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Website creator Wix raises 2021 outlook after Q3 tops estimates

·2 min read
FILE PHOTO: The logo of website-designer firm Wix.com is seen at a high-tech park in Beersheba

By Steven Scheer

JERUSALEM (Reuters) - Wix.com, which helps companies build and operate websites, said on Thursday it was converting more customers from free to premium services as it raised its revenue outlook for the year.

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

"There still is uncertainty. But as time passes people are going more and more back to normal," chief financial officer Lior Shemesh told Reuters after issuing third-quarter results that beat estimates.

"We hope that will continue, but it's really encouraging."

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

Shemesh said Wix was adding features that were converting more customers from free to premium services, raising its average revenue per user (ARPU). "More than anything it's a good sign for next year," he said.

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

Analysts had forecast Wix would lose 42 cents a share ex-items on revenue of $315 million.

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

Shemesh said that Wix, whose Nasdaq listed shares are down some 20% so far in 2021, has been partly impacted by the strong shekel, which stands at a 25-year high versus the dollar and so the firm lowered its 2021 free cash flow estimate to $22-$27 million from $35-$40 million to reflect that.

(Reporting by Steven Scheer; Editing by Ari Rabinovitch, Elaine Hardcastle)