Wix Is One Of The Best Product-Driven Growth Stories, Analyst Says

Wall Street analysts rerated Wix.com Ltd WIX after the company reported its fourth-quarter results Wednesday amid an exciting earnings season.

Wix.com reported revenue growth of 14% to $460.46 million, missing the analyst estimate of $461.75 million. Adjusted EPS of $1.93 beat the consensus estimate of $1.59.

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Cantor Fitzgerald analyst Deepak Mathivanan maintained Wix.com with an Overweight and raised the price target from $260 to $270.

Benchmark analyst Mark Zgutowicz reiterated Wix.com with a Buy and raised the price target from $250 to $260.

Needham analyst Bernie McTernan maintained Wix.com with a Buy and raised the price target from $235 to $250.

RBC Capital analyst Brad Erickson reiterated an Outperform on Wix.com with a price target of $245.

Cantor Fitzgerald: WIX reported fourth-quarter results with revenue in line and free cash flow above Street estimates by 2% (Visible Alpha).

Mathivanan highlighted Studio adoption reflected by its booking growth, momentum in Self Create supported by the rollout of new AI products—the company’s AI marketing agent has entered the rollout phase—and premium subscriptions led by pricing initiatives and tougher comp from B2B migrations in 2023.

The analyst noted that the company’s robust product pipeline in 2025 bodes well for top-line growth. Operating margins also have plenty of runway to expand nicely over the next few quarters. Mathivanan projected first-quarter revenue of $472.1 million and adjusted EPS of $1.30.

Benchmark: WIX’s first-quarter and fiscal 2025 outlook tempered concerns for difficult pricing-related bookings headwind comparisons starting in mid-first-quarter, as the entirety of the respective fiscal 2025 bookings and revenue miss were attributed to FX headwinds.

Notably, WIX’s fiscal 2025 free cash flow guidance incorporates adjusted opex as a percent of revenue between 47% and 48%, in line with targets set at its fiscal 2023 Investor Day.

Importantly, WIX has not assumed any revenue generation from new products within fiscal 2025 guidance, presenting a potential average revenue per subscription (ARPS) catalyst in the second half across both Self-Creators and Partners.

An underappreciated aspect of the free cash flow margin story remains the sustainable and eventually accretive revenue mix shift toward Partners. Notably, partners’ revenue exhibits lower S&M sensitivities than Self-Creator today, allowing rationalize Partners’ (eventual) accretion potential and emerging automation-based efficiencies.

Regarding WIX’s top-of-funnel momentum, Zgutowicz is impressed with 75% of the 2M Studio account net adds since launch being net new Partner clients to WIX. Zgutowicz anticipated potential top-of-funnel Partner (Agency) deceleration, given difficult comparisons.

However, the analyst expects Studio to drive accelerative ARPS growth in the second half as Bookings materialize into revenue. Zgutowicz anticipates its new Partner subscribers will deliberately shift portions of workflow to Studio, providing a sustainable ARPS benefit over the medium-to-long term, with pricing power and product innovation at its disposal. Zgutowicz projected first-quarter revenue of $472 million.

Needham: WIX continues to be one of the best product-driven growth stories in McTernan’s coverage. However, the company’s reported fiscal 2025 growth is being impacted by FX and compared against a price increase from the prior year. WIX studio is driving many new developers/agencies to the platform, which should be of lasting benefit.

On Self Creator, WIX is launching new products this year, which could re-accelerate revenue to double-digits, representing an upside to the analyst’s estimates. McTernan projected first-quarter revenue of $471 million and adjusted EPS of $1.73.

RBC Capital: WIX’s fourth-quarter print was somewhat mixed, with the main intrigue being the fiscal bookings guide below Street (in-line FX neutral), where expected second-half bookings acceleration implies the year will be more back-end weighted than Street forecasts.

Erickson rerated despite the stock’s firm run on further new product cycle optimism and rising potential to become a more fully-formed compounder/capital return story. Erickson projected first-quarter revenue of $471.2 million.

Price Action: WIX stock traded lower by 4.82% at $206.54 at last check Thursday.

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