Wix Reports Strong Third Quarter 2017 Results Above Expectations; Record Level of Conversion Driven by Product Enhancements

NEW YORK, Nov. 8, 2017 /PRNewswire/ -- Wix.com Ltd. (Nasdaq: WIX), a leading cloud-based web development platform, today reported financial results for the third quarter ended September 30, 2017, which exceeded the high end of guidance. Wix also increased its outlook for the full year 2017 following these strong results.

"New product releases and continued improvements to existing products drove increases in conversion to the highest levels ever, leading to strong results this quarter," said Avishai Abrahami, Co-founder and CEO of Wix. "Most notably, ongoing development of the Wix Editor and Wix ADI contributed meaningfully to conversion improvements. With future improvements to and the localization of Wix ADI, the continued development of the Wix Editor and the upcoming public release of Wix Code, we have built a complete web development platform for any type of user that will continue to drive growth in our business."

Lior Shemesh, CFO of Wix, added, "Revenue and collections exceeded our expectations in Q3 due to improvements in the conversion of registered users to premium subscriptions throughout the quarter. We also continued to gain operating leverage in our model, driving meaningfully increased free cash flow on a year over year basis. We are raising our financial outlook for the remainder of 2017 as we expect the drivers of these strong results to continue."

Q3 2017 Financial Summary


                                                               Three months ended

                                                                 September 30,
                                                                 -------------

                                              $ in thousands      2017          2016 Y/Y growth           Prior Q3 2017
                                                                                                           Outlook
                                                                                                           -------

    Revenue                                                   $111,031       $75,611             47%   $109,000 - 110,000

    Collections                                               $120,119       $87,270             38%   $117,000 - 118,000
                                                                                                     ------------------

    Operating Income (Loss)                                  $(11,454)     $(9,032)    NM

    Non-GAAP Operating Income (Loss)                            $3,418      $(1,166)    NM

                                                               $22,063       $10,470            111%
    Net Cash Provided by Operating Activities

    Free Cash Flow                                             $18,935        $9,424            101%

Additional Q3 2017 Results and Highlights

    --  Gross margin on a GAAP basis was 83%, compared to 85% in the third
        quarter of last year
    --  Non-GAAP gross margin, calculated as non-GAAP gross profit as a percent
        of revenue, was 84%, compared to 86% in the third quarter of last year.
        Non-GAAP gross margin represents GAAP gross profit adjusted for the
        impact of share-based compensation expense, acquisition-related costs
        and amortization, divided by revenue
    --  GAAP net loss was $(14.5) million, or $(0.32) per share, compared to a
        net loss of $(9.6) million, or $(0.23) per share for the third quarter
        of 2016
    --  Non-GAAP net income was $0.4 million, or $0.01 per share, compared to a
        non-GAAP net loss of $(1.6) million, or $(0.04) per share for the third
        quarter of 2016
    --  Net cash provided by operating activities for the third quarter of 2017
        was $22.1 million, while capital expenditures totaled $3.1 million,
        leading to free cash flow of $18.9 million, compared to $9.4 million in
        the third quarter of last year, a 101% year over year increase
    --  Added 188,000 net premium subscriptions in the period to reach 3.1
        million as of September 30, 2017, a 33% increase over the third quarter
        of 2016
    --  Added 5.2 million registered users in the third quarter. Registered
        users as of September 30, 2017 were 114 million, representing a 23%
        increase compared to the end of the third quarter of 2016

