from premium subscriptions, including premium subscriptions bundled with vertical solutions and domain name subscriptions and exclude any revenue or bookings, as applicable, included under Business Solutions Revenue or Bookings, respectively. Our total revenue is comprised of Business Solutions Revenue and Creative Subscriptions Revenue. Our total bookings is comprised of Business Solutions Bookings and Creative Subscriptions Bookings. Business Solutions Revenue and Business Solutions Bookings refer to all revenue or bookings, as applicable, generated from business solutions and exclude any revenue or bookings, as applicable, included under Creative Subscriptions Revenue or Bookings, respectively. Unbilled contractual obligations: we present firm multi-year commitments for the full contract term in bookings in the quarter in which the agreement is executed. The commitment amount for the upcoming 12 months is recognized as short-term accounts receivable and deferred revenue, and the remaining commitment amount will be recorded in our bookings as unbilled contractual obligations. B2B partnership bookings is a subset of total bookings representing the full contractual commitments received from B2B partners, such as Vistaprint and LegalZoom, as well as enterprise partners. GPV or Gross Payments Volume includes the total value, in US dollars, of transactions facilitated by our platform. Transaction revenue is a portion of Business Solutions revenue, and we define transaction revenue as all revenue generated through transaction facilitation, primarily from Wix Payments as well as Wix POS, shipping solutions and multi-channel commerce and gift card solutions. Take rate is defined as our transaction revenue as a percentage of GPV. Partners revenue is defined as revenue generated through agencies and freelancers that build sites or applications for other users (“Agencies”) as well as revenue generated through B2B partnerships, such as LegalZoom or Vistaprint (“Resellers”). We identify Agencies using multiple criteria, including but not limited to, the number of sites built, participation in the Wix Partner Program and/or the Wix Marketplace or Wix products used (incl. Wix Studio). Partners revenue includes revenue from both the Creative Subscriptions and Business Solutions businesses.
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Wix will host a conference call to discuss the results at 8:30 a.m. ET on Wednesday, May 21st, 2025. A live and archived webcast of the conference call will be accessible from the "Investor Relations" section of the Company’s website at https:/ /investors.wix.com/. Conference Call and Webcast Information Non-GAAP Financial Measures and Key Operating Metrics To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, Wix uses the following non-GAAP financial measures: bookings, cumulative cohort bookings, bookings on a constant currency basis, revenue on a constant currency basis, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, free cash flow, free cash flow on a constant currency basis, free cash flow, as adjusted, free cash flow margins, non-GAAP R&D expenses, non-GAAP S&M expenses, non-GAAP G&A expenses, non-GAAP operating expenses, non-GAAP cost of revenue expense, non-GAAP financial expense, non-GAAP tax expense (collectively the "Non-GAAP financial measures"). Measures presented on a constant currency or foreign exchange neutral basis have been adjusted to exclude the effect of y/y changes in foreign currency exchange rate fluctuations. Bookings is a non-GAAP financial measure calculated by adding the change in deferred revenues and the change in unbilled contractual obligations for a particular period to revenues for the same period. Bookings include cash receipts for premium subscriptions purchased by users as well as cash we collect from business solutions, as well as payments due to us under the terms of contractual agreements for which we may have not yet received payment. Cash receipts for premium subscriptions are deferred and recognized as revenues over the terms of the subscriptions. Cash receipts for payments and the majority of the additional products and services (other than Google Workspace) are recognized as revenues upon receipt. Committed payments are recognized as revenue as we fulfill our obligation under the terms of the contractual agreement. Bookings and Creative Subscriptions Bookings are also presented on a further non-GAAP basis by excluding, in each case, bookings associated with long term B2B partnership agreements. Non-GAAP gross margin represents gross profit calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization, divided by revenue. Non-GAAP operating income (loss) represents operating income (loss) calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, acquisition-related expenses and sales tax expense accrual and other G&A expenses (income). Non-GAAP net income (loss) represents net loss calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, sales tax expense accrual and other G&A expenses (income), amortization of debt discount and debt issuance costs and acquisition-related expenses and non-operating foreign exchange expenses (income). Non-GAAP net income (loss) per share represents non-GAAP net income (loss) divided by the weighted average number of shares used in computing GAAP loss per