Website creator Wix raises 2021 outlook after Q3 beat estimates

The logo of web design company is seen at a tech park in Beersheba, southern Israel August 28, 2017. REUTERS/Amir Cohen

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JERUSALEM, Nov 11 (Reuters) – (WIX.O), which helps businesses build and operate websites, said on Thursday it was converting more customers from free to premium services as it boosted its prospects income for the year.

Wix said its business was returning to normal after a dip during the COVID-19 pandemic.

“There is still uncertainty. But over time people are getting more and more back to normal,” chief financial officer Lior Shemesh told Reuters after reporting third-quarter results that beat estimates.

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“We hope it will continue, but it’s really encouraging.”

After cutting 2021 estimates in August, Wix raised them again and now forecasts 2021 revenue of $1.265-1.274 billion, up from the previous outlook of $1.255-1.270 billion. Analysts on average expect revenue of $1.266 billion, according to I/B/E/S data from Refinitiv.

Shemesh said Wix is ​​adding features that are converting more customers from free to premium services, increasing its average revenue per user (ARPU). “More than anything, it’s a good sign for next year,” he said.

The Israeli company announced a lower-than-expected quarterly net loss excluding one-time items of 21 cents per share, compared with a loss of 14 cents a year earlier. Revenue increased 26% to $321 million.

Analysts had expected Wix to lose 42 cents per share ex-articles on revenue of $315 million.

The company said it expects fourth-quarter revenue of $324 million to $333 million, in line with analyst expectations of $329 million.

Shemesh said Wix, whose Nasdaq-listed shares are down about 20% so far in 2021, was partly affected by the strong shekel, which sits at a 25-year high against the dollar. and the company has therefore lowered its free cash flow estimate for 2021 to $22-27 million from $35-40 million to reflect this.

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Reporting by Steven Scheer Editing by Ari Rabinovitch, Elaine Hardcastle

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