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On Thu, 20 Feb, 8:06 AM UTC
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Wix Achieves "Rule of 40" Early: 5 Key Takeaways From Q4 2024 Earnings | The Motley Fool
Wix.com (WIX -2.25%) reported fourth-quarter and full-year 2024 results on February 19, 2025, showcasing significant growth and operational improvements. The company hit its "rule of 40" target (where the revenue growth percentage plus free cash flow margin exceeds 40%) a year ahead of schedule and is now setting its sights even higher for 2025. Wix has successfully balanced aggressive growth with improved profitability, reaching its ambitious benchmark ahead of time. In 2022, we set out an ambitious plan to achieve rule of 40 by 2025. I am excited to announce that not only have we now achieved the rule of 40 milestone, but the tremendous commitment and execution of our team allowed us to reach this target a full year ahead of our goal. -- Avishai Abrahami, CEO and co-founder Bookings grew 15% in 2024 (accelerating to 18% in Q4), while non-GAAP operating margins expanded to 20% of revenue, up 450 basis points from 2023. Free cash flow nearly doubled to $488 million (28% of revenue). For 2025, Wix is targeting the more ambitious "rule of 45," demonstrating confidence in continuing this balanced approach to growth and profitability. The professional partner segment has emerged as Wix's fastest-growing revenue source, powered by strong adoption of its Studio platform. Partner's revenue grew a lofty 30% year over year. We now have over 2 million Studio accounts that represent a vibrant community of creative professionals with over 75% of these accounts created by partners new to Wix. -- Avishai Abrahami, CEO and co-founder Launched in October 2023, Studio has quickly become the go-to solution for web professionals and agencies, now accounting for approximately 50% of new purchases. By streamlining the website creation process and eliminating the need for separate design and coding specialists, Studio enables partners to deliver better results more efficiently, driving both adoption and loyalty. Wix's AI strategy is yielding tangible benefits in user conversion while opening new monetization opportunities. The new AI website builder is the linchpin in our suite of AI products and is revolutionizing web creation. Available to all users today, over 1 million sites have been created and published with the website builder. As I discussed last quarter, the AI website builder continues to drive demonstrably stronger conversion and purchase behavior as well. -- Avishai Abrahami, CEO and co-founder The company's AI website builder is improving free-to-paid conversion rates, particularly for self-creators. In December 2024, Wix launched its first monetized AI product, AI Site Check, providing 24/7 AI chat capabilities for businesses. The company is now developing an AI assistant for its business dashboard and an AI marketing agent that analyzes website data to generate tailored marketing plans, expanding its AI monetization opportunities. Wix's strategic shift to targeting higher-intent users is resulting in better cohort economics and lifetime value. Our Q1 2024 user cohort generated approximately $61 million in cumulative bookings through its first four quarters. This is only second to the Q1 2021 cohort, which benefited significantly from COVID tailwinds. Recent performance was particularly impressive given the smaller user base of the Q1 2024 cohort. -- Nir Zohar, President and COO Average bookings per subscription increased 13% year-over-year to more than $294, driven by higher-tiered packages and increased business solutions adoption. The company now expects existing user cohorts to generate $18.4 billion in bookings over the next 10 years, up significantly from the $16.2 billion estimated last year. Net revenue retention also improved to 100% in 2024, further validating the company's focus on quality over quantity. After focusing on its partner strategy in 2024, Wix is turning attention to accelerating its self-creator segment through significant product launches. We have two major products that I believe will change how self-creators build and grow online. The first will be a new solution that expands powerful design capabilities beyond just websites. We expect this to launch around spring. The second will be a transformative new way for self-creators to build their presence on the internet. This is planned for launch in the early fall. -- Avishai Abrahami, CEO and co-founder While not included in current 2025 guidance, management believes these new products will drive double-digit growth in the self-creator business by 2026. The first product will expand design capabilities to formats like social media content, while the second represents a "transformative" approach to online presence building. These initiatives demonstrate Wix's commitment to innovation across both its self-creator and professional segments. Wix enters 2025 with strong momentum across its partner and self-creator businesses. With continued acceleration in partner revenue (up 30% year over year), improving self-creator growth, and proven AI-driven conversion benefits, the company is well positioned to achieve its "rule of 45" target. Management is focusing on expanding design capabilities, transforming the self-creator experience, evolving Studio for professionals, and monetizing AI across the platform. As CFO Lior Shemesh stated: "The high end of our revenue and free cash flow expectations positions Wix to achieve rule of 45 in 2025, a new milestone target that underscores our relentless focus on driving both growth and profitability improvements on top of the incredible progress made in recent years."
