Wix Reports Third Quarter 2022 Results
Wix.com Ltd. (Nasdaq: WIX) reported Q3 2022 revenue of $345.8 million, an 8% year-over-year increase. Notably, constant currency revenue rose to $350.8 million, marking a 10% gain. The company successfully implemented a cost reduction plan, improving gross margins and generating positive non-GAAP net income. Wix forecasts a return to non-GAAP operating income in Q4 2022, with expected free cash flow between $47-50 million. The board has authorized a $300 million share repurchase plan, reinforcing its commitment to shareholder value.
- Q3 2022 total revenue of $345.8 million, up 8% y/y.
- Expected Q4 free cash flow of $47-50 million, the highest in company history.
- Non-GAAP net income of $3.6 million in Q3 2022.
- Cost reduction plan improved operating margins by ~280 bps q/q.
- Total bookings in Q3 2022 were down (6)% y/y.
- Creative subscriptions bookings fell (8)% y/y.
- Total revenue of
$345.8 million up8% y/y, which is$350.8 million and up10% y/y on a constant currency basis - Cost reduction plan drove improved operating leverage – increasing gross margins q/q and generating positive non-GAAP net income and free cash flow in Q3
- Expecting a return to non-GAAP operating income profitability in Q4'22, positioning company to achieve FY23 FCF margin targets as well as full year non-GAAP operating income profitability outlined in three-year plan
NEW YORK, Nov. 10, 2022 /PRNewswire/ -- Wix.com Ltd. (Nasdaq: WIX) today reported financial results for the third quarter ended September 30, 2022. In addition, the Company provided its initial outlook for the fourth quarter. Please visit the Wix Investor Relations website at https://investors.wix.com/ to view the Q3'22 Shareholder Update and other materials.
"Wix continues to be the preferred platform for millions globally. Demand for building, maintaining, and growing an online presence remains healthy, driving strong business fundamentals for Wix this quarter," said Avishai Abrahami, Wix Co-founder and CEO. "As the operating environment remains dynamic and uncertainties persist, we focused on carrying out the cost savings plan introduced last quarter, while continuing to execute on strategic initiatives. Through the team's hard work, profitability improved this quarter while we simultaneously made meaningful strides in product innovation."
Lior Shemesh, CFO at Wix, added, "Revenue came in above expectations this quarter as some stability settled in despite macro headwinds. More importantly, we are already seeing leverage and significant impact from our cost reduction plan, implemented earlier this summer. This resulted in a ~280 bps q/q improvement in non-GAAP operating margin in Q3 and sets us up to generate an anticipated
"Confident in our ability to generate cash flow, our board authorized a
Q3 2022 Financial Results
- Total revenue in the third quarter of 2022 was
$345.8 million , up8% y/y - Total revenue on a y/y constant currency basis was
$350.8 million , up10% y/y - Creative Subscriptions revenue in the third quarter of 2022 was
$261.1 million , up8% y/y - Creative Subscriptions ARR increased to
$1.07 billion , up8% y/y - Business Solutions revenue in the third quarter of 2022 was
$84.7 million , up8% y/y - Transaction revenue [1] was
$36.0 million , up12% y/y - Partners revenue [2] in the third quarter of 2022 was
$86.7 million , up24% y/y - Total bookings in the third quarter of 2022 were
$352.5 million , down (6)% y/y - Total bookings on a y/y constant currency basis were
$366.5 million , down (2)% y/y - Total bookings in Q3'21 were up
33% y/y due to our largest ever B2B partnership, creating a difficult y/y comparison to Q3'22 - Creative Subscriptions bookings in the third quarter of 2022 were
$269.9 million , down (8)% y/y - Business Solutions bookings in the third quarter of 2022 were
$82.5 million , up2% y/y - Total gross margin on a GAAP basis in the third quarter of 2022 was
63% - Creative Subscriptions gross margin on a GAAP basis was
76% - Business Solutions gross margin on a GAAP basis was
22% - Total non-GAAP gross margin in the third quarter of 2022 was
65% - Creative Subscriptions gross margin on a non-GAAP basis was
78% - Business Solutions gross margin on a non-GAAP basis was
24% - GAAP net loss in the third quarter of 2022 was
$(47.4) million , or$(0.81) per share - Non-GAAP net income in the third quarter of 2022 was
$3.6 million , or$0.06 per share - Net cash provided by operating activities for the third quarter of 2022 was
$0.3 million , while capital expenditures totaled$22.9 million , leading to free cash flow of$(22.6) million - Excluding the capex investment associated with our new headquarters office build out, free cash flow for the third quarter of 2022 would have been
$4.6 million
Financial Outlook
Our updated outlook reflects foreign exchange, or FX, rates that have created stronger headwinds to results since we last issued guidance.
