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Globe and Mail
21-05-2025
- Business
- Globe and Mail
WIX's Q1 Earnings Lag, Top Line Up Y/Y on AI Innovation & User Growth
Ltd WIX reported non-GAAP earnings per share (EPS) of $1.55 for first-quarter 2025, which missed the Zacks Consensus Estimate of $1.66. The company had reported EPS of $1.29 in the year-ago quarter. Quarterly revenues increased 13% year over year to $473.7 million, beating the Zacks Consensus Estimate of $471.8 million. The top line exceeded management's guidance ($469-$473 million), driven by strong performance of the new user cohort and continued healthy engagement from existing users. Wix is focusing on AI to reduce user friction, enhance design quality and speed up time-to-market for customers. The recent launch of Wixel is a primary step in this vision. At the end of March 31, 2025, registered users were 288 million. WIX's shares have gained 8.7% compared with the Zacks Computer-IT Services ' growth of 8.1% in the past year. Quarter in Detail Creative Subscriptions ' revenues (71.3% of total revenues) increased 11% year over year to $337.7 million. Business Solutions ' revenues (28.7% of total revenues) rose 18% to $136 million. For the first quarter, Creative Subscriptions' annualized recurring revenues were $1.37 billion, up 10% year over year. Bookings jumped 12% to $510.9 million year over year. Creative Subscriptions' bookings increased 10% to $369.5 million and Business Solutions' bookings rose 15% to $141.4 million. Partners' revenues in the first quarter were $171.6 million, up 24% year over year. The Wix Studio platform, aimed at agencies and professionals, is the key driver with strong adoption and market share gains, aided by Wixel's potential to further integrate into the workflow of design partners. Region-wise, North America, Europe, Asia and others, and Latin America contributed 60%, 25%, 11% and 4% to first-quarter 2025 revenues, up 14%,16%,10% and 7% year over year, respectively. Operating Details Non-GAAP gross margin was 69% compared with 68% in the prior-year quarter. Creative Subscriptions segment achieved 84% and the Business Solutions segment 31%. Wix reported a non-GAAP operating income of $99.8 million compared with $69.4 million in the year-ago quarter. Balance Sheet & Cash Flow As of March 31, 2025, Wix had cash and cash equivalents of $653.3 million compared with $660.9 million as of Dec 31, 2024. Cash flow from operations amounted to $145.5 million compared with $113.8 million in the previous year. Capital expenditures totaled $3.1 million. Free cash flow was $142.4 million. Wix repurchased $200 million worth of shares in January 2025, acquiring 868,026 shares at an average price of $230.41. To reinforce shareholder value, the board has now authorized an additional $200 million repurchase, bringing the total program to $400 million. Q2 & 2025 Financial Outlook Despite macroeconomic uncertainty and foreign exchange fluctuations, Wix has maintained its 2025 guidance. The company continues to expect revenues to grow 12-14% in the range of $1.97-$2 billion. Management reiterated non-GAAP total gross margin at 70% and non-GAAP operating expenses to be 47-48% of 2025 net sales. Amid strong results and a healthy top of the funnel, Wix reiterated bookings outlook at $2,025–2,060 million (up 11–13% year over year). This cautious approach reflects macro uncertainty in the Business Solutions segment, though easing forex headwinds help balance the risk. It estimates free cash flow for 2025 in the range of $590-$610 million, implying 30-31% of revenues. For second-quarter 2025, revenues are expected to be between $485 million and $489 million, suggesting 11-12% growth from the prior-year quarter's reported figure. Its Rule of 45 strategy, which combines revenue growth and free cash flow margin, is expected to be met at the high end of its 2025 outlook. WIX's Zacks Rank Currently, Wix carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. Recent Performance of Other Companies CDW Corporation CDW reported first-quarter 2025 non-GAAP EPS of $2.15, beating the Zacks Consensus Estimate of $1.96. Also, the bottom line increased approximately 12% year over year. In the past year, shares of CDW have declined 20.3%. ServiceNow NOW reported first-quarter 2025 adjusted earnings of $4.04 per share, which beat the Zacks Consensus Estimate by 6.60% and increased 18.5% year over year. NOW's revenues of $3.09 billion surpassed the consensus mark by 0.18% and increased 18.6% year over year. Shares of NOW have soared 32.6% in the past year. Infosys INFY ended fiscal 2025 on a mixed note, with its fourth-quarter earnings surpassing the Zacks Consensus Estimate while revenues fell short of the same. For the quarter, the company reported earnings of 20 cents per share, beating the consensus mark by a penny. However, Infosys' bottom line registered a year-over-year decline of 15.3%. In the past year, shares of INFY have gained 5.6%. Zacks Names #1 Semiconductor Stock It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom. With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028. See This Stock Now for Free >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report American Noble Gas Inc. (INFY): Free Stock Analysis Report ServiceNow, Inc. (NOW): Free Stock Analysis Report CDW Corporation (CDW): Free Stock Analysis Report Ltd. (WIX): Free Stock Analysis Report
Forbes
25-03-2025
- Business
- Forbes
AI, Privacy, And Power: Are People Finally Reclaiming Their Data?