share. Free cash flow represents net cash provided by (used in) operating activities less capital expenditures. Free cash flow, as adjusted, represents free cash flow further adjusted to exclude one-time cash restructuring charges and the capital expenditures and other expenses associated with the buildout of our new corporate headquarters. Free cash flow margins represent free cash flow divided by revenue. Non-GAAP cost of revenue represents cost of revenue calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP R&D expenses represent R&D expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP S&M expenses represent S&M expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP G&A expenses represent G&A expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP operating expenses represent operating expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP financial expense represents financial expense calculated in accordance with GAAP as adjusted for unrealized gains of equity investments, amortization of debt discount and debt issuance costs and non-operating foreign exchange expenses. Non-GAAP tax expense represents tax expense calculated in accordance with GAAP as adjusted for provisions for income tax effects related to non-GAAP adjustments. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. For more information on the non-GAAP financial measures, please see the reconciliation tables provided below. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company is unable to provide reconciliations of free cash flow, free cash flow margin, free cash flow, as adjusted, bookings, cumulative cohort bookings, non-GAAP gross margin, non-GAAP operating expenses, and non-GAAP tax expense to their most directly comparable GAAP financial measures on a forward-looking basis without unreasonable effort because items that impact those GAAP financial measures are out of the Company's control and/or cannot be reasonably predicted. Such information may have a significant, and potentially unpredictable, impact on our future financial results. WIX First Quarter 2025 9
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Wix also uses Creative Subscriptions Annualized Recurring Revenue (ARR) as a key operating metric. Creative Subscriptions ARR is calculated as Creative Subscriptions Monthly Recurring Revenue (MRR) multiplied by 12. Creative Subscriptions MRR is calculated as the total of (i) the total monthly revenue of all Creative Subscriptions in effect on the last day of the period, other than domain registrations; (ii) the average revenue per month from domain registrations multiplied by all registered domains in effect on the last day of the period; and (iii) monthly revenue from other partnership agreements including enterprise partners. Under the Board authorized repurchase program, Company securities may be repurchased from time to time using a variety of methods, which may include open market purchases, privately negotiated transactions or otherwise, all in accordance with U.S. securities laws and regulations, including Rule 10b-18 under the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act"). The Company may also, from time to time, enter into plans that are compliant with Rule 10b5-1 of the Exchange Act to facilitate repurchases of its securities under this Board authorization. The repurchase program does not obligate the Company to acquire any particular amount of securities, and the repurchase program may be suspended or discontinued at any time at the Company's discretion. Repurchases under the repurchase program may begin after conclusion of the 30-day period for creditors of the Company to object to the Company's intent to perform the distribution by way of repurchase in accordance with the Israeli Companies Regulations (Relief for Public Companies Whose Securities are Traded on Stock Exchanges Outside of Israel), 5760-2000 and the Israeli Regulations (Approval of Distribution), 5761–2001. The actual timing, number and value of securities repurchased depend on a number of factors, including the market price of the Company's ordinary shares, general market and economic conditions, any objections received by the Company from its creditors, the Company's financial results and liquidity, and other considerations. The Company expects to fund repurchases with cash on hand and future cash generated from its operations. WIX First Quarter 2025 Share Repurchase Program 10
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This document contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include projections regarding our future performance, including, but not limited to revenue, bookings and free cash flow, and may be identified by words like “anticipate,” “assume,” “believe,” “aim,” “forecast,” “indication,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “subject”, “project,” “outlook,” “future,” “will,” “seek” and similar terms or phrases. The forward-looking statements contained in this document, including the quarterly and annual guidance, are based on management’s current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, our ability to attract and retain registered users and partners, and generate new premium subscriptions and additional business solutions as we continuously adjust our marketing strategy and customer care; maintenance of our