For Q4, we expect total revenue to be
For the full year, we now expect revenue to grow
We expect to generate positive non-GAAP operating income and FCF (excluding HQ capex) to meaningfully ramp to
We now expect FCF excluding HQ capex for the full year to be approximately
Changes in FX rates have had a significant impact on our reported results to date and on our expectations for the full year. Assuming y/y constant currency rates as of today:
- Our full year total revenue outlook would be ~
$20 million higher, or 10-11% y/y growth - Our full year total bookings outlook would be ~
$43 million higher - Our full year free cash flow (excluding HQ capex), would be ~
$43 million higher or ~5% of revenue, consistent with the high end of the range provided in May
Conference Call and Webcast Information
Wix will host a conference call to discuss the results at 8:30 a.m. ET on Thursday, November 10, 2022. To participate on the live call, analysts and investors should register and join at https://register.vevent.com/register/BI9cc36ceb99e44521bfb6cfe3f12f8c65. A replay of the call will be available through November 9, 2023 via the registration link.
Wix will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the Company's website at https://investors.wix.com/.
About Wix.com Ltd.
Wix is a leading platform to create, manage and grow a digital presence. What began as a website builder in 2006 is now a complete platform providing users with enterprise-grade performance, security and a reliable infrastructure. Offering a wide range of commerce and business solutions, advanced SEO and marketing tools, Wix enables users to take full ownership of their brand, their data and their relationships with their customers. With a focus on continuous innovation and delivery of new features and products, anyone can build a powerful digital presence to fulfill their dreams on Wix.
For more about Wix, please visit our Press Room
Investor Relations:
ir@wix.com
Media Relations:
pr@wix.com
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, 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 recognised as revenue as we fulfill our obligation under the terms of the contractual agreement. 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 capital expenditures associated with our new 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, as adjusted, cumulative cohort bookings, non-GAAP gross margin, 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 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) all active Creative Subscriptions in effect on the last day of the period, multiplied by the monthly revenue of such Creative Subscriptions, other than domain registrations in effect on the last day of the period; (ii) the average revenue per month from domain registrations; (iii) monthly revenue from other partnership agreements.
Forward-Looking Statements
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," "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 expectation that we will be able to attract and retain registered users and generate new premium subscriptions; our expectation that we will be able to increase the revenue we derive from the sale of premium subscriptions and business solutions, through our partners; our expectation that new products and developments, as well as third-party products we will offer in the future within our platform, will receive customer acceptance and satisfaction, including the growth in market adoption of our online commerce solutions; our assumption that historical user behavior can be extrapolated to predict future user behavior; our expectations regarding execution of our multi-year strategic plan and cost reduction plan; our prediction of the future revenues generated by our user cohorts and our ability to maintain and increase such revenue growth; our expectation to maintain and enhance our brand and reputation; and thereby increase user retention, user engagement and sales; our expectation that our products created for markets outside of North America will continue to generate growth in those markets; our plans to successfully localize our products, including by making our product, support and communication channels available in additional languages and to expand our payment infrastructure to transact in additional local currencies and accept additional payment methods; our expectations regarding the extent of the impact on our business and operations of the COVID-19 pandemic, including uncertainty relating to expected consumer dynamics after the COVID-19 pandemic subsides, the effectiveness of government policies, vaccine administration rates and other factors; our expectation regarding the impact of fluctuations in foreign currency exchange rates on our business; our expectations relating to the repurchase of our ordinary shares and/or Convertible Notes pursuant to our repurchase program; our expectation that we will effectively manage the growth of our infrastructure; changes we expect may occur to technologies used in our solutions; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; 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, as well as our ability to achieve profitability; our expectations regarding changes in the global, national, regional or local economic, business, competitive, market, and regulatory landscape, including as a result of increasing interest rates and inflationary pressures, lasting effects of COVID-19, and as a result of the military invasion of Ukraine by Russia; 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; our expectations with respect to the integration and performance of acquisitions; our ability to attract and retain qualified employees and key personnel; our expectations about entering into new markets and attracting new customer demographics, including our ability to successfully attract new partners and grow our partner activities 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, 2021 filed with the Securities and Exchange Commission on April 1, 2022. 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.
