#1... Agatha Krönberg Manufacturing The Unknown Land Chill Bill Absolute Value Store Bio 20th Feb eb 2019 W чтог uary Cart (0) EARNINGS SLIDES Fourth Quarter and Full Year 2018 Wix.com#2Safe 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 income (loss), non-GAAP net income (loss), non-GAAP net income (loss) per share, non-GAAP research and development, non-GAAP selling and marketing, non-GAAP general and administrative and free cash flow (collectively the "Non-GAAP financial measures"). Collections represents the total cash collected by us from our customers in a given period and is calculated by adding the change in deferred revenues for a particular period to revenues for the same period. Non-GAAP gross margin represents gross profit calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization, divided by revenue. Non-GAAP operating income (loss) represents operating income (loss) calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, and acquisition-related expenses. Non-GAAP net income (loss) represents net loss calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs and acquisition-related expenses. Non-GAAP net income (loss) per share represents non-GAAP net income (loss) divided by the weighted average number of shares used in computing GAAP loss per share. Non- GAAP research and development represents research and development expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP selling and marketing represents selling and marketing expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP general and administrative represents general and administrative expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense and acquisition-related expenses. Free cash flow represents net cash provided by (used in) operating activities less capital expenditures. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. For more information on the non-GAAP financial measures, please see "Reconciliation of GAAP to Non-GAAP Financial Measures" below. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company has not reconciled its free cash flow guidance to net cash provided by operating activities because net cash provided by operating activities is not accessible on a forward-looking basis. Items that impact net cash provided by operating activities are out of the Company's control and/or cannot be reasonably predicted. Accordingly, a reconciliation to net cash provided by operating activities is not available without unreasonable effort. Forward-Looking Statements This document contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include projections regarding our future performance and may be identified by words like "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "outlook," "future," "will," "seek" and similar terms or phrases. The forward- looking statements contained in this document, including the full year guidance, are based on management's current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, our ability to grow our user base and premium subscriptions; our ability to create new and higher monetization opportunities from our premium subscriptions; our ability to enter into new markets and attract new customer segments; our ability to maintain and enhance our brand and reputation; our prediction of the future collections generated by our user cohorts; our share repurchases made pursuant to our share repurchase plan; our ability to manage the growth of our infrastructure effectively; our ability to effectively