The high end of our outlook puts us at Rule of 45 in 2025 as we continue to prioritize balancing profitable growth through best-in-class innovation and steadfast execution.” Q4 2024 Financial Results Total revenue in the fourth quarter of 2024 was $460.5 million, up 14% y/y Creative Subscriptions revenue in the fourth quarter of 2024 was $329.7 million, up 11% y/yCreative Subscriptions ARR increased to $1.343 billion as of the end of the quarter, up 13% y/y Business Solutions revenue in the fourth quarter of 2024 was $130.7 million, up 21% y/y Transaction revenue3 was $57.1 million, up 23% y/y Partners revenue4 in the fourth quarter of 2024 was $168.1 million, up 29% y/yTotal bookings in the fourth quarter of 2024 were $464.6 million, up 18% y/y Total bookings on a y/y constant currency basis were $466.2 millionCreative Subscriptions bookings in the fourth quarter of 2024 were $325.2 million, up 15% y/yBusiness Solutions bookings in the fourth quarter of 2024 were $139.4 million, up 25% y/y Total gross margin on a GAAP basis in the fourth quarter of 2024 was 69% Creative Subscriptions gross margin on a GAAP basis was 84%Business Solutions gross margin on a GAAP basis was 30% Total non-GAAP gross margin in the fourth quarter of 2024 was 70% Creative Subscriptions gross margin on a non-GAAP basis was 85%Business Solutions gross margin on a non-GAAP basis was 32% GAAP net income in the fourth quarter of 2024 was $48.0 million, or $0.86 per basic share or $0.80 per diluted shareNon-GAAP net income in the fourth quarter of 2024 was $117.1 million, or $2.10 per basic share or $1.93 per diluted shareNet cash provided by operating activities for the fourth quarter of 2024 was $133.7 million, while capital expenditures totaled $2.0 million, leading to free cash flow of $131.8 million FY 2024 Financial Results Total revenue for the full year 2024 was $1.761 billion, up 13% y/y Creative Subscriptions revenue for the full year 2024 was $1.265 billion, up 10% y/yBusiness Solutions revenue for the full year 2024 was $495.7 million, up 21% y/y Transaction revenue3 was $214.9 million, up 21% y/y Partners revenue4 for the full year 2024 was $610.1 million, up 30% y/yTotal bookings for the full year 2024 were $1.830 billion, up 15% y/y Creative Subscriptions bookings for the full year 2024 were $1.315 billion, up 12% y/yBusiness Solutions bookings for the full year 2024 were $514.6 million, up 22% y/y Total gross margin on a GAAP basis for the full year 2024 was 68% Creative Subscriptions gross margin on a GAAP basis was 83%Business Solutions gross margin on a GAAP basis was 29% Total non-GAAP gross margin for the full year 2024 was 69% Creative Subscriptions gross margin on a non-GAAP basis was 84%Business Solutions gross margin on a non-GAAP basis was 30% GAAP net income for the full year 2024 was $138.3 million, or $2.49 per basic share or $2.36 per diluted shareNon-GAAP net income for the full year 2024 was $383.3 million, or $6.90 per basic share or $6.39 per diluted shareNet cash provided by operating activities for the full year 2024 was $497.4 million, while capital expenditures totaled $19.3 million, leading to free cash flow of $478.1 millionExcluding the capex investment associated with our new headquarters office build out, free cash flow1 for the full year 2024 would have been $488.4 million, or 28% of revenueExecuted $466 million in repurchases of ordinary shares in 2024 as we remained committed to share count management and returning value to shareholdersFinished full year 2024 with 6.2 million total premium subscriptions as of December 31, 2024Registered users as of December 31, 2024 were over 282 millionTotal employee count as of December 31, 2024 was 5,283 ____________________1 Free cash flow excluding expenses associated with the buildout of our new corporate headquarters.2 Based on number of active live sites as reported by competitors' figures, independent third-party data and internal data as of Q3 2024.3 Transaction revenue is a portion of Business Solutions revenue, and we define transaction revenue as all revenue generated through transaction facilitation, primarily from Wix Payments, as well as Wix POS, shipping solutions and multi-channel commerce and gift card solutions.4 Partners revenue is defined as revenue generated through agencies and freelancers that build sites or applications for other users ("Agencies”) as well as revenue generated through B2B partnerships, such as LegalZoom or Vistaprint ("Resellers”).
Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, our expectation that we will be able to attract and retain registered users and partners, and generate new premium subscriptions, in particular as we continuously adjust our marketing strategy and as the macro-economic environment continues to be turbulent; our expectation that we will be able to increase the average revenue we derive per premium subscription, including through our partners; our expectation that new products and developments, as well as third-party products we will offer in the future within our platform, will receive customer acceptance and satisfaction, including the growth in market adoption of our online commerce solutions and our Wix Studio product; our expectations regarding our ability to develop relevant and required products using artificial intelligence ("AI”), the regulatory environment impacting AI and AI-related activities, including privacy and intellectual property, and potential competitive impacts from AI tools; our assumption that historical user behavior can be extrapolated to predict future user behavior, in particular during turbulent macro-economic environments; our prediction of the future revenues and/or bookings generated by our user cohorts and our ability to maintain and increase such revenue growth, as well as our ability to generate and maintain elevated levels of free cash flow and profitability; our expectation to maintain and enhance our brand and reputation; our expectation that we will effectively execute our initiatives to improve our user support function through our Customer Care team, and continue attracting registered users and partners, and increase user retention, user engagement and sales; our ability to successfully localize our products, including by making our product, support and communication channels available in additional languages and to expand our payment infrastructure to transact in additional local currencies and accept additional payment methods; our expectation regarding the impact of fluctuations in foreign currency exchange rates, interest rates, potential illiquidity of banking systems, and other recessionary trends on our business; our expectations relating to the repurchase of our ordinary shares and/or Convertible Notes pursuant to our repurchase program; our expectation that we will effectively manage our infrastructure; our expectation to comply with AI, privacy, and data protection laws and regulations as well as contractual privacy and data protection obligations; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; our expectations regarding future changes in our cost of revenues and our operating expenses on an absolute basis and as a percentage of our revenues, as well as our ability to achieve and maintain profitability; our expectations regarding changes in the global, national, regional or local economic, business, competitive, market, and regulatory landscape, including as a result of Israel-Hamas war and/or the Israel-Hezbollah hostilities and/or the Ukraine-Russia war and any escalations thereof and potential for wider regional instability and conflict; our planned level of capital expenditures and our belief that our existing cash and cash from operations will be sufficient to fund our operations for at least the next 12 months and for the foreseeable future; our expectations with respect to the integration and performance of acquisitions; our ability to attract and retain qualified employees and key personnel; and our expectations about entering into new markets and attracting new customer demographics, including our ability to successfully attract new partners large enterprise-level users and to grow our activities, including through the adoption of our Wix Studio product, with these customer types as anticipated and other factors discussed under the heading "Risk Factors” in the Company’s annual report on Form 20-F for the year ended December 31, 2023 filed with the Securities and Exchange Commission on March 22, 2024.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands) Three Months Ended Year Ended December 31, December 31, 2024 2023 2024 2023 (unaudited) (unaudited)OPERATING ACTIVITIES: Net income$48,024 $ 2,954 $138,322 $ 33,137Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 6,278 6,725 25,246 20,492Amortization 1,460 1,488 5,869 5,954Share based compensation expenses 61,801 58,195 240,721 224,625Amortization of debt discount and debt issuance costs 793 789 3,166 4,194Changes in accrued interest and exchange rate on short term and long term deposits (635) (586) 852 (2,415)Non-cash impairment, restructuring and other costs - 3,567 - 26,699Amortization of premium and discount and accrued interest on marketable securities, net (7,838) 4,237 (13,381) 8,346Remeasurement loss (gain) on Marketable equity - (10,296) (3,367) (30,608)Changes in deferred income taxes, net (7) (2,035) (5,196) (8,784)Changes in operating lease right-of-use assets 4,351 7,174 24,246 27,231Changes in operating lease liabilities (2,821) 16,701 (33,086) (31,333)Loss on foreign exchange, net 2,471 - 3,906 -Decrease (increase) in trade receivables 4,058 (2,794) 11,228 (15,308)Decrease in prepaid expenses and other current and long-term assets (63,684) (10,845) (76,963) (20,105)Increase (decrease) in trade payables 17,329 15,120 12,893 (52,455)Increase (decrease) in employees and payroll accruals 66,407 (8,307) 85,426 (29,532)Increase in short term and long term deferred revenues 1,609 2,788 74,450 76,193Increase (decrease) in accrued expenses and other current liabilities (5,860) 5,505 3,083 11,915Net cash provided by operating activities 133,736 90,380 497,415 248,246INVESTING ACTIVITIES: Proceeds from short-term deposits and restricted deposits 97,051 131,754 276,697 625,495Investment in short-term deposits and restricted deposits (25,540) (99,725) (170,332) (297,917)Investment in marketable securities - (2,607) (267,209) (6,732)Proceeds from marketable securities 15,000 33,690 125,176 250,960Purchase of property and equipment and lease prepayment (1,562) (9,582) (17,813) (63,021)Capitalization of internal use of software (401) (408) (1,523) (3,028)Investment in other assets - - - (111)Proceeds from investment in other assets$- - $550 -Proceeds from sale of equity securities - 19,203 22,148 68,671Purchases of investments in privately held companies (1,000) (76) (3,160) (7,603)Net cash provided by investing activities 83,548 72,249 (35,466) 566,714FINANCING ACTIVITIES: Proceeds from exercise of options and ESPP shares 6,692 898 59,576 39,660Purchase of treasury stock - (58,698) (466,302) (127,017)Repayment of convertible notes - - - (362,667)Net cash provided by (used in) financing activities 6,692 (57,800) (406,726) (450,024)Effect of exchange rates on cash, cash equivalent and restricted cash (2,471) - (3,906) -INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 221,505 104,829 51,317 364,936CASH AND CASH EQUIVALENTS—Beginning of period 439,434 504,793 609,622 244,686CASH AND CASH EQUIVALENTS—End of period$660,939 $609,622 $660,939 $609,622 Wix.com Ltd.
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