Wix.com Ltd. | |||||||
CONSOLIDATED STATEMENTS OF OPERATIONS - GAAP | |||||||
(In thousands, except loss per share data) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Revenues | |||||||
Creative Subscriptions | $ 261,066 | $ 241,303 | $ 774,211 | $ 703,630 | |||
Business Solutions | 84,739 | 78,587 | 258,415 | 232,614 | |||
345,805 | 319,890 | 1,032,626 | 936,244 | ||||
Cost of Revenues | |||||||
Creative Subscriptions | 62,035 | 57,813 | 193,160 | 171,830 | |||
Business Solutions | 65,822 | 64,163 | 204,303 | 184,857 | |||
127,857 | 121,976 | 397,463 | 356,687 | ||||
Gross Profit | 217,948 | 197,914 | 635,163 | 579,557 | |||
Operating expenses: | |||||||
Research and development | 120,384 | 109,323 | 361,867 | 308,608 | |||
Selling and marketing | 117,448 | 119,991 | 394,942 | 387,467 | |||
General and administrative | 42,427 | 38,917 | 131,104 | 112,722 | |||
Total operating expenses | 280,259 | 268,231 | 887,913 | 808,797 | |||
Operating loss | (62,311) | (70,317) | (252,750) | (229,240) | |||
Financial income (expenses), net | 21,142 | 111,917 | (170,257) | 288,811 | |||
Other income | 131 | 87 | 235 | 193 | |||
Income (loss) before taxes on income | (41,038) | 41,687 | (422,772) | 59,764 | |||
Taxes on income (tax benefit) | 6,323 | 25,374 | (36,884) | 67,932 | |||
Net income (loss) | $ (47,361) | $ 16,313 | $ (385,888) | $ (8,168) | |||
Basic net income (loss) per share | $ (0.81) | $ 0.28 | $ (6.66) | $ (0.14) | |||
Basic weighted-average shares used to compute net income (loss) per share | 58,355,542 | 57,313,747 | 57,930,336 | 56,970,641 | |||
Diluted net income (loss) per share | $ (0.81) | $ 0.27 | $ (6.66) | $ (0.14) | |||
Diluted weighted-average shares used to compute net income (loss) per share | 58,355,542 | 60,549,853 | 57,930,336 | 56,970,641 | |||
Wix.com Ltd. | |||
CONDENSED CONSOLIDATED BALANCE SHEETS | |||
(In thousands) | |||
September 30, | December 31, | ||
2022 | 2021 | ||
Assets | (unaudited) | (audited) | |
Current Assets: | |||
Cash and cash equivalents | $ 299,940 | $ 451,355 | |
Short-term deposits | 516,770 | 411,687 | |
Restricted deposits | 13,644 | 7,012 | |
Marketable securities | 400,084 | 456,515 | |
Trade receivables | 35,796 | 30,367 | |
Prepaid expenses and other current assets | 40,769 | 32,877 | |
Total current assets | 1,307,003 | 1,389,813 | |
Long-Term Assets: | |||
Prepaid expenses and other long-term assets | 33,476 | 41,554 | |
Property and equipment, net | 72,637 | 50,437 | |
Marketable securities | 235,997 | 387,341 | |
Intangible assets and goodwill, net | 84,804 | 89,547 | |
Operating lease right-of-use assets | 235,794 | 101,095 | |
Total long-term assets | 662,708 | 669,974 | |
Total assets | $ 1,969,711 | $ 2,059,787 | |
Liabilities and Shareholders' Equity (deficiency) | |||
Current Liabilities: | |||
Trade payables | $ 118,788 | $ 114,584 | |
Employees and payroll accruals | 68,145 | 83,251 | |
Deferred revenues | 526,764 | 484,446 | |
Current portion of convertible notes, net | 361,100 | - | |
Accrued expenses and other current liabilities | 86,226 | 62,816 | |
Operating lease liabilities | 29,294 | 29,201 | |
Total current liabilities | 1,190,317 | 774,298 | |
Long Term Liabilities: | |||
Long-term deferred revenues | 68,954 | 59,966 | |
