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Wix Reports Fourth Quarter and Full Year 2023 Results

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Outperformance of 2023 targets as well as anticipated acceleration of top-line growth and overachievement of 2024 targets in three-year plan underpin expectation to significantly surpass the Rule of 40 in 2025

Capped off a year of strong growth with total revenue of $404 million in the fourth quarter, up 14% y/y driven by continued growth acceleration in the Partners businessPartners1 revenue totaled $130.1 million in Q4, up 38% y/y, as more Partners joined Wix, monetization continued to increase and Studio uptake exceeded expectationsRobust growth paired with solid operating leverage drove Wix to outperform the 2023 targets outlined in three-year planAchieved positive full year GAAP net income two years earlier than anticipatedQ4 FCF2 margin was a record 22% and full year FCF2 margin was 16%, meaningfully above 13% margin targetStrong bookings and revenue growth anticipated for 2024 driven by momentum from milestone product launches of 2023, solid business fundamentals and stable and positively-trending macro environmentExpect 2024 bookings growth of 12-14% y/y with acceleration through the year to 15% y/y growth in 2H24; expect full year revenue growth of 11-13% y/yExpect FCF2 margin of 21-23% in 2024, driven by growth and continued operational efficiency benefitsCompleted $300 million share repurchase plan in February and in the process of pursuing the necessary approvals for $225 million in additional share repurchases

NEW YORK, Feb. 21, 2024 /PRNewswire/ — Wix.com Ltd. (Nasdaq: WIX), the leading SaaS website builder platform globally,3 today reported financial results for the fourth quarter and full year of 2023. In addition, the Company provided its initial outlook for the first quarter and full year 2024. Please visit the Wix Investor Relations website at https://investors.wix.com/ to view the Q4’23 Shareholder Update and other materials.

“We wrapped up an outstanding year of accelerating growth and record profitability with a strong fourth quarter underpinned by robust business fundamentals and anchored by incredible momentum in our Partners business,” said Avishai Abrahami, Wix Co-founder and CEO. “Additionally, 2023 was a milestone year for innovation at Wix. Wix Studio has proven to be our highest-performing product release in recent history. In just six months, more than 500,000 agencies and freelancers have created Studio accounts, driving the number of Studio premium subscriptions to be ahead of plan. Most excitingly, nearly half of these Studio accounts were created by new Partners – a powerful indication that Studio is successfully winning a new market of large agencies who had not built on Wix before. AI was another major focus of innovation in 2023, building on nearly a decade of leading AI research and development at Wix. We introduced a suite of new genAI and AI tools, including AI Chat Experience for Business, AI Code Assistant and, most recently, AI Site Generator, which has been in the hands of many of our users for a couple of months and is already generating fantastic feedback. Both Self Creators and Partners have shown excellent engagement with our AI products over the past year, with the majority of new users today using or interacting with at least one AI tool on their web creation journey. We expect continued momentum and ramping benefits from these milestone products coupled with our upcoming product pipeline to propel accelerating growth in 2024.”

“Q4 capped off an incredibly strong year of sustained profitable growth with revenue in the fourth quarter increasing 14% y/y, driven by incredible Partners revenue growth of 38% y/y,” added Lior Shemesh, CFO at Wix. “On top of this outperformance in 2023, I am extremely confident in our ability to comfortably beat our three-year plan – let me walk you through my reasoning:

“First, we expect to drive accelerating profitable growth in 2024 and see a number of indicators of growth momentum today, including (1) improved visibility from a stable and positively-trending macro environment; (2) continued strong cohort behavior, particularly in our Partners business; and (3) ramping benefits from Studio and the milestone AI initiatives launched in 2023. Because of this visibility and confidence, we are reintroducing bookings guidance, which we expect to accelerate to 12-14% y/y growth in 2024 with 15% y/y growth in 2H.

“Second, this bookings acceleration in 2024, which we expect will primarily be driven by improved Creative Subscriptions performance, will position us for revenue acceleration in 2025. Higher revenue growth coupled with continued efficient business operations will, we anticipate, allow us to exceed the 2024 targets we shared in our August 2023 Analyst Day.

