Slide 1: Earnings Slides: Fourth Quarter and Full Year 2019
EARNINGS SLIDES Fourth Quarter and Full Year 2019 February 20th 2020
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, cumulative cohort collections, collections on a constant currency basis, revenu
Slide 3: Q4 and FY 2019 Results
Q4 and FY 2019 Results
Slide 4: Strong revenue growth
Strong revenue growth Revenue ($ millions) 24- 25% 26% Y/Y Y/Y 26% $205 Y/Y $946 Business Solutions $197 -956 Creative Subscriptions $185 $33 $761 $174 $32 $164 $28 $156 $117 $23 $146 $21 $604 $138 $21 $19 $78 $17 $426 $34 $165 $171 $151 $157 $644 $144 $135 $525 $120 $127 $391 Q1'18 Q2'18 Q3'18 Q4'1
Slide 5: Strong collections growth
Strong collections growth… 23- Collections ($ millions) 24% 29% Y/Y Y/Y 26% Y/Y $1,020 Business Solutions -1,035 $227 $832 Creative Subscriptions $206 $200 $200 $36 $121 $176 $23 $32 $658 $29 $160 $160 $163 $78 $20 $18 $19 $21 $484 $35 $191 $712 $177 $170 $174 $156 $580 $142 $141 $142 $449 Q1'18 Q2'
Slide 6: Combined with robust free cash flow generation
…combined with robust free cash flow generation Free Cash Flow ($ millions) 24- 15% 26% Y/Y Y/Y 26% Y/Y $155 -162 $37 $33 $127 $30 $31 $29 $24 $24 $102 $21 $71 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 2017 2018 2019 2020E Note: 2020 guidance as provided on February 20, 2020 6
Slide 7: Introducing ARR to demonstrate growth
Introducing ARR to demonstrate growth ($ millions) $680 $707 $622 $648 $561 $587 $497 $531 Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Note: Annualized Recurring Revenue (ARR) is calculated as Monthly Recurring Revenue (MRR) multiplied by 12. MRR is calculated as all active Creative Subscription
Slide 8: User and subscription bases continue to grow
User and subscription bases continue to grow Registered Users 16% Premium Subscriptions 13% (millions, at End of Period) Y/Y (millions, at End of Period) Y/Y Note: Users and Subscriptions do not include Flok, DeviantArt, Wix Answers or users coming from the Wix Logo Maker funnel. Beginning in Q1 201
Slide 9: Increasing monetization of user cohorts
Increasing monetization of user cohorts Cumulative Collections from Q1 User Cohorts ($ millions) $112M $113M $112M $108M $91M $85M Q1’19 $52M Q1’18 Q1’17 $43M Q1’16 $36M Q1’15 Q1’14 $25M Q1’13 Q1’12 Q1’11 Q1’10 Number of Quarters Passed Note: Data as of December 31, 2019. Excludes collections from u
Slide 10: Continued growth of ARPS
Continued growth of ARPS Average Annual Revenue per Subscription Note: ARPS is defined as total revenue over last four quarters / average number of premium subscriptions over last four quarters. Subscriptions only include Creative Subscriptions 10
Slide 11: Consistent cohort behavior over the long term
Consistent cohort behavior over the long term Active Premium Subscriptions from Q1 User Cohorts New Registered Users Q1’19 – 6.6M 273K Q1’18 – 5.9M 214K 233K Q1’17 – 5.9M 213K Q1’16 – 5.3M 192K 179K Q1’15 – 4.6M 154K Q1’14 – 4.1M 127K 123K 103K 104K Q1’13 – 3.7M 92K 73K Q1’12 – 2.7M 62K Q1’11 – 1.8M
Slide 12: Existing cohorts are a growing source of future collections
Existing cohorts are a growing source of future collections Actual and Potential Future Collections From Q1’10 – Q4’19 Cohorts $6.8 billion Expected future collections from existing cohorts (up 33% y/y) Note: Data represents actual Collections from Q1’10 – Q4’19; cohorts since creation and forecaste
Slide 13: Growing base of cohort collections
Growing base of cohort collections Annual collections by user cohort ($ millions) 2019*: 2018: $680M $642M Note: Excludes collections from users coming from the Wix Logo Maker funnel. It also excludes collections from Flok, DeviantArt, and Wix Answers. * 2019 collections are constant currency assumi
Slide 14: Efficient marketing based on 7-9 month TROI
Efficient marketing based on 7-9 month TROI One Time Marketing, Ongoing Collections … After 20 … After 16 Quarters … After 12 Quarters Quarters … After 8 3.5x 4.6x 5.7x Quarters 2.1x … After 4 Quarters 1.0x Marketing Cost ($ million) Cohort Net Collections ($ million) Note: Data as of December 31, 2
Slide 15: Healthy mix of annual and monthly subscriptions
Healthy mix of annual and monthly subscriptions % of Gross New Subscriptions % of Total Subscriptions Note: Subscriptions only include Creative Subscriptions Note: Data as of December 31, 2019 15
Slide 16: Prior cohorts continue to convert
Prior cohorts continue to convert % of Gross New Subscriptions by Prior and Current User Cohorts Note: Subscriptions only include Creative Subscriptions 16
Slide 17: Increasing geographic penetration
Increasing geographic penetration FX-Neutral Revenue by Geography (% of total) and Q4’19 Y/Y Growth North America +31% Y/Y Europe +21% Y/Y Latin America +11% Y/Y Asia and others +18% Y/Y Note: Q4’19 Revenue by Geography and Y/Y change based on constant FX rates from Q4’18 17
Slide 18: Appendix
APPENDIX
Slide 19: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures 2018 2019 2017 2018 2019 in 000s Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 FY FY FY Revenue $137,775 $146,132 $155,600 $164,197 $174,290 $185,419 $196,791 $204,588 $425,636 $603,704 $761,088 Change in deferred revenue $21,880 $13,763 $7,177 $11,861 $26,089 $14,144
Slide 20: Reconciliation of GAAP to Non-GAAP Financial Measures
Reconciliation of GAAP to Non-GAAP Financial Measures 2020 2020 in 000s Low High Projected revenues $946,000 $956,000 Projected change in deferred revenues $74,000 $79,000 Projected Collections $1,020,000 $1,035,000 20