Long-term deferred tax liability | 26,856 | 72,803 | |
Convertible notes, net | 565,782 | 922,974 | |
Other long-term liabilities | 1,991 | 2,267 | |
Long-term operating lease liabilities | 180,227 | 81,764 | |
Total long-term liabilities | 843,810 | 1,139,774 | |
Total liabilities | 2,034,127 | 1,914,072 | |
Shareholders' Equity (deficiency) | |||
Ordinary shares | 115 | 111 | |
Additional paid-in capital | 1,214,441 | 994,795 | |
Treasury Stock | (199,997) | (199,997) | |
Accumulated other comprehensive income | (44,949) | (1,056) | |
Accumulated deficit | (1,034,026) | (648,138) | |
Total shareholders' equity (deficiency) | (64,416) | 145,715 | |
Total liabilities and shareholders' equity | $ 1,969,711 | $ 2,059,787 | |
Wix.com Ltd. | |||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
OPERATING ACTIVITIES: | |||||||
Net income (loss) | $ (47,361) | $ 16,313 | $ (8,168) | ||||
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | |||||||
Depreciation | 3,845 | 3,595 | 11,402 | 10,405 | |||
Amortization | 1,581 | 3,045 | 4,735 | 4,490 | |||
Share based compensation expenses | 56,796 | 53,070 | 176,919 | 150,097 | |||
Amortization of debt discount and debt issuance costs | 1,305 | 1,297 | 3,908 | 4,000 | |||
Changes in accrued interest and exchange rate on short term and long term deposits | 172 | (57) | 7 | (105) | |||
Amortization of premium and discount and accrued interest on marketable securities, net | 1,000 | 1,796 | 3,805 | 6,201 | |||
Remeasurement loss (gain) on Marketable equity | (10,182) | (110,855) | 196,383 | (184,041) | |||
Deferred income taxes, net | 2,351 | 21,111 | (45,868) | 61,214 | |||
Changes in operating lease right-of-use assets | 8,141 | 5,907 | 26,716 | 18,967 | |||
Changes in operating lease liabilities | (8,675) | (6,062) | (33,847) | (19,675) | |||
Decrease (increase) in trade receivables | 5,004 | 1,430 | (5,429) | (3,871) | |||
Increase in prepaid expenses and other current and long-term assets | (5,280) | (652) | (32,625) | (101,497) | |||
Increase (decrease) in trade payables | (7,960) | 6,727 | 4,153 | 5,699 | |||
Increase (decrease) in employees and payroll accruals | (9,562) | (628) | (14,644) | 12,519 | |||
Increase in short term and long term deferred revenues | 6,023 | 6,243 | 51,306 | 75,839 | |||
Increase in accrued expenses and other current liabilities | 3,069 | 2,043 | 22,885 | 12,570 | |||
Net cash provided by (used in) operating activities | 267 | 4,323 | (16,082) | 44,644 | |||
INVESTING ACTIVITIES: | |||||||
Proceeds from short-term deposits and restricted deposits | 105,171 | 269,000 | 336,430 | 447,015 | |||
Investment in short-term deposits and restricted deposits | (57,180) | (245,000) | (448,152) | (417,131) | |||
Investment in marketable securities | (38,048) | - | (202,611) | - | |||
Proceeds from marketable securities | 51,619 | 80,909 | 191,869 | 261,568 | |||
Purchase of property and equipment and payment of prepaid expenses | (22,208) | (12,604) | (54,120) | (22,981) | |||
Capitalization of internal use of software | (666) | (426) | (1,895) | (1,017) | |||
Investment in other long-term assets | (580) | - | (580) | - | |||
Proceeds from equity securities | - | 18,771 | 3,193 | 18,771 | |||
Payment for Businesses acquired, net of acquired cash | - | 189 | - | (42,614) | |||