brand and reputation, and generation of revenue from sources other than premium subscriptions; risks associated with international operations and the use of platform in various countries; risks related to the macroeconomic environment and ongoing global conflicts; security risks and payment risks and fluctuations in foreign currency exchange rates; failures of third-party hardware, software and infrastructure on which we rely, or failure to manage the operation of our infrastructure; adverse market conditions, including inflation, interest rates and other adverse developments that may adversely affect our cash balances and investment portfolio; our history of operating losses and inability to achieve sustained profitability; downturns or upturns in sales are not immediately reflected in full in our operating results; our ability to repurchase our ordinary shares and/or 0.00% Convertible Senior Notes due 2025 pursuant to our repurchase program; our ability to raise capital when needed or on acceptable terms; risks related to acquisitions and investments, pricing decisions, pandemics, natural disasters and other catastrophic events; our ability to develop and introduce new products and services, as well as maintain third-party products and are ability to keep up with rapid changes in design and technology; our ability to attract and retain qualified employees and key personnel; our ability to attract a diversified customer base and increased competition; our ability to maintain compatibility of our platform and solutions with changes in third-party applications and changes to technologies used in our solutions; our ability to acquire and service small business users; risks related to security breaches and unauthorized access to data, cyberattacks; our expectation regarding the uncertain future relationship between the United States and other countries with respect to trade policies, taxes, government regulations, and tariffs; our ability to comply with the regulations applicable to our operations, including new governmental regulations regarding the internet, consumer protection, artificial intelligence (“AI”), privacy and data protection laws and regulations, as well as contractual privacy and data protection obligations; risks relating to intellectual property, including infringements, litigation and claims, and our ability to maintain and protect our intellectual property rights and proprietary information; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; risks related to the development and integration of AI, generative AI, agentic AI, machine learning, and similar tools into our offerings, and comply with the regulatory environment impacting AI and AI-related activities; risks related to activities of registered users or content of their websites, and risks related to domain names and industry regulations; risks related to compliance with laws and regulations, including those related to economic sanctions, tariffs, export controls, anti-corruption and anti-money laundering, anti-trust, and consumer protection, and changes in these laws and regulations; risks related to tax, including application of indirect taxes, tax laws, changes in tax laws or changes in provision for income tax and examination of income tax returns; risks related to ordinary shares, activist shareholders, and our status as a foreign private issuer; risks related to our incorporation and location in Israel, including conflicts in the area; our expectations regarding future changes in our cost of revenues and our operating expenses on an absolute basis and as a percentage of our revenues; our planned level of capital expenditures and our belief that our existing cash and cash from operations will be sufficient to fund our operations for at least the next 12 months and for the foreseeable future; and our ability to enter into new markets and attracting new customer demographics, including our ability to successfully attract new partners and large enterprise-level users and to grow our activities, including through the adoption of our Wix Studio product, with these customer types as anticipated and other factors discussed under the heading “Risk Factors” in the Company’s annual report on Form 20-F for the year ended December 31, 2024 filed with the Securities and Exchange Commission on March 21, 2025. The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. Any forward-looking statement made by us in this press release speaks only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise. Forward-Looking Statements WIX First Quarter 2025 11