Recent Business Highlights

    --  Addition of Wix ADI has driven significant increases in conversion: A
        year since the release of Wix ADI, results show that adding ADI to our
        platform has had a material impact on our conversion of registered users
        to paid subscriptions. To date, millions of websites have been created
        using ADI leading to significant incremental contribution of future
        collections to our user cohorts.
    --  Launched partnership with Clube de Regatas do Flamengo: Wix launched an
        official partnership with top-tier Brazilian soccer team Clube de
        Regatas do Flamengo. As part of the agreement, Wix will serve as the
        official website design and hosting partner of Clube de Regatas do
        Flamengo. The partnership will also feature promotional activities with
        some of Flamengo's first team players.
    --  Announced integration with Photos in Apple's macOS High Sierra: Wix
        announced its integration with Photos as part of the macOS High Sierra
        release. The integration enables Mac users to create stunning Wix online
        photo albums with just a few clicks, directly within Apple's Photos app.
    --  Wix Mobile Growth: Wix users have created 30 million mobile sites to
        date, making Wix one of the largest mobile site development platforms
        globally.
    --  Global E-commerce Platform: E-commerce subscriptions reached over
        417,000 during the quarter. Growth of e-commerce and other vertical
        application subscriptions continues to exceed overall subscriptions
        growth and accelerated during the quarter, highlighting Wix's broad
        reach with small businesses.
    --  Desktop and Mobile Business Management and Growth Solutions: Continued
        engagement with the Wix ecosystem is illustrated by over 669 million
        user contacts saved onto the Wix platform by our users. Leveraging Wix's
        CRM system on the desktop and the Wix App on mobile devices, business
        owners can track their customer activity data, manage relationships,
        communicate using Wix Engage, get paid via Wix Invoices and launch
        marketing campaigns and newsletters via Wix ShoutOut, our email
        marketing solution, from a single location, anywhere.

Financial Outlook

The Company is introducing its outlook for the fourth quarter of 2017 as follows:


                 Q4 2017 Outlook    Y/Y growth
                 ---------------    ----------

    Revenue      $116- $117 million       38% - 39%

    Collections $126 - $127 million       29% - 30%

Wix is increasing its outlook for the full year 2017 following the third quarter results:


                     FY 2017 Outlook

                          Prior            Updated         Y/Y growth
                          -----            -------         ----------

    Revenue        $421 - $423 million $423 - $424 million             46%

    Collections    $473 - $477 million $478 - $479 million             40%

    Free Cash Flow    $67 - 68 million    $68 - 69 million       88% - 91%

Conference Call and Webcast Information

Wix will host a conference call at 8:30 a.m. ET on Wednesday, November 8, 2017 to answer questions about the financial and operational performance of the business during the third quarter 2017. The conference call will include a brief statement by management and will focus on answering questions about our results during the quarter. To enhance the Q&A portion of this call, the company has posted a shareholder update and supporting slides to its Investor Relations website at https://investors.wix.com/results. These materials provide shareholders and analysts with additional detail for analyzing results in advance of the quarterly conference call.

To participate on the live call, analysts and investors should dial 866-393-4306 (US/Canada), 734-385-2616 (International) or 1-809-315-362 (Israel) at least ten minutes prior to the start time of the call and reference Conference ID 97473958. A telephonic replay of the call will be available through November 15, 2017 at 11:59 p.m. ET by dialing 855-859-2056 (US/Canada) or 404-537-3406 (International) and providing Conference ID 97473958.

Wix will also offer a live and archived webcast of the conference call, accessible from the "Investor Relations" section of the Company's website at https://investors.wix.com/.

About Wix.com Ltd.

Wix is leading the way with a cloud-based development platform for over 116 million registered users worldwide. Wix was founded on the belief that the Internet should be accessible to everyone to develop, create and contribute. Through free and premium subscriptions, Wix empowers millions of businesses, organizations, artists, and individuals to take their businesses, brands and workflow online. The Wix Editor, Wix ADI, a highly curated App Market, and Wix Code enable users to build and manage a fully integrated and dynamic digital presence. Wix's headquarters are in Tel Aviv with offices in Be'er Sheva, Berlin, Dnipro, Kiev, Los Angeles, Miami, New York, San Francisco, São Paulo and Vilnius.

Visit us: on our blog, Facebook, Twitter, Instagram, LinkedIn, Pinterest and Google+

Download: Wix App is available for free on Google Play and in the App Store

Non-GAAP Financial Measures

To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, Wix uses the following non-GAAP financial measures: collections, non-GAAP gross margin, non-GAAP operating income (loss), free cash flow, non-GAAP net income (loss) and non-GAAP net income (loss) per share (collectively the "Non-GAAP financial measures"). Collections represents the total cash collected by us from our customers in a given period and is calculated by adding the change in deferred revenues for a particular period to revenues for the same period. Non-GAAP gross margin represents gross profit calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related costs and amortization, divided by revenue. Non-GAAP operating income (loss) represents operating income (loss) calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, and acquisition-related costs. Non-GAAP net income (loss) represents net loss calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, and acquisition-related costs. Non-GAAP net income (loss) per share represents non-GAAP net income (loss) divided by the weighted average number of shares used in computing GAAP loss per share. Free cash flow represents net cash provided by (used in) operating activities less capital expenditures.