Purchases of investments in privately held companies | (100) | (2,000) | (1,260) | (3,500) | |||
Net cash provided by (used in) investing activities | 38,008 | 108,839 | (177,126) | 240,111 | |||
FINANCING ACTIVITIES: | |||||||
Proceeds from exercise of options and ESPP shares | 19,779 | 11,752 | 41,793 | 33,554 | |||
Purchase of treasury stock | - | (200,000) | - | (200,000) | |||
Net cash provided by financing activities | 19,779 | (188,248) | 41,793 | (166,446) | |||
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 58,054 | (75,086) | (151,415) | 118,309 | |||
CASH AND CASH EQUIVALENTS—Beginning of period | 241,886 | 362,253 | 451,355 | 168,858 | |||
CASH AND CASH EQUIVALENTS—End of period | $ 299,940 | $ 287,167 | $ 299,940 | $ 287,167 | |||
Wix.com Ltd. | |||||||
KEY PERFORMANCE METRICS | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Creative Subscriptions | 261,066 | 241,303 | 774,211 | 703,630 | |||
Business Solutions | 84,739 | 78,587 | 258,415 | 232,614 | |||
Total Revenues | $ 345,805 | $ 319,890 | $ 1,032,626 | $ 936,244 | |||
Creative Subscriptions | 269,937 | 292,737 | 839,645 | 823,841 | |||
Business Solutions | 82,527 | 80,560 | 260,661 | 243,426 | |||
Total Bookings | $ 352,464 | $ 373,297 | $ 1,100,306 | $ 1,067,267 | |||
Free Cash Flow | $ (22,607) | $ (8,707) | $ (72,097) | $ 20,646 | |||
Free Cash Flow, excluding capex related to future Wix HQ office build-out | $ 4,559 | $ 1,663 | $ (19,582) | $ 34,048 | |||
Creative Subscriptions ARR | $ 1,071,045 | $ 992,295 | $ 1,071,045 | $ 992,295 | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF REVENUES TO BOOKINGS | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Revenues | $ 345,805 | $ 319,890 | $ 1,032,626 | $ 936,244 | |||
Change in deferred revenues | 6,023 | 6,243 | 51,306 | 75,839 | |||
Change in unbilled contractual obligations | 636 | 47,164 | 16,374 | 55,184 | |||
Bookings | $ 352,464 | $ 373,297 | $ 1,100,306 | $ 1,067,267 | |||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Creative Subscriptions Revenues | $ 261,066 | $ 241,303 | $ 774,211 | $ 703,630 | |||
Change in deferred revenues | 8,235 | 4,270 | 49,060 | 65,027 | |||
Change in unbilled contractual obligations | 636 | 47,164 | 16,374 | 55,184 | |||
Creative Subscriptions Bookings | $ 269,937 | $ 292,737 | $ 839,645 | $ 823,841 | |||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Business Solutions Revenues | $ 84,739 | $ 78,587 | $ 258,415 | $ 232,614 | |||
Change in deferred revenues | (2,212) | 1,973 | 2,246 | 10,812 | |||
Business Solutions Bookings | $ 82,527 | $ 80,560 | $ 260,661 | $ 243,426 | |||
Wix.com Ltd. | |||
RECONCILIATION OF COHORT BOOKINGS | |||
(In millions) | |||
Nine Months Ended | |||
September 30, | |||
2022 | 2021 | ||
(unaudited) | |||
Q1 Cohort revenues | $ 29 | $ 39 | |
Q1 Change in deferred revenues | 18 | 21 | |
Q1 Cohort Bookings | $ 47 | $ 60 | |
Wix.com Ltd. | |||
RECONCILIATION OF REVENUES AND BOOKINGS EXCLUDING FX IMPACT | |||
(In thousands) | |||
Three Months Ended | |||
September 30, | |||
2022 | 2021 | ||
(unaudited) | |||
Revenues | $ 345,805 | $ 319,890 | |
FX impact on Q3/22 using Q3/21 rates | 4,983 | - | |
Revenues excluding FX impact | $ 350,788 | $ 319,890 | |
Three Months Ended | |||
September 30, | |||
2022 | 2021 | ||
