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Israel's Wix.com beats estimates, sees strong 2017
February 15, 2017 / 10:54 AM / 9 months ago

Israel's Wix.com beats estimates, sees strong 2017

TEL AVIV (Reuters) - Wix.com, an Israel-based company which helps small businesses build and operate websites, forecast higher-than-expected revenue in 2017 after fourth-quarter revenue and earnings topped estimates.

The offices website-designer firm Wix.com are shown in Tel Aviv, Israel July 4, 2016. REUTERS/Baz Ratner/File Photo

The company said on Wednesday it had swung to a quarterly profit of 6 cents a share excluding one-time items, its first ever profit, from a 13 cent loss a year earlier. Revenue grew 48 percent to $84.2 million as the number of paid subscribers jumped 39 percent.

It had been forecast to earn 3 cents a share excluding items on revenue of $81.65 million, according to Thomson Reuters I/B/E/S.

Wix offers free basic features for setting up websites but users must pay for extra services such as shopping carts, individual web addresses and site traffic analysis.

During the quarter it added 5 million registered users for a total of 97 million. Of that, it added 171,000 paid subscribers to reach 2.5 million.

The number of registered users surpassed 100 million this month, Wix said.

Employees work at website-designer firm Wix.com offices in Tel Aviv, Israel July 4, 2016. REUTERS/Baz Ratner/File Photo

“As we improve our product and add functionality, there are more chances that a wider distribution of people will be able to finish a website,” Wix President Nir Zohar told Reuters.

In June the company launched technology called Artificial Design Intelligence to make its product easier to use. Zohar also attributed the jump in paid subscribers to Wix’s focus on products for specific users, such as photographers, musicians and event planners.

Wix, whose customers have also created over 22 million mobile sites, projected 2017 revenue of between $409 million and $411 million, up between 41 and 42 percent from 2016. Analysts had on average forecast revenue of $383 million.

The company expects to spend about $180 million on marketing this year, including its Super Bowl campaign, Chief Financial Officer Lior Shemesh said.

Wix’s web traffic and name recognition have grown substantially since its first Super Bowl marketing campaign three years ago, Zohar said.

Half the company’s income is generated outside the United States and Shemesh said Wix hopes to penetrate further into the Asia-Pacific market.

For the first quarter its sees revenue of between $89 million and $90 million, up 45 to 46 percent.

Reporting by Yuval Ben-David and Tova Cohen; Editing by Steven Scheer and David Holmes

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