The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

For more information on the non-GAAP financial measures, please see the "Reconciliation of GAAP to Non-GAAP Financial Measures" table in this press release. This accompanying table has more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company has not reconciled its guidance as to free cash flow to cash flow from operations because it does not provide guidance for cash flow from operations. As items that impact cash flow from operations are out of the Company's control and/or cannot be reasonably predicted, the Company is unable to provide such guidance. Accordingly, a reconciliation to cash flow from operations is not available without unreasonable effort.

Forward-Looking Statements

This press release contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include projections regarding our future performance, including, but not limited to revenue, collections and free cash flow, the availability, merchantability or functionality of certain new products or features and their anticipated product demand and customer satisfaction, and may be identified by words like "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "outlook," "future," "will," "seek" and similar terms or phrases. The forward-looking statements contained in this press release are based on management's current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. 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 grow our user base and premium subscriptions; our ability to maintain and enhance our brand and reputation; our ability to manage the growth of our infrastructure effectively; our ability to effectively execute our initiatives to scale and improve our user support function; customer acceptance of new products and other challenges inherent in new product development, changes to technologies used in our solutions or in global, national, regional or local economic, business, competitive, market, regulatory and other factors discussed under the heading "Risk Factors" in the Company's 2016 annual report on Form 20-F filed with the Securities and Exchange Commission on March 28, 2017. Any forward-looking statement made by us in this press release speaks only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.

Investor Relations:
Maggie O'Donnell
ir@wix.com
415-223-2624

Media Relations:
Vivian Hernandez
Wix.com
pr@wix.com
415-517-6539


                                                                        Wix.com Ltd.

                                                            CONDENSED CONSOLIDATED BALANCE SHEET

                                                                       (In thousands)


                                                                                                 Period ended

                                                                                                 December 31,           September 30,
                                                                                                 ------------           -------------

                                                                                                                   2016                     2017
                                                                                                                   ----                     ----

    Assets                                                                                         (audited)             (unaudited)

    Current Assets:

          Cash and cash equivalents                                                                             $93,064                 $123,903

          Short term deposits                                                                                    78,240                   84,800

          Restricted cash and deposit                                                                               931                      949

          Trade receivables                                                                                       8,279                   11,538

          Prepaid expenses and other current assets                                                              17,346                   21,939

     Total current assets                                                                                       197,860                  243,129
                                                                                                                -------                  -------

    Property, equipment and software, net

    Long-Term Assets:

          Property and equipment, net                                                                             8,750                   12,612

          Prepaid expenses and other long-term assets                                                             2,622                    3,012

          Intangible assets and goodwill, net                                                                     5,452                   48,423

     Total long-term assets                                                                                      16,824                   64,047
                                                                                                                 ------                   ------


     Total assets                                                                                              $214,684                 $307,176
                                                                                                               ========                 ========


    Liabilities and Shareholder's Deficiency

    Current Liabilities:

          Trade payables                                                                                        $20,709                  $41,622

          Employees and payroll accruals                                                                         20,230                   22,987

          Deferred revenues                                                                                     146,987                  190,082

          Accrued expenses and other current liabilities                                                         18,847                   28,407

    Total current liabilities                                                                                   206,773                  283,098
                                                                                                                -------                  -------


          Long term deferred revenues                                                                             9,746                   14,012

          Long term deferred tax liability                                                                          634                    4,467

          Long-term loan                                                                                              -                   1,219

    Total long-term liabilities                                                                                  10,380                   19,698
                                                                                                                 ------                   ------


     Total liabilities                                                                                          217,153                  302,796
                                                                                                                -------                  -------


    Shareholders'  Equity (Deficiency)

          Ordinary shares                                                                                            74                       74

          Additional paid-in capital                                                                            241,154                  295,720

          Other comprehensive income (loss)                                                                       (389)                   1,562

          Accumulated deficit                                                                                 (243,308)               (292,976)

    Total shareholders' equity (deficiency)                                                                     (2,469)                   4,380
                                                                                                                 ------                    -----


    Total liabilities and shareholders' equity (deficiency)                                                    $214,684                 $307,176
                                                                                                               ========                 ========


                                                                                                                          Wix.com Ltd.

