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 attract and retain registered users and partners, and generate new premium subscriptions and additional business solutions as we continuously adjust our marketing strategy and customer care; maintenance of our brand and reputation, and generation of revenue from sources other than premium subscriptions; risks associated with international operations and the use of platform in various countries; risks related to the macroeconomic environment and ongoing global conflicts; security risks and payment risks and fluctuations in foreign currency exchange rates; failures of third-party hardware, software and infrastructure on which we rely, or failure to manage the operation of our infrastructure; adverse market conditions, including inflation, interest rates and other adverse developments that may adversely affect our cash balances and investment portfolio; our history of operating losses and inability to achieve sustained profitability; downturns or upturns in sales are not immediately reflected in full in our operating results; our ability to repurchase our ordinary shares and/or 0.00% Convertible Senior Notes due 2025 pursuant to our repurchase program; our ability to raise capital when needed or on acceptable terms; risks related to acquisitions and investments, pricing decisions, pandemics, natural disasters and other catastrophic events; our ability to develop and introduce new products and services, as well as maintain third-party products and are ability to keep up with rapid changes in design and technology; our ability to attract and retain qualified employees and key personnel; our ability to attract a diversified customer base and increased competition; our ability to maintain compatibility of our platform and solutions with changes in third-party applications and changes to technologies used in our solutions; our ability to acquire and service small business users; risks related to security breaches and unauthorized access to data, cyberattacks; our expectation regarding the uncertain future relationship between the United States and other countries with respect to trade policies, taxes, government regulations, and tariffs; our ability to comply with the regulations applicable to our operations, including new governmental regulations regarding the internet, consumer protection, artificial intelligence ("AI”), privacy and data protection laws and regulations, as well as contractual privacy and data protection obligations; risks relating to intellectual property, including infringements, litigation and claims, and our ability to maintain and protect our intellectual property rights and proprietary information; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; risks related to the development and integration of AI, generative AI, agentic AI, machine learning, and similar tools into our offerings, and comply with the regulatory environment impacting AI and AI-related activities; risks related to activities of registered users or content of their websites, and risks related to domain names and industry regulations; risks related to compliance with laws and regulations, including those related to economic sanctions, tariffs, export controls, anti-corruption and anti-money laundering, anti-trust, and consumer protection, and changes in these laws and regulations; risks related to tax, including application of indirect taxes, tax laws, changes in tax laws or changes in provision for income tax and examination of income tax returns; risks related to ordinary shares, activist shareholders, and our status as a foreign private issuer; risks related to our incorporation and location in Israel, including conflicts in the area; 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; 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; and our ability to enter into new markets and attracting new customer demographics, including our ability to successfully attract new partners and 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, 2024 filed with the Securities and Exchange Commission on March 21, 2025.
Durability was broad based across our segments with our Partners business delivering 24% y/y revenue growth, fueled by ongoing market share gains driven by Studio, as well as another consecutive quarter of Self Creators growth acceleration as AI continued to remove friction for more users in the website creation journey.” Q1 2025 Financial Results Total revenue in the first quarter of 2025 was $473.7 million, up 13% y/yCreative Subscriptions revenue in the first quarter of 2025 was $337.7 million, up 11% y/y Creative Subscriptions ARR increased to $1.373 billion as of the end of the quarter, up 10% y/y Business Solutions revenue in the first quarter of 2025 was $136.0 million, up 18% y/y Transaction revenue2 was $58.9 million, up 19% y/y Partners revenue3 in the first quarter of 2025 was $171.6 million, up 24% y/yTotal bookings in the first quarter of 2025 were $510.9 million, up 12% y/y Creative Subscriptions bookings in the first quarter of 2025 were $369.5 million, up 10% y/yBusiness Solutions bookings in the first quarter of 2025 were $141.4 million, up 15% y/y Total gross margin on a GAAP basis in the first quarter of 2025 was 68% Creative Subscriptions gross margin on a GAAP basis was 83%Business Solutions gross margin on a GAAP basis was 30% Total non-GAAP gross margin in the first quarter of 2025 was 69% Creative Subscriptions gross margin on a non-GAAP basis was 84%Business Solutions gross margin on a non-GAAP basis was 31% GAAP net income in the first quarter of 2025 was $33.8 million, or $0.61 per basic share and $0.57 per diluted shareNon-GAAP net income in the first quarter of 2025 was $93.9 million, or $1.69 per basic share and $1.55 per diluted shareNet cash provided by operating activities for the first quarter of 2025 was $145.5 million, while capital expenditures totaled $3.1 million, leading to free cash flow of $142.4 millionIn January, we completed $200 million of share repurchases, repurchasing 868,026 Wix ordinary shares in total at an approximate volume-weighted average price per share of $230.41Total employee count at the end of Q1’25 was 5,275 Increase to Share Repurchase Program Wix’s Board of Directors has authorized an increase to its program to repurchase the Company's securities (ordinary shares and/or convertible notes) by an additional amount of up to $200 million, on top of the $200 million previously approved by the Board on February 26th, 2025 (which has not been used to date).
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(In thousands) Three Months Ended March 31, 2025 2024 (unaudited)OPERATING ACTIVITIES: Net income$33,766 $24,002 Adjustments to reconcile net loss to net cash provided by operating activities: Depreciation 6,137 6,442 Amortization 1,461 1,483 Share based compensation expenses 60,261 58,142 Amortization of debt discount and debt issuance costs 794 790 Changes in accrued interest and exchange rate on short term and long term deposits (224) 880 Amortization of premium and discount and accrued interest on marketable securities, net 3,557 597 Remeasurement loss (gain) on Marketable equity - (3,367)Changes in deferred income taxes, net 1 (5,011)Changes in operating lease right-of-use assets 4,803 5,024 Changes in operating lease liabilities (8,763) (3,652)Loss (gain) on foreign exchange, net (2,006) 553 Decrease (increase) in trade receivables (2,654) 1,119 Decrease (increase) in prepaid expenses and other current and long-term assets 58,289 (12,568)Decrease in trade payables (9,338) (2,123) Decrease in employees and payroll accruals (64,148) (2,429) Increase in short term and long term deferred revenues 44,362 41,319 Increase in accrued expenses and other current liabilities 19,193 2,635 Net cash provided by operating activities$145,491 113,836 INVESTING ACTIVITIES: Proceeds from short-term deposits and restricted deposits 107,780 823 Investment in short-term deposits and restricted deposits (112,810) (30,162)Investment in marketable securities (27,693) (27,847)Proceeds from marketable securities 58,292 52,805 Purchase of property and equipment and lease prepayment (2,629) (7,715)Capitalization of internal use of software (421) (410)Proceeds from sale of equity securities - 22,148 Proceed from realization of investments in privately held companies 417 - Purchases of investments in privately held companies (750) (550) Net cash provided by investing activities$22,186 9,092 FINANCING ACTIVITIES: Proceeds from exercise of options and ESPP shares 22,654 22,628 Purchase of treasury stock (200,000) (241,302) Net cash used in financing activities$(177,346) (218,674)Effect of exchange rates on cash, cash equivalent and restricted cash 2,006 (553) DECREASE IN CASH AND CASH EQUIVALENTS (7,663) (96,299) CASH AND CASH EQUIVALENTS—Beginning of period 660,939 609,622 CASH AND CASH EQUIVALENTS—End of period$653,276 $513,323 Wix.com Ltd.
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