(unaudited) | |||
Bookings | $ 352,464 | $ 373,297 | |
FX impact on Q3/22 using Q3/21 rates | 14,073 | - | |
Bookings excluding FX impact | $ 366,537 | $ 373,297 | |
Wix.com Ltd. | |||||||
TOTAL ADJUSTMENTS GAAP TO NON-GAAP | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(1) Share based compensation expenses: | (unaudited) | (unaudited) | |||||
Cost of revenues | $ 4,418 | $ 4,057 | $ 13,204 | $ 11,367 | |||
Research and development | 29,606 | 26,250 | 88,245 | 74,028 | |||
Selling and marketing | 9,261 | 8,715 | 29,155 | 24,370 | |||
General and administrative | 13,511 | 14,048 | 46,315 | 40,332 | |||
Total share based compensation expenses | 56,796 | 53,070 | 176,919 | 150,097 | |||
(2) Amortization | 1,581 | 3,045 | 4,735 | 4,490 | |||
(3) Acquisition related expenses | 585 | 2,579 | 3,471 | 6,635 | |||
(4) Amortization of debt discount and debt issuance costs | 1,305 | 1,297 | 3,908 | 4,000 | |||
(5) Sales tax accrual and other G&A expenses (income) | 183 | 341 | 544 | 1,372 | |||
(6) Unrealized loss (gain) on equity and other investments | (10,182) | (112,165) | 196,383 | (284,026) | |||
(7) Non-operating foreign exchange expenses (income) | (1,675) | 1,745 | 183 | 4,698 | |||
(8) Provision for income tax effects related to non-GAAP adjustments | 2,342 | 21,480 | (45,902) | 61,008 | |||
Total adjustments of GAAP to Non GAAP | $ 50,935 | $ (28,608) | $ 340,241 | $ (51,726) | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Gross Profit | $ 217,948 | $ 197,914 | $ 635,163 | $ 579,557 | |||
Share based compensation expenses | 4,418 | 4,057 | 13,204 | 11,367 | |||
Acquisition related expenses | - | 108 | 140 | 387 | |||
Amortization | 759 | 930 | 2,279 | 1,385 | |||
Non GAAP Gross Profit | 223,125 | 203,009 | 650,786 | 592,696 | |||
Non GAAP Gross margin | 65 % | 63 % | 63 % | 63 % | |||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Gross Profit - Creative Subscriptions | $ 199,031 | $ 183,490 | $ 581,051 | $ 531,800 | |||
Share based compensation expenses | 3,503 | 2,947 | 10,496 | 8,420 | |||
Non GAAP Gross Profit - Creative Subscriptions | 202,534 | 186,437 | 591,547 | 540,220 | |||
Non GAAP Gross margin - Creative Subscriptions | 78 % | 77 % | 76 % | 77 % | |||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Gross Profit - Business Solutions | $ 18,917 | $ 14,424 | $ 54,112 | $ 47,757 | |||
Share based compensation expenses | 915 | 1,110 | 2,708 | 2,947 | |||
Acquisition related expenses | - | 108 | 140 | 387 | |||
Amortization | 759 | 930 | 2,279 | 1,385 | |||
Non GAAP Gross Profit - Business Solutions | 20,591 | 16,572 | 59,239 | 52,476 | |||
Non GAAP Gross margin - Business Solutions | 24 % | 21 % | 23 % | 23 % | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF OPERATING LOSS TO NON-GAAP OPERATING LOSS | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Operating loss | $ (62,311) | $ (70,317) | $ (252,750) | $ (229,240) | |||
Adjustments: | |||||||
Share based compensation expenses | 56,796 | 53,070 | 176,919 | 150,097 | |||
Amortization | 1,581 | 3,045 | 4,735 | 4,490 | |||
Sales tax accrual and other G&A expenses | 183 | 341 | 544 | 1,372 | |||
Acquisition related expenses | 585 | 2,579 | 3,471 | 6,635 | |||
Total adjustments | $ 59,145 | $ 59,035 | $ 185,669 | $ 162,594 | |||
