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Website builder Wix.com to cut costs amid global slowdown

Wix.com, which helps small businesses set up and operate websites, said on Wednesday it aims to cut costs by $150 million a year to offset a global economic slowdown and a stronger dollar that has weighed on revenue. .

Wix said it will take comprehensive cost-cutting measures in a three-year plan, including job cuts, to increase free cash flow and accelerate margins.

About 20% of savings are expected to happen in 2022, he said.

About 75% of the savings will come largely from operating expenses.

The Israeli company reported a loss of 14 cents a share, excluding one-time items, compared with a loss of 28 cents a share a year earlier. Revenue grew 9% to $345.2 million.

The market forecast was a loss of $0.34 excluding special items on revenue of $344 million, according to data from Refinitiv IBES.

The company, whose shares are down 56% so far in 2022, projected free cash flow at around 2% to 3% of revenue in 2022 and free cash flow margin of 20% by 2025.

For the third quarter, Wix estimated revenue of $341 million to $345 million, an annual growth of 7% to 8% but below analysts’ forecasts of $354 million.

The company expects revenue growth of 8% to 10% in 2022, down from a previous estimate of 10% to 13%.

Wix noted that estimates include the impact of closing operations in Russia and currency effects due to a stronger dollar.

Source: CNN Brasil

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