Wix Results Presentation Deck

increasing efficiency of our direct response advertising, increased brand awareness and the continued improvement in our product. Non-GAAP S&M expense was $151.8 million in 2016, or 44% of collections, compared to $116.7 million in 2015, or 48% of collections. S&M expense grew 30% year over year, but our efficiency improved as we generated positive incremental margin on the additional investment and ended within our previously provided guidance range. We continue to effectively leverage technology to execute our marketing strategy and are progressing very well towards our long-term target of S&M at 30% of collections. Non-GAAP G&A expense was $5.3 million in Q4 compared to $3.7 million last year. For 2016, non-GAAP G&A increased to $19.8 million from $14.5 million in 2015 due to increased headcount and other costs related to the growth of the company. Q4 was a milestone for the company as we generated our first profit with non- GAAP operating income of $3.6 million compared to a loss of $4.4 million last year. The stronger than expected inflection to non-GAAP operating profitability versus our prior outlook to be approximately breakeven during the quarter highlights the incredible flexibility and scalability of our low, fixed-cost model. Adjusted EBITDA was $17.9 million, up from $7.0 million in the same quarter a year ago and well above our prior record of $11.4 million set in Q3 2016. Q4 was our highest ever sequential increase in Adjusted EBITDA. As a percent of collections, our Adjusted EBITDA margin was 18% in Q4 compared to 13% last quarter. Our performance this quarter once again exceeded the high end of our guidance range as it has in each quarter since we became a public company. For the full year 2016, Adjusted EBITDA was up 189% year over year to $42.6 million compared to $14.7 million in the year ago quarter. As a reminder, this is the last time we will refer to Adjusted EBITDA as a non-GAAP metric. - 6- ($4.9) Q3'15 $4.7 $5.4 Non-GAAP Operting Loss (in $ Mn) Q3'15 ($4.4) Q3'15 Q4'15 $7.0 Q4'15 Q1'16 Q2'16 Q3'16 ($12.3) Adjusted EBITDA (in $ Mn) $8.4 ($3.0) Q4'15 ($1.2) $10.7 ($2.1) Free Cash Flow (in $ Mn) $11.4 $10.2 $2.7 Q1'16 Q2'16 Q3'16 Q4'16 $3.6 $9.4 Q4'16 $17.9 $18.7 Q1'16 Q2'16 Q3'16 Q4'16 WIX.com

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