execute our initiatives to scale and improve our user support function; the success of our sales efforts; customer acceptance and satisfaction of new products and other challenges inherent in new product development; changes to technologies used in our solutions; or changes in global, national, regional or local economic, business, competitive, market, regulatory and other factors discussed under the heading "Risk Factors" in the Company's 2017 annual report on Form 20-F filed with the Securities and Exchange Commission on March 29, 2018. Any forward-looking statement made by us in this press release speaks only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise. 2#3Q4 and FY 2018 Results#4Strong revenue growth Revenue ($ millions) $84 $93 $104 $111 $119 $138 Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 $146 Q2'18 Note: 2019 guidance as provided on February 20, 2019; 2018 revenue based on ASC 606 $156 Q3'18 39% Y/Y $164 Q4'18 $142 $204 $290 $426 42% $755- Y/Y 761 $604 25- 26% Y/Y 2014 2015 2016 2017 2018 2019E 4#5Strong collections growth... Collections ($ millions) $98 $115 $117 $120 Q4'16 Q1'17 Q2'17 Q3'17 Note: 2019 guidance as provided on February 20, 2019 $132 $160 $160 Q4'17 Q1'18 Q2'18 $163 33% Y/Y $176 Q3'18 Q4'18 $171 2014 $242 2015 $342 $484 36% Y/Y $658 24- 26% Y/Y $817- 827 2016 2017 2018 2019E LO 5#6...combined with robust free cash flow generation Free Cash Flow* ($ millions) $19 Q4'16 $15 Q1'17 $17 $19 Q2'17 Q3'17 $20 Q4'17 $21 Q1'18 $24 Q2'18 $24 67% Y/Y $33 Q3'18 Q4'18* $15 $36 $71 Note: 2019 guidance as provided on February 20, 2019 *Net cash provided by operating activities for Q4 2018 was $36.1 million, while capital expenditures totaled $3.4 million, leading to free cash flow of $32.7 million 44% Y/Y $102 2015 2016 2017 2018 33- 38% Y/Y $135- 140 2019E 6#7User and subscription bases continue to grow Registered Users (millions, at End of Period) 42 46 50 54 50 8 2013 2014 68 72 77 82 2015 87 92 97 2016 109, 103 114, 119 2017 125 131 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 19% Y/Y 137 142 2018 Premium Subscriptions (millions, at End of Period) 0.8 0.9 1.0 1.1 1.2 1.4 1.5 1.6 1.8 1.9 2.1 Note: Users do not include mobile Wix App, Flok, DeviantArt, or Wix Answers. Subscriptions do not include Flok, DeviantArt, Wix Answers, or Wix Logo Maker 2.3 2.5 2.7 2.9 3.1 3.2 3.5 3.7 24% Y/Y 3.8 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2013 2014 2015 2016 2017 2018 4.0 7#8Continued growth of ARPS Average Annual Revenue per Subscription $133 Q3'16 $137 Q4'16 $139 Q1'17 $143 Q2'17 $146 Q3'17 $150 Q4'17 $154 Q1'18 $157 Q2'18 $162 Q3'18 $168 Q4'18 Note: ARPS is defined as total revenue over last four quarters / average number of subscriptions over last four quarters. Subscriptions do not include Flok, DeviantArt, Wix Answers, or Wix Logo Maker 8#9Consistent cohort behavior over the long term Active Premium Subscriptions from Q1 User Cohorts New Registered Users Q1'18 5,925,513 Q1'17- 5,875,165 213,370 Q1'165,305,726 Q1'15-4,568,323 Q1'144,089,253 126,962 102,980 92,019 Q1'13 3,714,472 Q1'12 2,651,656 178,663 62,071 Q1'111,833,897 33,747 29,612 18,513 Q1'10919,221 280,236 219,950 168,968 132,118 111,497 77,136 34,117 26,654 -17,913 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 Number of Quarters Passed Note: Data as of December 31, 2018. Users do not include mobile Wix App, Flok, DeviantArt, or Wix Answers. Subscriptions do not include Flok, DeviantArt, Wix Answers, or Wix Logo Maker 9#10Increasing