Wix Announces Completion of $300 Million in Share Repurchases

Rhea-AI Summary

Wix.com Ltd. (WIX) completes $300 million share repurchases, representing 4% of total shares outstanding. Plans $225 million more in repurchases following approval.

Financial Analyst

The completion of a $300 million share repurchase by Wix.com Ltd. represents a significant capital allocation decision that likely reflects the management's confidence in the company's financial health and future prospects. By repurchasing 4% of its total shares outstanding, Wix is effectively concentrating the ownership among existing shareholders, which can be beneficial if the company's earnings per share (EPS) increase as a result of the reduced share count.

Investors often view share buybacks as a positive signal, as it suggests that the company believes its shares are undervalued and that it is a better use of capital than other investment opportunities. This can lead to a short-term increase in the stock price. However, the long-term impact depends on whether the repurchased shares were indeed undervalued and if the company can sustain its growth without the need for that capital. The volume-weighted average price of $124.91 will be a key figure to watch, as it provides a benchmark for evaluating the buyback's success over time.

Market Research Analyst

Wix's decision to allocate 50% of projected free cash flow through 2025 for further share repurchases is an aggressive strategy that underscores the company's focus on shareholder returns. It is essential to consider the context within the tech industry, where companies often reinvest heavily into growth and R&D. Wix's strategy might indicate a maturing business model or a lack of attractive investment opportunities to fuel growth.

Market perception of such a strategy will vary; some investors might appreciate the return of capital, while others could be concerned about the long-term growth implications. The exclusion of costs associated with the company's new headquarters office build-out from free cash flow calculations for repurchases is also noteworthy. This suggests that Wix is making a clear distinction between one-time capital expenditures and ongoing operational cash flow, which could impact how investors assess the company's financial sustainability and growth trajectory.

NEW YORK, Feb. 15, 2024 /PRNewswire/ -- Wix.com Ltd. (Nasdaq: WIX), today announced that it has completed $300 million in share repurchases, which received court approval in December 2023 and is part of the authorization by its Board of Directors approved in August 2023.

The Company repurchased 2,401,695 outstanding Wix ordinary shares, representing approximately 4% of total shares outstanding, at an approximate volume-weighted average price per share of $124.91.

Pursuant to its Board of Directors' authorization of share repurchases of 50% of projected free cash flow through 2025 (excluding costs associated with the Company's new headquarters office build out), Wix is in the process of pursuing the necessary approvals for $225 million in additional share repurchases.

About Wix.com Ltd.

Wix is the leading SaaS website builder platform to create, manage, and grow a global, digital presence¹. What began as a website builder in 2006 is now a complete platform providing self-creators, agencies, and enterprises, with distinguished performance, security, and a reliable infrastructure. With a focus on continuous innovation, a wide range of commerce and business solutions, advanced SEO, marketing tools, and industry-leading AI technologies, Wix users have full ownership of their brand and unmatched creative freedom. Complimenting the Wix platform for self-creators, Wix Studio is an advanced creation and management platform for agencies and freelancers.

For more about Wix, please visit our Press Room at https://www.wix.com/press-room/home.

Investor Relations: ir@wix.com

Media Relations Contact: PR@wix.com

¹ Based on number of active live sites as reported by competitors' figures, independent third-party-data and internal data as of Q3 2023.

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SOURCE Wix.com Ltd.

How much did Wix.com Ltd. (WIX) complete in share repurchases?

Wix.com Ltd. completed $300 million in share repurchases.

What percentage of total shares outstanding did Wix.com Ltd. (WIX) repurchase?

Wix.com Ltd. repurchased approximately 4% of total shares outstanding.

What is the approximate volume-weighted average price per share for the repurchases by Wix.com Ltd. (WIX)?

The approximate volume-weighted average price per share for the repurchases by Wix.com Ltd. was $124.91.

What is the total amount Wix.com Ltd. (WIX) plans for additional share repurchases?

Wix.com Ltd. plans $225 million for additional share repurchases.

What is the basis for Wix.com Ltd. (WIX) to pursue share repurchases?

Wix.com Ltd. is pursuing share repurchases based on its Board of Directors' authorization of repurchases of 50% of projected free cash flow through 2025.