Slide 1: Second Quarter 2017 Earnings Results
Click here to edit the name of your presentation Second Quarter 2017 Earnings Results UNDER EMBARGO UNTIL 1AM ET ON MAY 10, 2017 1
Slide 2: Safe Harbor
Safe Harbor Non-GAAP Financial Measures 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: collections, non-GAAP gross margin, non-GAAP operating loss, free cash flow, non-GAAP net lo
Slide 3: Key Metrics: Q2'17
Key Metrics: Q2’17 Registered Users Premium Subscriptions Collections (000s) (000s) ($000s) 24% 35% 44% $117,121 108,739 Y/Y Y/Y 2,865 Y/Y 87,405 2,121 $81,453 Q2'16 Q2'17 Q2'16 Q2'17 Q2'16 Q2'17 Improvement Improvement in Conversion in ACPS 3
Slide 4: Q2'17 Financial Highlights
Q2’17 Financial Highlights • Revenue of $103.5 million, exceeding prior guidance of $101-102 million; revenue growth accelerates to 51% Y/Y • Record collections of $117.1 million exceeded prior guidance of $116-117 million; 44% Y/Y growth • Gross margin on a GAAP basis was 83%, compared to 84% in th
Slide 5: Q2'17 Business Highlights
Q2’17 Business Highlights • Introduced WixCode, a market-expanding platform enabling users to create powerful web applications: Wix Code provides an integrated development environment for the easy creation of web applications with custom business logic and a stunning user interface. This product ope
Slide 6: Users and Subscriptions
Users and Subscriptions 35% 24% Y/Y Registered Users Y/Y Premium Subscriptions (millions, at End of Period) (000s, at End of Period) 109 2,865 103 2,673 97 92 2,465 87 2,294 82 2,121 77 72 1,938 68 1,767 63 1,643 58 1,503 50 1,371 50 46 1,233 42 1,125 39 1,019 36 908 32 790 28 707 25 627 22 549 470
Slide 7: Revenue and Collections
Revenue and Collections 51% 44% Revenue Y/Y Collections Y/Y ($ millions) ($ millions) $104 $117 $115 $93 $84 $98 $76 $87 $81 $69 $76 $62 $57 $67 $54 $62 $49 $57 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 7
Slide 8: Deferred Revenue Growth
Deferred Revenue Growth 48% 51% Deferred Revenue Y/Y Revenue Y/Y ($ millions) ($ millions) $195 $104 $182 Deferred Revenue nearly all $93 realized over next 12 months $157 $84 $143 $132 $76 $119 $69 $105 $95 $62 $87 $57 $54 $49 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Q2'15 Q3'15 Q4'15
Slide 9: Accelerating Free Cash Flow Generation
Accelerating Free Cash Flow Generation Free Cash Flow1 ($ millions) $67-68 $36 $19 $17 $15 $15 $10 $8 $9 $3 $5 ($2) Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 2015 2016 2017E 1Net cash provided by operating activities for the second quarter of 2017 was $19.7 million, while capital expendi
Slide 10: Consistent Behavior
Consistent Behavior Active Premium Subscriptions from Q1 User Cohorts New Registered Users 225,731 1Q17 5,875,165 1Q16 5,305,726 178,429 178,663 1Q15 4,568,323 1Q14 138,309 4,089,253 126,962 116,086 1Q13 102,980 3,714,472 92,019 1Q12 78,493 2,651,656 62,071 1Q11 33,747 34,387 1,833,897 26,735 29,612
Slide 11: Long Term Subscriptions
Long Term Subscriptions % of Gross New Subscriptions % of Total Subscriptions 77% 79% 77% 75% 75% 70% 67% 65% 65% 18% 35% 35% 33% 30% 82% 25% 23% 23% 25% 21% Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 1 Year or Longer Monthly 1 Year or Longer Monthly Note: Data as of June 30, 2017 11
Slide 12: Ongoing Cohort Conversions
Ongoing Cohort Conversions % of Gross New Subscriptions by Prior and Current User Cohorts 62% 63% 62% 63% 63% 58% 60% 60% 59% 42% 40% 40% 41% 38% 37% 38% 37% 37% Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Prior user cohorts Current user cohort Note: Data as of June 30, 2017 12
Slide 13: Growing Base of Cohort Collections
Growing Base of Cohort Collections Annual collections by user cohort ($ millions) User Cohort Collections $500 In 2015: $236 million In 2016: $251 million1 $400 $300 $200 $100 $0 2010 2011 2012 2013 2014 2015 2016 2010 & Prior 2011 2012 2013 2014 2015 2016 12016 collections are constant currency ass
Slide 14: Marketing Efficiency
Marketing Efficiency One Time Marketing, Ongoing Monthly Collections … After 18 Quarters … After 14 Quarters 6.8x 3.9x … After 10 Quarters $55 … After 6 Quarters 3.0x To Date $68 $33 1.9 x To Date … After 2 Quarters $33 $40 $57 $8 0.9 x $33 To Date To To Date Date $33 To$48 Date Q1’13 Cohort To Date
Slide 15: Increasing Collections per New Subscription
Increasing Collections per New Subscription $156 $156 $153 $150 $145 $141 $133 $132 $132 Q2'15 Q3'15 Q4'15 Q1'16 Q2'16 Q3'16 Q4'16 Q1'17 Q2'17 Avg. Collection per New Annual Subscription Note: Based on New Annual Subscriptions in the US 15
Slide 16: Increasing Geographic Penetration
Increasing Geographic Penetration FX-Neutral Revenue by Geography (% of Total) 9% 14% 53% Y/Y 3% 17% 8% 42% Y/Y 27% 51% Y/Y Growth Rate vs. Q2’16 (Constant currency basis) 71% 51% 54% Y/Y 2010 Q2'171 North America Europe Latin America Asia and others 1Revenue by Geography and Y/Y change based on con
Slide 17: Non-GAAP Financial Results
Non-GAAP Financial Results 2016 2017 Full Year in 000s Q2 Q2 2014 2015 2016 Collections $ 81,453 $ 117,121 $ 171,255 $ 241,687 $ 342,069 Revenues 68,730 103,522 141,841 203,518 290,103 Non-GAAP Gross Profit 58,187 87,232 116,738 169,901 246,614 Gross Margin % 85% 84% 82% 83% 85% Non-GAAP R&D expense
Slide 18: Appendix
APPENDIX 18
Slide 19: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures 2015 2016 2017 in 000s Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Revenue $44,524 $48,581 $53,582 $56,831 $61,586 $68,730 $75,611 $84,176 $92,538 $103,522 Change in deferred revenue $11,345 $8,787 $7,998 $10,039 $14,108 $12,723 $11,659 $13,476 $22,008 $13,599 Collectio
Slide 20: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures 2015 2016 2017 in 000s Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Research and development (GAAP) $17,448 $18,233 $20,065 $21,901 $24,472 $25,483 $26,536 $28,877 $32,669 $36,749 Options compensation $1,959 $1,831 $2,592 $2,852 $3,111 $3,558 $3,718 $4,156 $4,726 $6,586
Slide 21: Reconciliation of GAAP to Non-GAAP Measures
Reconciliation of GAAP to Non-GAAP Measures 2015 2016 2017 in 000s Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 GAAP Net Loss ($16,026) ($12,279) ($11,724) ($11,305) ($19,912) ($11,420) ($9,643) ($6,182) ($20,885) ($14,264) Share Based Compensation $4,048 $3,787 $5,322 $5,577 $6,137 $6,927 $7,163 $7,821 $8,982 $11