monetization of user cohorts Cumulative Collections from Q1 User Cohorts (in millions) Q1'18 Q1'17 Q1'16 Q1'15 Q1'14 Q1'13 Q1'12 Q1'11 Q1'10- $100 $90 $80 $70 $60 $50 $40 $30 $20 $10 و $47 $75 $85 Note: Data as of December 31, 2018. Excludes collections from Flok or DeviantArt $86 $93 $72 Number of Quarters Passed $37 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 $32 $23 10#11Growing base of cohort collections Annual collections by user cohort ($ millions) 2010 2011 2012 Note: Excludes collections from Flok or DeviantArt 2013 User Cohort Collections In 2017: $468 million In 2018: $506 million 2014 2015 2016 2017 2018 ■2010 & Prior 2011 2012 2013 2014 2015 2016 2017 2018 ($ millions) $650 $550 $450 $350 $250 $150 $50 -$50 11#12Efficient marketing based on 7-9 month TROI One Time Marketing, Ongoing Collections After 4 Quarters 1.1x $44 $47 To Date Q1'18 Cohort Marketing Cost ($ million) After 8 Quarters 2.4x $32 $75 To Date Q1'17 Cohort After 12 Quarters 3.4x Cohort Net Collections ($ million) $25 $85 To Date Q1'16 Cohort ... After 16 Quarters 4.5x $19 $86 To Date Q1'15 Cohort ... After 20 Quarters 5.3x $93 To Date $18 Q1'14 Cohort Note: Data as of December 31, 2018; TROI is Time to Return On (Marketing) Investment. We define this metric as the time it takes to collect dollars from new premium subscriptions acquired in a cohort to equal dollars spent on direct marketing costs in the same cohort. We aim for 100% TROI in 7-9 months. Numbers are rounded to the nearest million. Marketing cost includes only direct marketing and related costs associated with the acquisition of users. Cohort Net Collections do not include Flok or DeviantArt 12#13Healthy mix of annual and monthly subscriptions % of Gross New Subscriptions 70% 30% 65% 35% 67% 33% 64% 36% 68% 32% 67% 67% 66% 33% 33% 34% 69% Note: Subscriptions do not include Flok, DeviantArt, Wix Answers, or Wix Logo Maker 31% Q4'16 Q1'17 Q2'17 Q3'17 Q4'17 Q1'18 Q2'18 Q3'18 Q4'18 -1 Year or Longer -Monthly % of Total Subscriptions 17% 83% ■1 Year or Longer Monthly Note: Data as of December 31, 2018 13#14Prior cohorts continue to convert % of Gross New Subscriptions by Prior and Current User Cohorts 63% 37% Q4'16 59% 41% Q1'17 63% 37% Q2'17 60% 40% Q3'17 Prior user cohorts Note: Subscriptions do not include Flok, DeviantArt, Wix Answers, or Wix Logo Maker 62% 38% Q4'17 59% 41% Q1'18 Current user cohort 61% 39% Q2'18 61% 39% Q3'18 63% 37% Q4'18 14#15Increasing geographic penetration FX-Neutral Revenue by Geography (% of total) 9% 17% 71% 2010 3% North America ■ Europe Latin America 14% 8% 26% 52% FY'18 Asia and others 39% Y/Y 30% Y/Y 40% Y/Y 44% Y/Y Note: FY'18 Revenue by Geography and Y/Y change based on constant FX rates from FY'17; 2018 revenue based on ASC 606 Growth Rate vs. FY'17 (Constant currency basis) 15#16Wix: Creation without limits + Novice w ABOUT US Wix ADI Get Online Fast пя Enter client details and design preferences and let our Al design and build a website in seconds FRACES DER WORK XKUTIS CONTACT JADE & ANDY VINTAGE CAR SPECIALIST TORDNIN Templates Stand on the shoulders of giants Choose from an extensive template gallery to match every personal or business need your clients might have T Summer Wear L Change Image Co. Wix Editor Panora Total Design Freedom Start with a blank slate on the world's most innovative drag and drop website builder CONTACT US Business-ready components Out of the box solutions Jatch caphur, methods g62 }) ther (h-tphosporus) if itpfesponsa.oki ( stuen