Wix revenue soars but stock plummets

Stock trades lower after first quarter report.

Website creator Wix (NASDAQ: WIX) reported strong growth and a narrower loss than expected in the first quarter of this year, but its stock is off 15% in trading today.

Revenue in Q1 was $304.1 million, up 41% year over year. Collections (sales) clocked in at $351.1 million, also up 40% year over year.

Wix breaks its revenue into two categories: creative subscriptions, which is basically its website builder product, and business solutions, which includes add-ons such as communications tools, payment services, and marketing products.

Creative made up the bulk of revenue in Q1 ($226.4 million) but grew at 28%, compared to 97% growth for business solutions.

While Wix and other web presence companies benefited from businesses going online during the pandemic, the company also thinks it can capture upside as the pandemic wanes. It noted that over 40% of the gross payment volume it handled in Q1 was from non-retail store businesses such as restaurants, fitness, beauty, and events.

For the second quarter, Wix anticipates year-over-year revenue growth of 30%-32% and collections growth of 29%-32%. It nudged up its full-year guidance for revenue and collections but slightly reduced its expected free cash flow range for the year.

Conspicuously absent from this quarter’s report is data on the number of new registrations and net paying subscribers, a metric included in previous quarterly press releases.

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