Core Insights - Wix.com Ltd. is a leading global platform for creating and managing digital presence, offering services like website building, hosting, and design tools, competing with platforms such as Squarespace and WordPress [1] Financial Performance - On November 19, 2025, Wix reported an earnings per share (EPS) of $1.68, surpassing the estimated $1.45, indicating strong financial health and operational efficiency [2][6] - Wix's revenue for the period was approximately $505.2 million, slightly below the estimated $526 million, suggesting potential market challenges or impacts from strategic investments [2][6] Growth Metrics - The company experienced a 14% year-over-year increase in total bookings and revenue, driven by strong new cohort behavior and the success of its coding platform, Base44 [3] - Base44 has rapidly gained popularity, with over 2 million users and more than a thousand new paying subscribers joining daily, positioning it to achieve at least $50 million in annual recurring revenue (ARR) by year-end [3] Valuation Metrics - Wix's price-to-earnings (P/E) ratio is approximately 42.67, reflecting investor confidence in its earnings potential [4] - The price-to-sales ratio stands at about 3.78, indicating the value placed on each dollar of sales, while the enterprise value to sales ratio is around 3.94 [4] Financial Structure - The company has a negative debt-to-equity ratio of -8.50, suggesting a distinctive capital strategy [5] - Wix's current ratio is approximately 0.81, indicating its ability to cover short-term liabilities with short-term assets [5] - An earnings yield of about 2.34% demonstrates a solid return on investment, underscoring its financial stability and growth potential [5]

Summary of Key Points Core Viewpoint - Wix.com Ltd. (WIX) shares are experiencing a significant sell-off in pre-market trading, declining over 7% despite the company beating both top and bottom line estimates and raising its guidance, indicating a continuation of a trend observed in recent quarters [1] Company Performance - Wix.com Ltd. reported better-than-expected financial results, surpassing analysts' estimates for both revenue and earnings [1] - The company has raised its guidance, suggesting optimism about future performance despite the current market reaction [1] Market Reaction - The pre-market trading decline of over 7% reflects a broader trend where positive earnings reports do not necessarily lead to positive stock performance, indicating potential investor skepticism or profit-taking behavior [1]

Financial Data and Key Metrics Changes - Total bookings grew to $515 million in Q3 2025, up 14% year-over-year, driven by robust new user cohorts and better-than-expected results from Base44 [15][22] - Total revenue increased to $505 million, also up 14% year-over-year, exceeding the high end of guidance [15][22] - Non-GAAP gross margin in Q3 was 69%, slightly down from 70% in Q2 [18] - Free cash flow for Q3 was $159 million, or 32% of revenue, an increase from 30% last quarter [21] Business Line Data and Key Metrics Changes - Partners' revenue grew 24% year-over-year to $192 million, driven by traction among professional designers and solid Studio adoption [16] - Transaction revenue was $65 million, up 20% year-over-year, driven by 13% growth in GPV [16] - Base44's share of audience traffic increased to over 10% in October, up from low single digits in June [10][12] Market Data and Key Metrics Changes - Organic traffic improved as more users searched for Wix online, indicating enhanced brand awareness [9] - Base44 serves over 2 million users globally, translating to more than 1,000 new paying subscribers daily [12] Company Strategy and Development Direction - The company aims to democratize software creation through Vibe Coding, enabling users without coding knowledge to build applications [3][5] - Base44 is positioned as a leader among low-code tools, with significant growth potential in the AI-powered app building space [6][10] - The company plans to enhance its marketing efforts to capture stronger-than-anticipated demand for Base44 [23] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of the core business and the ability to enter new markets effectively [14] - The company raised its full-year bookings outlook to $2,060-$2,078 million, reflecting strong performance from Base44 [22][23] - Management anticipates improved operating and free cash flow margins over time as AI costs decrease and marketing investments normalize [21][24] Other Important Information - The company issued $1.15 billion in 0% convertible senior notes due 2030, with plans to use the cash for business purposes and share repurchases [22] - The anticipated launch of a new flagship product has been delayed to early 2026 due to technical challenges [7][70] Q&A Session Summary Question: Dynamics of monthly vs. annual subscriptions for Base44 - Management noted that most Base44 users are currently on monthly subscriptions, with expectations that they will transition to annual plans over time as trust in the platform grows [28][30] Question: Cost management and AI compute expenses - Management acknowledged that while AI costs are currently high due to new user consumption, they expect to reduce these costs over time through various strategies [31][35] Question: Vision for Wix in the AI era - Management highlighted efforts to ensure that all Wix websites are indexable by LLMs and to continuously add new e-commerce standards to enhance visibility [39][40] Question: Cohort retention trends for Base44 - Management indicated that retention trends for Base44 are similar to those seen in early Wix cohorts, with expectations for improvement as brand recognition grows [42][43] Question: Pathway to improving Base44 margins - Management discussed the need for time to see improved margins as the user base matures and costs stabilize, with expectations for better profitability in the future [48][53] Question: Impact of hyper-growth on margins - Management confirmed that while there will be short-term margin pressure due to high growth and new customer acquisition costs, they anticipate margin improvement as the business scales [56][66]