                                                                                                          CONSOLIDATED STATEMENTS OF OPERATIONS - GAAP

                                                                                                           (In thousands, except loss per share data)



                                                                                                                                                                                  Three Months Ended

                                                                                                                                                                                  September 30,
                                                                                                                                                                                  -------------

                                                                                                                                                                                         2016              2017
                                                                                                                                                                                         ----              ----

                                                                                                                                                                                   (unaudited)


    Revenue                                                                                                                                                                           $75,611          $111,031

    Cost of revenue                                                                                                                                                                    11,024            18,827
                                                                                                                                                                                       ------            ------

    Gross Profit                                                                                                                                                                       64,587            92,204


    Operating expenses:

    Research and development                                                                                                                                                           26,536            40,252

    Selling and marketing                                                                                                                                                              40,010            51,184

    General and administrative                                                                                                                                                          7,073            12,222
                                                                                                                                                                                        -----            ------

    Total operating expenses                                                                                                                                                           73,619           103,658
                                                                                                                                                                                       ------           -------

    Operating loss                                                                                                                                                                    (9,032)         (11,454)

    Financial income, net                                                                                                                                                                 297           (1,978)

    Other income (expenses)                                                                                                                                                                 -              (4)
                                                                                                                                                                                          ---              ---

    Loss before taxes on income                                                                                                                                                       (8,735)         (13,436)

    Taxes on income                                                                                                                                                                       908             1,083

    Net loss                                                                                                                                                                         $(9,643)        $(14,519)
                                                                                                                                                                                      =======          ========


    Basic and diluted net loss per share                                                                                                                                              $(0.23)          $(0.32)
                                                                                                                                                                                       ======            ======

    Basic and diluted weighted-average shares used to compute net loss per share                                                                                                   42,678,140        45,843,390
                                                                                                                                                                                   ==========        ==========




                                                                                                                        Wix.com Ltd.

                                                                                       ADJUSTMENTS FOR RECONCILIATION OF GAAP TO NON-GAAP OPERATING LOSS AND NET LOSS

                                                                                                                       (In thousands)



                                                                                                                                                                                Three Months Ended

                                                                                                                                                                                  September 30,
                                                                                                                                                                                  -------------

                                                                                                                                                                                         2016              2017
                                                                                                                                                                                         ----              ----

    (1) Share based compensation expenses:                                                                                                                                         (unaudited)

    Cost of revenues                                                                                                                                                                     $466              $783

    Research and development                                                                                                                                                            3,718             7,190

    Selling and marketing                                                                                                                                                               1,237             1,826

    General and administrative                                                                                                                                                          1,743             3,236

    Total share based compensation expenses                                                                                                                                             7,164            13,035
                                                                                                                                                                                        -----            ------

    (2) Amortization                                                                                                                                                                      188               948

    (3) Acquisition related expenses                                                                                                                                                      514               889

    (4) Taxes on income                                                                                                                                                                   208                 -

    Total adjustments of GAAP to Non GAAP                                                                                                                                              $8,074           $14,872
                                                                                                                                                                                       ======           =======




                                                                                                                        Wix.com Ltd.

                                                                                            RECONCILIATION OF OPERATING LOSS TO NON-GAAP OPERATING INCOME (LOSS)

                                                                                                                       (In thousands)


                                                                                                                                                                                Three Months Ended

                                                                                                                                                                                  September 30,
                                                                                                                                                                                  -------------

                                                                                                                                                                                         2016              2017
                                                                                                                                                                                         ----              ----

                                                                                                                                                                                   (unaudited)

    Operating loss                                                                                                                                                                   $(9,032)        $(11,454)

    Adjustments:

    Share based compensation expenses                                                                                                                                                   7,164            13,035

    Amortization                                                                                                                                                                          188               948

    Acquisition related expenses                                                                                                                                                          514               889

    Total adjustments                                                                                                                                                                  $7,866           $14,872
                                                                                                                                                                                       ------           -------


    Non GAAP operating income (loss)                                                                                                                                                 $(1,166)           $3,418
                                                                                                                                                                                      =======            ======




                                                                                                                        Wix.com Ltd.