kolpespese joon(); pok return homse."eject"retch <1 105 exceced' ) UNLU; S consolen (180917) } 14' Wix Code Creation without limits Seamlessly integrate databases, CRM, marketing tools and cutting edge technology in your custom websites Broadest and Strongest Product Platform Expert Create custom crafted web experience with a seamless integration of Javascript onto the Wix editor and products 16#17APPENDIX#18Non-GAAP Financial Results 2017 2018 Q4 Q4 $118,545 $164,197 $132,203 $176,058 $100,523 $131,000 85% $33,997 Full Year 2016 2017 2018 $290,103 $425,636 $603,704 $342,069 $483,989 $658,385 $246,614 $359,708 $481,743 85% 85% 80% $87,570 $121,293 80% $43,207 26% $156,384 29% 28% 26% 25% 26% $47,313 $57,832 30% 26% $151,759 24% $237,639 39% 40% 35% 52% 36% 33% 40% $9,510 $11,150 44% $19,814 7% $34,275 36% $40,476 7% 8% 7% 8% 7% 6% 6% $18,811 7% $9,099 6% $47,244 $9,703 ($12,529) 8% 11% (4%) 2% 8% 7% 11% (4%) 2% 7% $7,235 $20,770 ($14,555) ($549) $51,258 in 000s Revenues Collections Non-GAAP Gross Profit Gross Margin % Non-GAAP R&D expenses % of revenues % of collections Non-GAAP S&M expenses % of revenues % of collections Non-GAAP G&A Expenses % of revenues % of collections Non-GAAP Operating Income (Loss) % of revenues % of collections Non-GAAP Net Income (Loss) 25% $195,041 46% Note: non-GAAP items exclude the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs, and acquisition-related expense; 2018 based on ASC 606 18#19Reconciliation of GAAP to Non-GAAP Measures in 000s Revenue Change in deferred revenue Collections in 000s Net cash provided by operating activities Capital expenditures, net Free Cash Flow Full Year 2016 2014 2015 2017 2018 $141,841 $203,518 $290,103 $425,636 $603,704 $29,414 $38,169 $51,966 $58,353 $54,681 $171,255 $241,687 $342,069 $483,989 $658,385 Full Year 2014 2015 2016 2017 2018 ($803) $20,876 $40,573 $83,052 $115,709 ($5,619) ($6,342) ($4,415) ($12,369) ($14,076) ($6,422) $14,534 $36,158 $70,683 $101,633 Note: non-GAAP items exclude the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs, and acquisition-related expense; 2018 based on ASC 606 19#20Reconciliation of GAAP to Non-GAAP Measures in 000s Revenue Change in deferred revenue Collections in 000s GAAP Gross Profit Share Based Compensation Amortization Acquisition Related Expenses Non-GAAP Gross Profit Non-GAAP Gross Margin % 2016 Q4 Q1 Q2 Q3 $61,586 $68,730 $75,611 $84,176 $14,108 $12,723 $11,659 $13,476 $75,694 $81,453 $87,270 $97,652 2016 2017 Q1 Q4 Q2 Q3 $92,538 $103,522 $111,031 $118,545 $22,008 $13,599 $9,088 $13,658 $114,546 $117,121 $120,119 $132,203 2017 Q4 Q1 Q2 $51,079 $57,712 $64,587 $71,438 $466 $429 $428 $475 Q1 Q2 Q3 Q4 $77,675 $85,497 $92,204 $100,869 $506 $695 $783 $946 $0 $1,040 $757 ($1,292) $0 $0 $0 $0 $28 $0 $0 $0 $51,507 $58,187 $65,053 $71,867 $78,209 $87,232 $93,744 $100,523 84% 85% 84% $0 $0 $0 $0 86% 85% 85% 84% 85% 2018 Q4 Q1 Q2 Q3 $137,775 $146,132 $155,600 $164,197 $21,880 $13,763 $7,177 $11,861 $159,655 $159,895 $162,777 $176,058 2018 Q4 $129,708 $1,150 Q1 Q2 Q3 $108,731 $115,695 $122,623 $1,079 $1,087 $1,102 $142 $142 $142 $142 $0 $0 $0 $0 $109,952 $116,924 $123,867 $131,000 80% 80% 80% 80% Note: non-GAAP items exclude the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs, and acquisition-related expense; 2018 based on ASC 606 20#21Reconciliation of GAAP to Non-GAAP Measures in 000s Research and development (GAAP) Share Based Compensation Amortization Aquisition related expenses Non-GAAP research and development % of collections