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12 Reconciliation of GAAP to Non-GAAP financial measures in 000s 2024 2025 FY FY FY Q1 Q2 Q3 Q4 Q1 2022 2023 2024 Revenues $419,776 $435,7 46 $444,673 $460,455 $473,651 $1,387 ,666 $1,561,665 $1,760,650 Change in deferred revenues $41,319 $25,426 $6,096 $1,609 $44,362 $55,387 $76,193 $7 4,450 Change in unbilled contractual obligations ($3,814) ($2,773) ($989) $2,528 ($7 ,108) $29,066 ($40,355) ($5,048) Bookings $457 ,281 $458,399 $449,780 $464,592 $510,905 $1,472,119 $1,597 ,503 $1,830,052 Creative Subscriptions Revenues $304,293 $312,125 $318,825 $329,732 $337 ,676 $1,039,479 $1,152,007 $1,264,975 Change in deferred revenues $34,158 $19,615 $8,802 ($7 ,057) $38,901 $52,866 $63,124 $55,518 Change in unbilled contractual obligations ($3,814) ($2,773) ($989) $2,528 ($7 ,108) $29,066 ($40,355) ($5,048) Creative Subscriptions Bookings $334,637 $328,967 $326,638 $325,203 $369,469 $1,121,411 $1,17 4,776 $1,315,445 Business Solutions Revenues $115,483 $123,621 $125,848 $130,723 $135,975 $348,187 $409,658 $495,675 Change in deferred revenues $7 ,161 $5,811 ($2,706) $8,666 $5,461 $2,521 $13,069 $18,932 Business Solutions Bookings $122,644 $129,432 $123,142 $139,389 $141,436 $350,708 $422,727 $514,607 Gross Profit $282,479 $294,072 $302,645 $316,819 $321,859 $861,439 $1,049,137 $1,196,015 Share based compensation expenses $3,590 $3,516 $3,57 4 $3,466 $3,320 $17 ,811 $15,013 $14,146 Acquisition related expenses - - - - - $140 $229 - Amortization $667 $668 $667 $667 $667 $2,968 $2,669 $2,669 Non GAAP Gross Profit $286,736 $298,256 $306,886 $320,952 $325,846 $882,358 $1,067 ,048 $1,212,830 Non GAAP Gross margin 68% 68% 69% 70% 69% 64% 68% 69% WIX First Quarter 2025
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13 in 000s 2024 2025 FY FY FY Q1 Q2 Q3 Q4 Q1 2022 2023 2024 Gross Profit - Creative Subscriptions $249,490 $259,086 $265,916 $277 ,061 $281,609 $787 ,892 $936,492 $1,051,553 Share based compensation expenses $2,669 $2,519 $2,562 $2,482 $2,367 $13,933 $11,081 $10,232 Non GAAP Gross Profit - Creative Subscriptions $252,159 $261,605 $268,478 $279,543 $283,976 $801,825 $947 ,573 $1,061,785 Non GAAP Gross margin - Creative Subscriptions 83% 84% 84% 85% 84% 77% 82% 84% Gross Profit - Business Solutions $32,989 $34,986 $36,729 $39,758 $40,250 $73,547 $112,645 $144,462 Share based compensation expenses $921 $997 $1,012 $984 $953 $3,878 $3,932 $3,914 Acquisition related expenses - - - - - $140 $229 - Amortization $667 $668 $667 $667 $667 $2,968 $2,669 $2,669 Non GAAP Gross Profit - Business Solutions $34,577 $36,651 $38,408 $41,409 $41,870 $80,533 $119,475 $151,045 Non GAAP Gross margin - Business Solutions 30% 30% 31% 32% 31% 23% 29% 30% Research and development (GAAP) $124,245 $119,257 $124,593 $127 ,186 $127 ,497 $482,861 $481,293 $495,281 Share Based Compensation $31,102 $30,782 $32,258 $32,320 $31,491 $120,580 $119,482 $126,462 Amortization - - - - - - - - Acquisition related expenses $5 $1 - - - $4,948 $237 $6 Non-GAAP research and development $93,138 $88,47 4 $92,335 $94,866 $96,006 $357 ,333 $361,57 4 $368,813 % of revenue 22% 20% 21% 21% 20% 26% 23% 21% Selling and marketing (GAAP) $107 ,234 $102,498 $109,096 $106,629 $111,563 $492,886 $399,577 $425,457 Share Based Compensation $10,483 $9,206 $9,441 $9,625 $9,177 $38,714 $41,277 $38,755 Amortization $815 $796 $793 $1,166 $804 $3,27 4 $3,282 $3,570 Acquisition related expenses - - - - - - - - Non-GAAP selling and marketing $95,936 $92,496 $98,862 $95,838 $101,582 $450,898 $355,018 $383,132 % of revenue 23% 21% 22% 21% 21% 32% 23% 22% % of Non- GAAP Gross Profit 33% 31% 32% 30% 31% 51% 33% 32% WIX First Quarter 2025
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14 in 000s 2024 2025 FY FY FY Q1 Q2 Q3 Q4 Q1 2022 2023 2024 General and administrative (GAAP) $41,330 $43,712 $43,110 $46,984 $45,394 $171,045 $160,033 $175,136 Share Based Compensation $12,967 $16,382 $15,619 $16,390 $16,273 $59,731 $48,853 $61,358 Amortization $1 $1 $1 $1 $1 $4 $4 $4 Acquisition related expenses - - - - - $39 $6 - Sales tax accrual and other G&A expenses (income) $121 $237 $225 $881 $699 $763 $7 48 $1,464 Non-GAAP general and administrative $28,241 $27 ,092 $27 ,265 $29,712 $28,421 $110,508 $110,422 $112,310 % of revenue 7% 6% 6% 6% 6% 8% 7% 6% GAAP Operating Income (Loss) $9,670 $28,605 $25,846 $36,020 $37 ,405 ($285,353) ($24,380) $100,141 Share Based Compensation $58,142 $59,886 $60,892 $61,801 $60,261 $236,836 $224,625 $240,721 Amortization $1,483 $1,465 $1,461 $1,834 $1,472 $6,246 $5,955 $6,243 Acquisition related expenses $5 $1 - - - $5,127 $472 $6 Sales tax accrual and other G&A expenses (income) $121 $237 $225 $881 $699 $763 $7 48 $1,464 Restructuring - - - - - - $32,614 - Non-GAAP Operating Income (Loss) $69,421 $90,194 $88,424 $100,536 $99,837 ($36,381) $240,034 $348,575 % of revenue 17% 21% 20% 22% 21% -3% 15% 20% Net cash provided (used) by operating activities $113,836 $120,029 $129,814 $133,736 $145,491 $37 ,152 $248,246 $497 ,415 Capital expenditures, net ($8,125) ($7 ,195) ($2,053) ($1,963) ($3,050) ($70,664) ($66,049) ($19,336) Free Cash Flow $105,711 $112,834 $127 ,761 $131,773 $142,441 ($33,512) $182,197 $478,079 Capital expenditures and other cash costs related to Wix HQ office build out $5,362 $4,963 - - - $65,920 $57 ,946 $10,325 Restructuring - - - - - - $5,915 - Free Cash Flow (excluding capex and other cash costs) $111,073 $117 ,797 $127 ,761 $131,773 $142,441 $32,408 $246,058 $488,404 % of revenue 26% 27% 29% 29% 30% 2% 16% 28% Outstanding ordinary shares as year-end 56,305,462 57 ,172,595 56,107 ,932 Outstanding Stock options as year-end 4,332,022 3,956,056 3,165,633 Outstanding Restricted share units as year-end 3,123,019 3,236,7 42 3,385,005 T otal Diluted Shares as of year-end 63,760,503 64,365,393 62,658,570 WIX First Quarter 2025
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15 in 000s 2025 Q1 Bookings $510,905 Adjustment for FX changes $7 ,775 Y /Y Constant Currency Bookings $518,680 Revenues $473,651 Adjustment for FX changes $4,225 Y /Y Constant Currency Revenues $477 ,876 WIX First Quarter 2025