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Wix.com: Q4 EPS Tops Estimates | The Motley Fool
Wix.com reported a strong earnings beat for the fourth quarter of 2024, despite narrowly missing revenue expectations. Cloud-based web development platform specialist Wix.com (WIX 1.82%) reported mixed fourth-quarter 2024 earnings on Wednesday, Feb. 19. Adjusted EPS of $1.93 easily beat the consensus analyst estimate of $1.59, but Q4 revenue of $460.5 million fell just shy of the $461 million forecast. Overall, the quarterly performance was strong, with the company showcasing a robust 14% year-over-year jump in revenue. Source: Wix.com. Note: Analyst consensus estimates for the quarter provided by FactSet. YOY = Year over year. Wix.com is a prominent cloud-based web development platform that empowers individuals and businesses to create stunning websites. The company provides a range of services from basic site building to complex application design through tools like Wix Editor and Wix ADI (Artificial Design Intelligence). Recently, its focus has been on leveraging AI for product enhancements, expanding its international market footprint, and scaling its partner and ecosystem networks. Success for Wix hinges on user base expansion, product diversification, and continuous technological innovation. Wix has strategically diversified its offerings, integrating AI-driven solutions like AI-powered Website Builder to improve user engagement and conversion rates. Its growth is also underpinned by international market expansion, ensuring a diversified revenue stream beyond the U.S., and robust development of its partner ecosystem, which showed a strong 30% year-over-year growth in 2024. This quarter, Wix.com showed resilience amid slight revenue forecast misses. Free cash flow stood out this quarter at $131.8 million, a sharp increase from Q4 2023's $80.4 million. The jump highlights the company's efficient operational capabilities. Gross margin improved by 1 percentage point to 70% from 69% a year ago, reflecting ongoing efforts to improve cost management. Notable developments include advancements in international market penetration, with 40% of revenue now being generated from non-U.S. currencies. Through strategic initiatives, such as its AI solutions and the Partner segment, which grew 30% for the full year 2024, Wix continues to enhance its business model. Wix experienced considerable growth in registered users, totaling over 282 million by year-end, with premium subscriptions reaching 6.2 million. This aligns with its strategy to convert free users to paying subscribers, bolstering revenue. Additionally, Q4 sales from its Business Solutions segment advanced 21% year over year, contributing to an 18% increase in total bookings of $464.6 million. Wix completed a $200 million share repurchase plan in January that brought the total buybacks since August 2023 to $725 million. More buybacks are expected in 2025. Wix management said it sees first-quarter 2025 revenue coming in at $469 million to $473 million. For the full year 2025, it projects revenue to total between $1.97 billion to $2.0 billion, representing a 12% to 14% increase. Bookings are anticipated at $2.025 billion to $2.06 billion, marking continued strength with an 11% to 13% growth outlook. Management is optimistic about margin expansion fueled by the continued adoption of AI tools and Studio's growth trajectory. Investors should pay attention to the impact of foreign exchange rates, which may continue affecting revenue. Additionally, AI products and enhancements could drive significant transformation and monetization, supporting growth into the next fiscal year. As Wix continues to develop its ecosystem and geographical presence, these strategic focuses promise further expansion opportunities.
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Wix Q4 Earnings: EPS Beat, Issues Strong 2025 Outlook With Two Products Launch - Wix.com (NASDAQ:WIX)
On Wednesday, SaaS website builder platform Wix.com Ltd WIX reported its fiscal fourth-quarter 2024 results. Revenue grew 14% year over year to $460.46 million, marginally missing the analyst consensus estimate of $461.75 million. Adjusted EPS of $1.93 beat the analyst consensus estimate of $1.59. Also Read: Baidu Q4 Earnings: AI Cloud Grows, Margin Slides, Expects AI Investments To Bear Fruit In 2025 Creative Subscription revenue increased 11% Y/Y to $329.7 million. The Creative Subscriptions bookings climbed 15% Y/Y to $325.2 million. Creative Subscriptions ARR was $1.34 billion, up 13% Y/Y. Partners revenue in the quarter was $168.1 million, up 29% Y/Y. Business Solutions' revenue rose 21% Y/Y to $130.7 million, and bookings jumped 25% Y/Y to $139.4 million. The adjusted gross margin remained firm at 70%. As of December end, Wix.com generated $133.74 million in operating cash flow and held $999.53 million in cash and equivalents. Co-founder and CEO Avishai Abrahami said 2024 was one of the exciting innovations as Wix introduced revolutionary AI solutions such as the new generation AI Website Builder. Wix also made meaningful enhancements to the Studio platform, including the AI visual sitemap, wireframe generator, and Figma integration. The year 2025 is poised to reimagine and expand the Self Creator experience by launching two transformative products planned for the spring and early fall. Outlook: Wix.com expects fiscal 2025 revenue of $1.970 billion -- $2.000 billion vs. the consensus of $2.018 billion. Wix.com projects 2025 bookings of $2.025 billion -- $2.060 billion. The company expects to generate free cash flow, excluding headquarters costs, of $590 million -- $610 million. Wix.com expects first-quarter fiscal 2025 revenue of $469 million -- $473 million versus a consensus of $481.47 million. Wix.Com stock surged 82% in the last 12 months. Raymond James' Josh Beck and JMP Securities' Andrew Boone noted Wix is gaining market share and will likely continue doing so through 2025, backed by Studio product improvements and potential benefits from the lawsuit and negative headlines surrounding rival WordPress. Price Action: WIX stock traded higher by 6.51% at $242.60 premarket last check Wednesday. Also Read: Robinhood To Expands Crypto Offerings In Singapore In Push For Global Growth WIXWix.com Ltd$238.004.49%WatchlistOverviewMarket News and Data brought to you by Benzinga APIs
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Wix.com reports strong Q4 2024 earnings, achieving its "Rule of 40" goal a year early, driven by AI innovations and strategic focus on high-intent users. The company announces plans for transformative product launches in 2025.