Selling and marketing (GAAP) Share Based Compensation Amortization Aquisition related expenses Non-GAAP selling and marketing % of collections General and administrative (GAAP) Share Based Compensation Acquisition related expenses Non-GAAP general and administrative % of collections 2016 Q1 Q2 Q3 Q4 $24,472 $25,483 $26,536 $28,877 $3,111 $3,558 $3,718 $137 $1,183 $20,041 26% $4,156 $136 $138 $136 $397 $514 $614 $21,392 $22,166 $23,971 26% 25% 25% $40,454 $981 $50 $36,026 $40,010 $40,022 $1,122 $1,237 $1,213 $50 $50 $50 $0 $0 $0 $0 $39,423 $34,854 $38,723 $38,759 52% 43% 44% 40% $5,921 $1,617 $0 $4,304 6% $6,693 $7,073 $7,281 $1,772 $1,743 $2,022 $0 $0 $0 $4,921 $5,330 $5,259 6% 6% 5% 2017 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 $32,669 $36,749 $40,252 $43,965 $46,502 $48,492 $49,360 $54,558 $4,726 $6,586 $7,190 $7,725 $136 $138 $136 $136 $1,713 $860 $889 $2,107 $26,094 $29,165 $32,037 $33,997 23% 25% 27% 26% $8,485 $9,470 $10,372 $11,090 $137 $136 $137 $136 $1,095 $1,084 $261 $125 $36,785 $37,802 $38,590 $43,207 23% 24% 24% 25% $54,329 $48,016 $51,184 $50,906 $1,419 $1,778 $1,826 $1,562 $50 $62 $55 $1,535 $611 $0 $0 $496 $52,249 $46,176 $49,303 $47,313 46% 39% 41% 36% 2018 $11,148 $11,295 $12,222 $13,521 $2,331 $2,920 $3,236 $3,471 $1,413 $0 $0 $540 $7,404 $8,375 $8,986 $9,510 6% 7% 7% 7% $67,011 $58,855 $62,247 $2,042 $2,352 $2,597 $309 $453 $454 $237 ($138) $0 $64,423 $56,188 $59,196 40% 35% 36% $61,065 $2,779 $454 $0 $57,832 33% $13,670 $14,855 $14,514 $16,258 $4,068 $4,860 $4,689 $5,108 $96 $0 $0 $0 $9,506 $9,995 $9,825 $11,150 6% 6% 6% 6% Note: non-GAAP items exclude the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs, and acquisition-related expense; 2018 based on ASC 606 21#22Reconciliation of GAAP to Non-GAAP Measures in 000s GAAP Operating Loss Share Based Compensation Amortization Acquisition Related Expenses Non-GAAP Operating Income (Loss) in 000s GAAP Net Loss Share Based Compensation & Other Non- GAAP Adjustments Non-GAAP Net Income (Loss) in 000s Net cash provided by operating activities Capital expenditures, net Free Cash Flow 2016 Q1 Q4 Q2 Q3 ($19,768) ($10,490) ($9,032) ($4,742) $6,137 $6,927 $7,164 $7,820 $187 $186 $188 $186 $1,183 $397 $514 $614 ($12,261) ($2,980) ($1,166) $3,878 2016 Q1 Q2 Q3 Q4 ($19,912) ($11,420) ($9,643) ($5,921) $7,682 $7,707 $8,074 $8,878 ($12,230) ($3,713) ($1,569) $2,957 2016 2017 Q3 Q4 Q1 Q2 ($20,471) ($10,563) ($11,454) ($7,523) $8,982 $11,979 $13,035 $13,704 $186 $1,240 $948 $379 $3,765 $860 $889 $3,143 ($7,538) $3,516 $3,418 $9,703 2017 Q1 Q2 Q3 Q4 ($20,885) ($14,264) ($14,519) ($6,605) $12,933 $14,079 $14,872 $13,840 ($7,952) ($185) $353 $7,235 2017 2018 Q1 Q3 Q2 ($18,452) ($6,507) ($3,498) Q4 ($2,173) $15,674 $17,769 $18,760 $20,127 $588 $731 $733 $732 $1,428 $946 $261 ($762) $12,939 $16,256 $125 $18,811 2018 Q1 Q2 Q3 Q4 ($19,811) ($5,640) ($5,916) ($5,753) $17,690 $19,446 $24,719 $26,523 ($2,121) $13,806 $18,803 $20,770 2018 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 ($925) $11,314 $10,470 $19,714 $16,397 $19,651 $22,063 $24,941 $24,779 $27,268 $27,607 $36,055 ($1,209) ($1,129) ($1,046) ($1,031) ($1,616) ($2,239) ($3,128) ($5,386) ($3,358) ($3,411) ($3,916) ($3,391) ($2,134) $10,185 $9,424 $18,683 $14,781 $17,412 $18,935 $19,555 $21,421 $23,857 $23,691 $32,664 Note: non-GAAP items exclude the impact of share-based compensation expense, amortization, amortization of debt discount and debt issuance costs, and acquisition-related expense; 2018 based on ASC 606 22