“Finally, outperformance of our 2023 targets as well as this anticipated top-line acceleration and overachievement of our profitability targets in 2024 gives us confidence that we will not just reach, but actually exceed our three-year plan and significantly surpass the Rule of 40 in 2025.”

Q4 2023 Financial Results

Total revenue in the fourth quarter of 2023 was $403.8 million, up 14% y/yCreative Subscriptions revenue in the fourth quarter of 2023 was $296.2 million, up 12% y/yCreative Subscriptions ARR increased to $1.19 billion as of the end of the quarter, up 10% y/yBusiness Solutions revenue in the fourth quarter of 2023 was $107.6 million, up 20% y/yTransaction revenue4 was $46.6 million, up 20% y/yPartners revenue1 in the fourth quarter of 2023 was $130.1 million, up 38% y/yTotal bookings in the fourth quarter of 2023 were $395.0 million, up 6% y/y; excluding long-term bookings associated with B2B partnership agreements, total bookings grew 10% y/yCreative Subscriptions bookings in the fourth quarter of 2023 were $283.5 million, up 1% y/y; excluding long-term bookings associated with B2B partnership agreements, Creative Subscriptions bookings grew 5% y/yBusiness Solutions bookings in the fourth quarter of 2023 were $111.5 million, up 24% y/yTotal gross margin on a GAAP basis in the fourth quarter of 2023 was 69%Creative Subscriptions gross margin on a GAAP basis was 82%Business Solutions gross margin on a GAAP basis was 32%Total non-GAAP gross margin in the fourth quarter of 2023 was 70%Creative Subscriptions gross margin on a non-GAAP basis was 83%Business Solutions gross margin on a non-GAAP basis was 33%GAAP net income in the fourth quarter of 2023 was $3.0 million, or $0.05 per basic and diluted shareNon-GAAP net income in the fourth quarter of 2023 was $74.0 million, or $1.29 per basic share or $1.22 per diluted shareNet cash provided by operating activities for the fourth quarter of 2023 was $90.4 million, while capital expenditures totaled $10.0 million, leading to free cash flow of $80.4 millionExcluding one-time cash restructuring charges and the capital expenditures and other expenses associated with the build out of our new corporate headquarters free cash flow for the fourth quarter of 2023 would have been $90.1 million, or 22% of revenueExecuted $59 million in repurchases of ordinary shares

FY 2023 Financial Results

Total revenue for the full year 2023 was $1.56 billion, up 13% y/yCreative Subscriptions revenue for the full year 2023 was $1.15 billion, up 11% y/yBusiness Solutions revenue for the full year 2023 was $409.7 million, up 18% y/yTransaction4 revenue for the full year was $177.5 million, up 20% y/yPartners1 revenue for the full year 2023 was $468.5 million, up 35% y/yTotal bookings for the full year 2023 were $1.60 billion, up 9% y/y; excluding long-term bookings associated with B2B partnership agreements, total bookings grew 11% y/yCreative Subscriptions bookings for the full year 2023 were $1.17 billion, up 5% y/y; excluding long-term bookings associated with B2B partnership agreements, Creative Subscriptions bookings grew 8% y/yBusiness Solutions bookings for the full year 2023 were $422.7 million, up 21% y/yTotal gross margin on a GAAP basis for the full year 2023 was 67%Creative Subscriptions gross margin on a GAAP basis was 81%Business Solutions gross margin on a GAAP basis was 27%Total non-GAAP gross margin for the full year 2023 was 68%Creative Subscriptions gross margin on a non-GAAP basis was 82%Business Solutions gross margin on a non-GAAP basis was 29%GAAP net income for the full year 2023 was $33.1 million, or $0.58 per basic share or $0.57 per diluted shareNon-GAAP net income for the full year 2023 was $268.3 million, or $4.72 per basic share or $4.39 per diluted shareNet cash provided by operating activities for the full year 2023 was $248.2 million, while capital expenditures totaled $66.0 million, leading to free cash flow of $182.2 millionExcluding the capex investment associated with our new headquarters office build out, free cash flow for the full year 2023 would have been $246.1 million, or 16% of revenueExecuted $127 million in repurchases of ordinary shares as we remained committed to share count management and returning value to shareholdersAdded 189 thousand net premium subscriptions in full year 2023 to reach nearly 6.3 million total premium subscriptions as of December 31, 2023Registered users as of December 31, 2023 were 263 million, representing an 8% increase compared to December 31, 2022Total employee headcount as of December 31, 2023 of 5,302, down 4% from the end of 2022