Non GAAP operating loss | $ (3,166) | $ (11,282) | $ (67,081) | $ (66,646) | |||
Non GAAP operating margin | -1 % | -4 % | -6 % | -7 % | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP NET LOSS AND NON-GAAP NET LOSS PER SHARE | |||||||
(In thousands, except per share data) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Net income (loss) | $ (47,361) | $ 16,313 | $ (385,888) | $ (8,168) | |||
Share based compensation expenses and other Non GAAP adjustments | 50,935 | (28,608) | 340,241 | (51,726) | |||
Non-GAAP net income (loss) | $ 3,574 | $ (12,295) | $ (45,647) | $ (59,894) | |||
Basic and diluted Non GAAP net income (loss) per share | $ 0.06 | $ (0.21) | $ (0.79) | $ (1.05) | |||
Weighted average shares used in computing basic and diluted Non GAAP net income (loss) per share | 58,355,542 | 57,313,747 | 57,930,336 | 56,970,641 | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES TO FREE CASH FLOW | |||||||
(In thousands) | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Net cash provided by (used in) operating activities | $ 267 | $ 4,323 | $ (16,082) | $ 44,644 | |||
Capital expenditures, net | (22,874) | (13,030) | (56,015) | (23,998) | |||
Free Cash Flow | $ (22,607) | $ (8,707) | $ (72,097) | $ 20,646 | |||
Capex related to future Wix HQ office build-out | 27,166 | 10,370 | 52,515 | 13,402 | |||
Free Cash Flow, excluding capex related to future Wix HQ office build-out | $ 4,559 | $ 1,663 | $ (19,582) | $ 34,048 | |||
Wix.com Ltd. | |||||||
RECONCILIATION OF BASIC WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING AND THE DILUTED WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING | |||||||
Three Months Ended | Nine Months Ended | ||||||
September 30, | September 30, | ||||||
2022 | 2021 | 2022 | 2021 | ||||
(unaudited) | (unaudited) | ||||||
Basic weighted-average shares used to compute net income (loss) per share | 58,355,542 | 57,313,747 | 57,930,336 | 56,970,641 | |||
Effect of dilutive securities (included in the effect of dilutive securities is the assumed conversion of employee stock options, employee RSUs and the Notes) | - | 3,236,106 | - | - | |||
Diluted weighted-average shares used to compute net income (loss) per share | 58,355,542 | 60,549,853 | 57,930,336 | 56,970,641 | |||
The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: | |||||||
Stock options | 4,964,207 | 672,240 | 4,964,207 | 4,699,390 | |||
Restricted share units | 2,901,755 | 675,134 | 2,901,755 | 1,921,287 | |||
Convertible Notes (if-converted) | 3,969,514 | 3,969,514 | 3,969,514 | 3,969,514 | |||
70,191,018 | 65,866,741 | 69,765,812 | 67,560,832 | ||||
[1] 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.
[2] Partners revenue is defined as revenue generated through agencies and freelancers that build sites or applications for other users as well as revenue generated through B2B partnerships, such as LegalZoom or Vistaprint. We identify agencies and freelancers building sites or applications for others 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, among other criteria. Partners revenue includes revenue from both the Creative Subscriptions and Business Solutions segments.
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SOURCE Wix.com Ltd.
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