                                                                                               ADJUSTMENTS FOR RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT

                                                                                                                       (In thousands)



                                                                                                                                                                                Three Months Ended

                                                                                                                                                                                  September 30,
                                                                                                                                                                                  -------------

                                                                                                                                                                                         2016              2017
                                                                                                                                                                                         ----              ----

                                                                                                                                                                                   (unaudited)

    Gross Profit                                                                                                                                                                      $64,587           $92,204

    Share based compensation expenses                                                                                                                                                     466               783

    Amortization                                                                                                                                                                            -              757

    Acquisition related expenses                                                                                                                                                            -                -

    Non GAAP Gross Profit                                                                                                                                                              65,053            93,744
                                                                                                                                                                                       ------            ------


    Non GAAP Gross margin                                                                                                                                                                 86%              84%




                                                                                                                        Wix.com Ltd.

                                                                              RECONCILIATION OF NET LOSS TO NON-GAAP NET INCOME/(LOSS) AND NON-GAAP NET INCOME/(LOSS) PER SHARE

                                                                                                         (In thousands, except loss per share data)


                                                                                                                                                                                Three Months Ended

                                                                                                                                                                                  September 30,
                                                                                                                                                                                  -------------

                                                                                                                                                                                         2016              2017
                                                                                                                                                                                         ----              ----

                                                                                                                                                                                   (unaudited)

    Net loss                                                                                                                                                                         $(9,643)        $(14,519)

    Share based compensation expense and other Non GAAP adjustments                                                                                                                     8,074            14,872

    Non-GAAP net income/(loss)                                                                                                                                                       $(1,569)             $353
                                                                                                                                                                                      =======              ====


    Basic  Non GAAP net income/(loss) per share                                                                                                                                       $(0.04)            $0.01
                                                                                                                                                                                       ======             =====

    Weighted average shares used in computing basic Non GAAP net income/(loss) per share                                                                                           42,678,140        45,843,390
                                                                                                                                                                                   ==========        ==========


                                                                                                                Wix.com Ltd.

                                                                                                           KEY PERFORMANCE METRICS

                                                                                                               (In thousands)


                                                                                                                                                                                 Three Months Ended

                                                                                                                                                                                   September 30,
                                                                                                                                                                                 -------------

                                                                                                                                                                                        2016                 2017
                                                                                                                                                                                        ----                 ----

                                                                                                                                                                                  (unaudited)

    Revenues                                                                                                                                                                         $75,611             $111,031

    Collections                                                                                                                                                                      $87,270             $120,119

    Free Cash Flow                                                                                                                                                                    $9,424              $18,935

    Number of registered users at period end (*)                                                                                                                                      92,374              113,923

    Number of premium subscriptions at period end (*)                                                                                                                                  2,294                3,053


    (*) the numbers without DeviantArt




                                                                                                              Wix.com Ltd.

                                                                                                RECONCILIATION OF REVENUES TO COLLECTIONS

                                                                                                             (In thousands)


                                                                                                                                                                               Three Months Ended

                                                                                                                                                                                 September 30,
                                                                                                                                                                                 -------------

                                                                                                                                                                                        2016                 2017
                                                                                                                                                                                        ----                 ----

                                                                                                                                                                                  (unaudited)

    Revenues                                                                                                                                                                         $75,611             $111,031

    Change in deferred revenues                                                                                                                                                       11,659                9,088

    Collections                                                                                                                                                                      $87,270             $120,119
                                                                                                                                                                                     =======             ========




                                                                                                              Wix.com Ltd.

                                                                              RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW

                                                                                                             (In thousands)


                                                                                                                                                                               Three Months Ended

                                                                                                                                                                                 September 30,
                                                                                                                                                                                 -------------

                                                                                                                                                                                        2016                 2017
                                                                                                                                                                                        ----                 ----

                                                                                                                                                                                  (unaudited)

    Net cash provided by operating activities                                                                                                                                        $10,470              $22,063

    Capital expenditures, net                                                                                                                                                        (1,046)             (3,128)

    Free Cash Flow                                                                                                                                                                    $9,424              $18,935
                                                                                                                                                                                      ======              =======




                                                                                                              Wix.com Ltd.