Financial Data and Key Metrics Changes - Total bookings grew to $515 million in Q3 2025, up 14% year-over-year, driven by robust new user cohorts and better-than-expected results from Base44 [15][16] - Total revenue increased to $505 million, also up 14% year-over-year, exceeding the high end of guidance [15][16] - Non-GAAP gross margin in Q3 was 69%, down slightly from 70% in Q2 [18] - Free cash flow was $159 million, or 32% of revenue, an increase from 30% last quarter [20] Business Line Data and Key Metrics Changes - Partners' revenue grew 24% year-over-year to $192 million, driven by traction among professional designers and solid Studio adoption [16] - Transaction revenue was $65 million, up 20% year-over-year, driven by 13% growth in GPV [16] - Base44's share of audience traffic increased from low single digits in June to over 10% in October [11][12] Market Data and Key Metrics Changes - GPV grew 13% year-over-year to $3.7 billion, with partners contributing approximately 55% of total GPV [16] - Base44 serves over 2 million users globally, translating to more than 1,000 new paying subscribers daily [12] Company Strategy and Development Direction - The company aims to democratize software creation through Vibe Coding, enabling users without coding knowledge to build applications [3][5] - Base44 is positioned as a leader among low-code tools, with significant growth potential in the AI-powered app building space [6][11] - The company is focusing on building a comprehensive brand and marketing function for Base44 to capture a larger market share [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the durability of the core business and the ability to enter new markets effectively [14] - The company raised its full-year bookings outlook to $2,060-$2,078 million, reflecting strong performance from Base44 [22][23] - Expectations for free cash flow are approximately $600 million for 2025, or 30% of revenue [24] Other Important Information - The company issued $1.15 billion in 0% convertible senior notes due 2030, with plans to use the cash for business purposes and potential M&A opportunities [22] - The anticipated launch of a new flagship product has been delayed to early 2026 due to technical challenges [7][70] Q&A Session Summary Question: Dynamics of monthly vs. annual subscriptions for Base44 - Management noted that most Base44 users are on monthly subscriptions, with expectations that as trust builds, more users will transition to annual plans [26][27] Question: Churn rates and subscription dynamics - Churn is currently higher than Wix's standard, but management is optimistic about future retention as the product matures [27][28] Question: Pathway to improving Base44 margins - Management indicated that as Base44 matures, margins are expected to improve, with a focus on reducing AI costs and optimizing the customer mix [49][53] Question: Impact of hyper-growth on margins - Management acknowledged that while there will be short-term margin pressure due to high growth, they expect margins to improve as the business scales [56][66] Question: Delays in the new self-creator tool - The delay is attributed to fine-tuning technology and addressing technical challenges, with a confident outlook for a launch in early 2026 [70] Question: Retention trends for Base44 cohorts - Early retention trends for Base44 are similar to those seen in Wix's early days, with expectations for improvement as brand visibility increases [43][44]