Wix.com, a leading cloud-based web development platform, has reported impressive fourth-quarter and full-year 2024 results, surpassing its financial targets and setting new benchmarks for growth and profitability. The company achieved its "Rule of 40" goal (where revenue growth percentage plus free cash flow margin exceeds 40%) a full year ahead of schedule, demonstrating strong execution and operational efficiency 1.
CEO and co-founder Avishai Abrahami stated, "I am excited to announce that not only have we now achieved the rule of 40 milestone, but the tremendous commitment and execution of our team allowed us to reach this target a full year ahead of our goal" 1.
Wix reported a 14% year-over-year increase in revenue to $460.5 million for Q4 2024, slightly missing analyst expectations of $461 million. However, the company's adjusted earnings per share (EPS) of $1.93 significantly outperformed the consensus estimate of $1.59 2.
Key financial highlights include:
Wix's strategic focus on AI-powered solutions has been a key driver of its success. The company's AI website builder has significantly improved free-to-paid conversion rates, particularly for self-creators. Over 1 million sites have been created and published using this tool 1.
In December 2024, Wix launched its first monetized AI product, AI Site Check, providing 24/7 AI chat capabilities for businesses. The company is also developing an AI assistant for its business dashboard and an AI marketing agent to generate tailored marketing plans 1.
The professional partner segment has emerged as Wix's fastest-growing revenue source, with a 30% year-over-year increase. The Studio platform, launched in October 2023, has quickly become the preferred solution for web professionals and agencies, now accounting for approximately 50% of new purchases 1.
Wix's strategic shift to targeting higher-intent users has resulted in better cohort economics and lifetime value. The Q1 2024 user cohort generated approximately $61 million in cumulative bookings through its first four quarters, second only to the COVID-boosted Q1 2021 cohort 1.
For 2025, Wix is targeting the more ambitious "Rule of 45," demonstrating confidence in its balanced approach to growth and profitability. The company expects fiscal 2025 revenue between $1.970 billion and $2.000 billion, with bookings projected at $2.025 billion to $2.060 billion 3.
Wix has announced plans for two major product launches in 2025:
These initiatives are expected to drive double-digit growth in the self-creator business by 2026 1.
Wix's stock has surged 82% in the last 12 months, reflecting investor confidence in the company's growth strategy. Analysts from Raymond James and JMP Securities note that Wix is gaining market share and is likely to continue doing so through 2025, supported by Studio product improvements and potential benefits from challenges facing rival WordPress 3.
Wix.com reports strong Q3 2024 results, with revenue and earnings beating estimates. The company's AI initiatives drive user growth and improved financials, leading to raised full-year guidance.
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A comparative analysis of SimilarWeb and Wix, two tech companies with divergent market performances. While SimilarWeb shows promise despite market underappreciation, Wix demonstrates strong growth and potential.
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Wix, a leading website building platform, has launched an innovative AI-powered tool designed to simplify website theme customization. This new feature aims to streamline the design process for users, making it easier to create personalized and professional-looking websites.
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Wix.com Ltd. and Google Cloud have announced an expansion of their strategic partnership, integrating Google's Gemini AI technology into Wix Workspace. This collaboration aims to enhance productivity and creativity for Wix users through AI-powered tools.
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HubSpot reports strong Q4 2024 results, beating revenue and EPS estimates. The company's focus on AI integration and platform development drives growth, despite challenges in average revenue per customer.
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