Wix.com Beats Q2 Revenue Amid Continued Market Volatility; Cuts FY22 Outlook

Wix.com Ltd WIX reported second-quarter FY22 revenue growth of 9% year-on-year to $345.2 million, beating the consensus of $344.4 million.
Segments: Creative Subscription revenue increased 9% Y/Y to $258.2 million. The Creative Subscriptions bookings climbed 3% Y/Y to $269.9 million.
Creative Subscriptions ARR was $1.05 billion, up 9% Y/Y.
Business Solutions' revenue rose 9% to $87 million, and the bookings jumped 6% Y/Y to $84.7 million.
The non-GAAP gross margin contracted 100 bps to 62% as costs surged 11.5% Y/Y.
Non-GAAP EPS loss was $(0.14) versus $(0.28) a year ago.
Wix.com used $(2.7) million in operating cash flow and held $1.2 billion in cash and equivalents.
Lior Shemesh, CFO at Wix, added, "Our results this quarter reflect continued market-wide volatility. We are executing on the three-year plan we shared in May and are undertaking a cost reduction plan that we expect will save approximately $150 million in annualized expenses. These cost reduction measures are expected to accelerate expansion of our gross margin and operating margin as well as help us achieve our free cash flow target as presented in our three-year plan even if market conditions continue to be challenged in 2023."
Outlook: Wix.com sees Q3 revenue to grow 7% - 8% Y/Y to $341 million - $345 million (consensus $354.53 million). The company cut the FY22 revenue growth rate to 8% - 10% Y/Y from 10% - 13% Y/Y.
Price Action: WIX shares closed lower by 5.12% at $68.77 on Tuesday.

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