Core Insights - Wix.com Ltd reported non-GAAP earnings per share (EPS) of $1.68 for Q3 2025, significantly exceeding the Zacks Consensus Estimate of 39 cents and up from $1.50 in the same quarter last year [1] - Quarterly revenues increased by 14% year over year to $505.2 million, surpassing the Zacks Consensus Estimate of $502.65 million and management's guidance of $498-$504 million [2] Revenue Breakdown - Creative Subscriptions, accounting for 70.5% of total revenues, saw a 12% year-over-year increase to $356.2 million, with annualized recurring revenues reaching $1.5 billion, up 11% year over year [5] - Business Solutions revenues rose by 18% to $149 million, with transaction revenues totaling $65.3 million, up 20% [5] - Partner revenues increased by 24% year over year to $192.1 million, with regional contributions from North America (61%), Europe (25%), Asia and others (11%), and Latin America (4%) [7] Growth Drivers - Base44 emerged as a key growth engine, increasing market share from low single digits to over 10% since June, with expectations to reach at least $50 million in annual recurring revenue (ARR) by year-end [3][9] - Bookings improved by 14% year over year to $514.5 million, with Creative Subscriptions bookings increasing by 12% and Business Solutions bookings rising by 20% [6] Financial Performance - Non-GAAP gross margin remained flat at 69%, with Creative Subscriptions achieving a margin of 84% and Business Solutions at 34% [10] - Non-GAAP operating income was reported at $89.9 million, compared to $88.4 million in the previous year [10] Cash Flow and Balance Sheet - As of September 30, 2025, Wix had cash and cash equivalents of $889.6 million, up from $693 million as of June 30, 2025 [11] - Free cash flow was reported at $127.3 million, with capital expenditures totaling $1.4 million [11] 2025 Outlook - Wix revised its 2025 bookings outlook to $2,060–2,078 million, an increase of 13–14% from previous projections [12] - The full-year revenue outlook was adjusted to $1,990–2,000 million, reflecting a similar increase driven by multi-year plan adoption [13] - Non-GAAP gross margin expectations were slightly lowered to 68–69% due to increased AI costs, with operating expenses projected to be about 50% of full-year revenue [14] Q4 2025 Guidance - Management anticipates total revenues for Q4 2025 to be between $521 million and $531 million, indicating a year-over-year increase of 13–15% [16]

Financial Performance - Total registered users are approximately 299 million[11] - Q3'25 transaction revenue reached $65 million, a 20% year-over-year increase[11] - Q3'25 partners revenue was $192 million, up 24% year-over-year[11] - Creative Subscriptions Annualized Recurring Revenue (ARR) is approximately $1.5 billion[11] - Q3'25 free cash flow (FCF) margin was 32%[11] - Q3'25 gross payment volume (GPV) reached $3.7 billion, a 13% year-over-year increase[11] Revenue and Bookings - Total revenue for 2025 is estimated to be between $1.99 billion and $2 billion[23] - Creative Subscriptions ARR expanded consistently, reaching $1.457 billion in Q3'25, an 11% year-over-year increase[27] - Total bookings for 2025 are projected to be between $2.06 billion and $2.078 billion[30] Strategic Initiatives - Base44, acquired in June 2025, is projected to generate at least $50 million of ARR by the end of 2025[19] - The Q1'25 user cohort is the strongest since the COVID cohort, growing 8% year-over-year and 17% quarter-over-quarter[39] - The company expects approximately $18.4 billion in future bookings over the next 10 years from existing cohorts[46]

Core Insights - Wix.com reported quarterly earnings of $1.68 per share, exceeding the Zacks Consensus Estimate of $1.45 per share, and showing an increase from $1.5 per share a year ago, resulting in an earnings surprise of +15.86% [1] - The company generated revenues of $505.19 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 0.51% and up from $444.67 million year-over-year [2] - Wix.com has outperformed consensus EPS estimates three times in the last four quarters and has also topped revenue estimates three times during the same period [2] Future Outlook - The stock's immediate price movement will largely depend on management's commentary during the earnings call and the sustainability of earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $1.57 on revenues of $524.39 million, while for the current fiscal year, the estimate is $6.74 on revenues of $1.99 billion [7] - The Zacks Rank for Wix.com is currently 3 (Hold), indicating that shares are expected to perform in line with the market in the near future [6] Industry Context - The Computers - IT Services industry, to which Wix.com belongs, is currently ranked in the top 34% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Exhibit 99.1 Wix Reports Third Quarter 2025 Results NEW YORK – November 19, 2025 -- Wix.com Ltd. (Nasdaq: WIX) (the "Company"), a leading global platform for creating, managing, and growing a complete digital presence, today reported financial results for the third quarter of 2025. In addition, the Company provided its outlook for the fourth quarter and an updated outlook for full year 2025. Please visit the Wix Investor Relations website at https://investors.wix.com to view the Q3'25 Shareholder Update and ...

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Core Insights - Wix's stock price has fallen into a bear market, declining over 48% from its peak this year due to concerns regarding its growth and increasing competition [1] Company Summary - The significant drop in Wix's stock price indicates a loss of investor confidence, primarily driven by worries about the company's growth trajectory [1] - The emergence of new competitors in the market is contributing to the challenges faced by Wix, further exacerbating the decline in its stock value [1]