Wix Reports 2nd Quarter 2022 Results.

NEW YORK: Wix.com Ltd. (Nasdaq: WIX) today reported financial results for the second quarter ended June 30, 2022. In addition, the Company provided its initial outlook for the third quarter. Please visit the Wix Investor Relations website at https://investors.wix.com/ to view the Q2'22 Shareholder Update and other materials.

"We are pleased with our fundamental business improvement this quarter as Wix continues to be the go-to platform for any type of user and any type of business globally," said Avishai Abrahami, Wix Co-founder and CEO. "The strong results of our growth initiatives continue. Despite the current macroeconomic environment, we are focused on what is under our control -- driving operational efficiencies to accelerate our path to profitability while continuing to execute on growth initiatives, such as launching the new Wix Editor this quarter. We remain committed to executing on our three-year financial plan, enhancing our differentiated business model and delivering innovative capabilities for our users to drive shareholder value."

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."

Cost reduction plan

As part of our commitment to execute on the three-year plan and achieve the free cash flow targets introduced at our Analyst Day in May, today we are announcing a set of comprehensive cost reduction measures that will result in approximately $150 million of annualized cost savings. These savings are not one-time in nature and will continue to be realized on a run-rate basis. Approximately 20% of the annualized savings are expected to be realized already in 2022. Further, these cost savings do not include any reduction to our user acquisition marketing investments that we adjust to match our TROI thresholds, which we have not changed.

We expect that these reductions in our cost structure will result in free cash flow as a percentage of revenue (excluding headquarters capital expenditures) to be in line with our three-year plan and accelerate margin...