Are we growing wiser about tech? Deposit Photos My, how things change. In 2019, I interviewed Cindy Goss, Founder/Principal ofPropel Business Solutions, Inc., a Southern California-based branding and marketing firm, about the dangers of Surveillance Capitalism. If you're unfamiliar with the term, it originates from a book by the same name by Harvard professor Shoshana Zuboff. An experienced marketer who groks data's value in the digital age, Goss and I first teamed up to make sense of so many growing number of business models built around monetizing attention and tracking online behaviors. While we both saw value in leveraging the Attention Economy, we were alarmed by unprecedented data extraction, specifically how big tech companies like Google and Facebook commodify user activity, often without informed users' consent. Back then, it still came as a surprise to many people that we are the product of so many 'free' social media platforms. Too often we willingly give up our data, including our likes, our thoughts, even our location information to big tech companies for the privilege of connecting with others in innumerable ways. The question then was whether enough people would 'wake up' to the fact that we are being endlessly exploited online. Specifically, we wondered how so many of us could willingly trade privacy for convenience and other perks. Now, in 2025, are we finally experiencing an inflection point? This appears to be the case. Have conversations about data sovereignty, digital rights, and now, AI-powered privacy tools, entered the mainstream? Yes and no. While it's true anyone can learn how we are endlessly tracked, molded, and prodded, that was also true in 2019. If that year signaled our societal adolescence regarding how we respond to web-based technologies—operating in a naïve and reckless manner—we may now finally be entering early adulthood. 'More than half a decade later, it seems like we're becoming more aware, more cautious, and happily, more empowered about the Internet and its impact on our lives,' says Goss. Perhaps the biggest reason for the societal shift was COVID-19. As businesses that are reliant upon in-person interactions like restaurants and gyms were forced to close or restrict access, others yet realized they could continue in a virtual manner during the pandemic. 'Overnight, so many of our clients, including law firms and other professional service firms, pivoted to operating virtually via teleconferencing applications like Zoom,' says Goss. 'They were a godsend from a productivity and business continuance standpoint.' On the other hand, remote work also led to the normalization of companies surveilling staff, especially those who work from home. 'Take any consumer tech buzzword of the 21st century and chances are it's already being widely used across the U.S. to monitor time, attendance and, in some cases, the productivity of workers, in sectors such as manufacturing, retail, and fast food chains: RFID badges, GPS time clock apps, NFC apps, QR code clocking-in, Apple Watch badges, and palm, face, eye, voice, and finger scanners,' Wired wrote in February, 2025. 'Track and trace' work technologies can't help but evoke unpleasant COVID phrases like 'contact tracing' so many of us would love to leave behind us. Such public disaffection dovetails with a growing shift in consumer attitudes—for the better. For example, prior to 2020, there was much more indifference as to how companies monitored our activities. Nowadays? People are more protective of their data than ever before. Much of the concern stems from high-profile data breaches, and the growing realization that our digital footprints are permanent. 'Many of us are more concerned about surveillance and online influences,' says Goss. 'Especially families that worry about all the increased time young people spend on their screens.' Other factors have contributed to this sea change. The Business Transparency Act forced companies to disclose more information about their operations while individuals have simultaneously pushed back against personal data collection. Also, as AI-powered tracking and data collection have become ever more invasive, there are increasing demands for regulators to intervene. Meanwhile, governments have tightened regulations on data privacy, such as Europe's General Data Protection Regulation (GDPR) and The California Privacy Rights Act (CPRA). There's a fine line here, though. While governmental intervention has been encouraged to safeguard privacy, overreach remains a concern. For instance, the Twitter Files exposed alarming ways in which our nation's intelligence agencies pressured social media companies to censor or shadow ban information. Citizens seeking alternative news sources had to turn to decentralized platforms like Rumble for their news. Likewise, after sites like PayPal refused to process transactions for politically unpopular speech, people turned to payment alternatives, such as crypto currencies. At the heart of this whole discussion is AI. Before the pandemic, AI was not the hot topic it is today. While it has the potential for misuse, such as supercharging surveillance capitalism, promoting censorship, and enabling debanking, it can do much good in the world. Next wave, AI-driven privacy tools remove centralized data control from big tech. Likewise, blockchain-powered identity protection allows users to control how their data is shared and who has access. And AI-driven encryption models enable individuals to collaborate peer-to-peer, transacting without third-party surveillance and/or incursion. 'In 2025, the key question is who will lead the AI revolution,' says Goss. 'Will it be corporations? Governments? Individuals? Some combination of all three?' Already, we are in an arms race against China. America stands apart from our rival due to our commitment to liberty and free market principles. Continuing to evolve our technology with this ethos in mind will help ensure we really are entering our early adulthood phase with technology. For now, a growing tension persists in the zeitgeist. While each of us is forced to share ever more personal data, our institutions—both corporate and governmental—are often less transparent, less subject to control. 'We're asked to give up our privacy, yet the government has been quite opaque—not just this administration—but previous ones too,' says Goss. The way forward is not to pretend we can go back to a less technological existence, one free from online interactions and AI. Instead, much like we posited in 2019, it's about finding solutions to empower the individual over big institutions. Our youth can help lead the charge in this regard. 'When I observe the younger generation, especially those who grew up in COVID's shadow, I feel heartened for the future,' says Goss. 'While it's devastating that so many missed out on key parts of their childhood like graduations and prom, they learned firsthand the dangers of technological centralization.' Moving forward, these same youngsters will be skeptical of authority in ways their elders were not, regardless of their political affiliation. This cannot help but bode well for the rise of human-centered innovation, the type that seeks to uplift rather than exploit. 'No pain, no gain,' is an immutable law of nature. Learning is impossible without strife. Reflecting on the last six years, it's undeniable that we have collectively experienced hardship—not unlike what a teen undergoes as they grow up. Wisdom can be the result of such struggle. As we straddle the halfway mark of the 2020s, here's to using all we have gone through as a vehicle for our collective growth. Six years ago, our advice was to rebel against the forces of technological tyranny. While rebellion can serve a purpose, it's often the domain of the adolescent. It's what teens do. Now that we are a bit older, a bit wiser, let us use our hard-won insights and experiences to improve the world around us. As any grownup well knows, this is what real responsibility requires.
