JERUSALEM (Reuters) – Wix.com, which helps small businesses build and run websites, reported a lower-than-expected second-quarter loss on Wednesday and announced a plan to sharply cut costs by $150 million. dollars per year.
The Israeli company said it lost 14 cents per share excluding one-time items, compared with a loss of 28 cents per share a year earlier. Revenue increased 9% to $345.2 million.
Wix is expected to lose 34 cents excluding one-time items, on revenue of $344 million, according to data from Refinitiv I/B/E/S.
“Despite the current macroeconomic environment, we are focused on what is within our control – improving operational efficiency to accelerate our path to profitability while
continue to execute growth initiatives,” Chief Executive Avishai Abrahami said.
As part of a three-year plan, Wix said it would take comprehensive cost-cutting measures, including in its workforce, aimed at increasing free cash flow and accelerating margin expansion . Approximately 20% of the annualized savings are expected
be realized already in 2022, he said.
Wix, whose shares have fallen 56% so far in 2022, forecasts free cash flow of around 2% to 3% of revenue in 2022. It seeks to achieve a free cash flow margin 20% by 2025.
For the third quarter, Wix estimated revenue of $341-345 million, representing annual growth of 7-8%. That would be lower than analysts’ forecast of $354 million.
He expects revenue growth of 8% to 10% in 2022, below a previous estimate in May of 10% to 13%.
Wix noted that the estimates included the impact of closing operations in Russia, an assumption that market conditions would remain challenging for the remainder of the year, and currency effects.
(Reporting by Steven Scheer; Editing by Bradley Perrett)