                                                          RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW EXCLUDING DEVIANTART ACQUISITION COSTS

                                                                                                             (In thousands)


                                                                                                                                                                               Three Months Ended

                                                                                                                                                                                 September 30,
                                                                                                                                                                                 -------------

                                                                                                                                                                                        2016                 2017
                                                                                                                                                                                        ----                 ----

                                                                                                                                                                                  (unaudited)

    Net cash provided by operating activities                                                                                                                                        $10,470              $22,063

    Capital expenditures, net                                                                                                                                                        (1,046)             (3,128)

    DeviantArt acquisition costs                                                                                                                                                           -                   -

    Free Cash Flow excluding DeviantArt acquisition costs                                                                                                                             $9,424              $18,935
                                                                                                                                                                                      ======              =======




                                                                                                              Wix.com Ltd.

                                                                                      RECONCILIATION OF PROJECTED REVENUES TO PROJECTED COLLECTIONS

                                                                                                             (In thousands)


                                                                                                                                                                               Three Months Ended

                                                                                                                                                                               December 31, 2017
                                                                                                                                                                               -----------------

                                                                                                                                                                                Low                 High
                                                                                                                                                                                ---                 ----


    Projected revenues                                                                                                                                                              $116,000             $117,000

    Projected change in deferred revenues                                                                                                                                            $10,000              $10,000

    Projected collections                                                                                                                                                           $126,000             $127,000
                                                                                                                                                                                    ========             ========


                                                                                                                    Wix.com Ltd.

                                                                                                   CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                                                                                   (In thousands)



                                                                                                                                                   Three Months Ended

                                                                                                                                                    September 30,
                                                                                                                                                    -------------

                                                                                                                                                         2016               2017
                                                                                                                                                         ----               ----

                                                                                                                                                     (unaudited)

    OPERATING ACTIVITIES:

    Net loss                                                                                                                                         $(9,643)         $(14,519)

    Adjustments to reconcile net loss to net cash used in operating activities:

    Depreciation                                                                                                                                        1,198              1,451

    Amortization                                                                                                                                          187                950

    Share based compensation expenses                                                                                                                   7,164             13,035

    Tax benefit related to exercise of share options                                                                                                      208                  -

    Decrease (increase) in accrued interest and exchange rate on short term and long term deposits                                                      (160)                 7

    Deferred income taxes, net                                                                                                                           (27)              (44)

    Increase in trade receivables                                                                                                                       (621)           (2,834)

    Decrease (increase) in prepaid expenses and other current and long-term assets                                                                    (4,364)               441

    Increase in trade payables                                                                                                                            821             12,320

    Increase (decrease) in employees and payroll accruals                                                                                               2,897              (123)

    Increase in short term and long term deferred revenues                                                                                             11,659              9,088

    Increase (decrease) in accrued expenses and other current liabilities                                                                               1,151              2,291

    Net cash provided by operating activities                                                                                                          10,470             22,063
                                                                                                                                                       ------             ------

    INVESTING ACTIVITIES:

    Proceeds from short-term deposits and restricted deposits                                                                                          12,323             17,392

    Investment in short-term deposits and restricted deposits                                                                                        (24,150)          (41,000)

    Purchase of property and equipment                                                                                                                (1,046)           (3,128)

    Payment for Businesses acquired                                                                                                                         -                 -

    Net cash provided by (used in) investing activities                                                                                              (12,873)          (26,736)
                                                                                                                                                      -------            -------

    FINANCING ACTIVITIES:

    Proceeds from exercise of options and ESPP shares                                                                                                   7,572              4,444

    Credit line repayment                                                                                                                                   -                 -

    Net cash provided by financing activities                                                                                                           7,572              4,444
                                                                                                                                                        -----              -----

    INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                                                                                    5,169              (229)

    CASH AND CASH EQUIVALENTS-Beginning of period                                                                                                      52,779            124,132

    CASH AND CASH EQUIVALENTS-End of period                                                                                                           $57,948           $123,903
                                                                                                                                                      =======           ========

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SOURCE Wix.com Ltd.