OREANDA-NEWS. Wix.com Ltd., a leading global software platform for small businesses operating online, today reported stronger than expected financial results for the second quarter ended June 30, 2016.  In addition, the Company provided its initial outlook for the third quarter 2016 and once again raised its financial outlook for the full year 2016. 

“The incredible momentum in our business continued during the second quarter as we generated record growth in net premium subscriptions,” said Avishai Abrahami, Co-founder and CEO of Wix. “We continue to generate an exceptional blend of higher conversion of registered users to premium subscriptions, improved retention of subscriptions, and increased collections per new subscription.  We also raised the bar for website design with the introduction of Wix Artificial Design Intelligence, or Wix ADI. The initial response to this ground breaking product has been overwhelmingly positive, and executing on the first AI solution for design widens our technology leadership moat.”

Lior Shemesh, CFO of Wix, commented, “Our outperformance this quarter was our strongest as a public company and continues a consistent trend of delivering higher than expected financial results. We re-accelerated our top line growth rate and generated record free cash flow.  Our existing user cohorts continue to generate significant value, stemming from the ongoing conversion of existing registered users and the negative churn we highlighted at our analyst day in June. Our performance in the first half of 2016 was well ahead of our expectations going into the year, and with new product introductions and improvements on the horizon, we are excited about the second half of the year. As a result, we are once again increasing our full year outlook for all of our key financial metrics.”

Q2 2016 Results and Highlights

  • Revenue increased 41% to $68.7 million compared to $48.6 million for the second quarter last year 
  • Collections on a constant currency basis, which excludes the impact of approximately$1 million related to year-over-year changes in foreign exchange rates, would have been$82.5 million, an increase of 44% versus the prior year
    • Reported collections increased 42% to $81.5 million compared to $57.4 million for the second quarter last year
  • Gross margin on a GAAP basis was 84% compared to 83% in the second quarter of last year. Non-GAAP gross profit was 86% of collections compared to 85% in the second quarter of last year
  • GAAP operating loss was $10.5 million compared to $10.8 million in the second quarter a year ago. On a non-GAAP basis, operating losses were $3.0 million compared to $6.8 million in the second quarter last year
  • GAAP net loss was $11.4 million, or $(0.28) per share, compared to a net loss of $12.3 million, or $(0.31) per share for the second quarter of 2015
  • Non-GAAP net loss was $3.7 million, or $(0.09) per share, compared to a non-GAAP net loss of $8.2 million, or $(0.21) per share for the second quarter of 2015
  • Adjusted EBITDA was $10.7 million compared to $3.5 million for the second quarter of 2015
  • Free cash flow improved to $10.2 million compared to $3.4 million for the second quarter of 2015
  • Added a record 183,000 net premium subscriptions in the period to reach 2.12 million as of June 30, 2016, a 41% increase over the second quarter of 2015
  • Added 5.1 million registered users in the second quarter. Registered users as of June 30, 2016 were 87 million, representing a 29% increase compared to the second quarter of 2015

Recent Business Highlights

  • Launched Wix ADI:  Wix unveiled the first-ever AI solution for design and creation for desktop and mobile websites worldwide. Wix ADI was designed to eliminate the most significant challenges of building websites – time, design and content creation. Wix ADI instantly produces tailored websites by learning about the user through a few simple questions and curates content to create a unique design. From billions of high-quality combinations and possibilities, Wix ADI selects the perfect combination for each users' need.
     
  • Wix Mobile Growth:  Our users have created over 17.9 million mobile sites using our platform to date, making Wix one of the largest mobile site development platforms globally.
     
  • Global E-commerce Platform: E-commerce subscriptions surpassed 290,000 during the quarter.
     
  • Increasing Platform Engagement:  Continued engagement with the Wix ecosystem illustrated by over 355 million contacts saved onto the Wix platform.  Leveraging Wix’s MyAccount CRM system, business owners track customer activity data, manage relationships and communicate using WixShoutOut, Wix’s email marketing solution.