____________________

1

Partners revenue is defined as revenue generated through agencies and freelancers that build sites or applications for other users as well as revenue generated through B2B partnerships, such as LegalZoom or Vistaprint, and enterprise partners. We identify agencies and freelancers building sites or applications for others using multiple criteria, including but not limited to, the number of sites built, participation in the Wix Partner Program and/or the Wix Marketplace or Wix products used (incl. Wix Studio). Partners revenue includes revenue from both the Creative Subscriptions and Business Solutions businesses.

2

Free cash flow excluding one-time cash restructuring charges, if applicable, and expenses associated with the buildout of our new corporate headquarters.

3

Based on number of active live sites as reported by competitors’ figures, independent third-party-data and internal data as of Q2 2023.

4

Transaction revenue is a portion of Business Solutions revenue, and we define transaction revenue as all revenue generated through transaction facilitation, primarily from Wix Payments as well as Wix POS, shipping solutions and multi-channel commerce and gift card solutions.

Financial Outlook

Coming off of a strong year of significant product launches and strengthening fundamentals, we believe our business will experience strong top line growth of bookings in 2024 and more significantly in the second half of the year. This positive trend in bookings growth is expected to translate into y/y revenue growth acceleration in 2025.

This growth, paired with improved profitability targets due to a high degree of operating efficiency, leads to our expectation that our financial performance in 2024 and in 2025 will surpass the three-year plan we shared at our Analyst & Investor Day in August.

We now expect to significantly exceed the Rule of 40 in 2025.

We are reintroducing bookings guidance as we enter 2024 with improved visibility and a tremendous amount of confidence in our business as a result of a stable and positively-trending macro environment, strong cohort behavior, particularly in our Partners business, and most notably, ramping benefits from Studio and the milestone AI initiatives launched in 2023.

Our outlook for the full year 2024 is as follows:

We expect total bookings of $1.78$1.81 billion, up 12 – 14% y/y, an acceleration from 2023. We expect y/y growth of total bookings to accelerate in the second half of 2024 to 15% at the high end of the guidance range, positioning the business to achieve accelerating y/y revenue growth in 2025.

In particular, the acceleration is expected to be primarily in Creative Subscription bookings, bringing it to double digit y/y growth in the 2H24.

We expect total revenue to be $1.73$1.76 billion, up 11 – 13% y/y.

We expect total revenue in Q1 2024 of $415$419 million, up 11 – 12% y/y.

We continue to operate the business in an efficient manner as evidenced by the meaningful operating leverage — on both a GAAP and non-GAAP basis — generated throughout 2023 compared to 2022. We plan to operate with the same efficiency in 2024 and expect strong gross profit growth due to gross margin improvements on a y/y basis as well as minimal incremental operating expenses this year.

We expect non-GAAP total gross margin of 68 – 69% with non-GAAP business solutions gross margin to exceed 30% for the full year.

We expect non-GAAP operating expenses to be 51 – 52% of revenue for the full year, with non-GAAP sales and marketing to remain similar to 2023 at roughly 23 – 24% of revenue.

We believe we are ahead of our plan to achieve GAAP profitability. We expect GAAP operating profit in 2024 as well as a second consecutive year of GAAP net income.

We expect to generate free cash flow, excluding headquarters costs, of $370$400 million, or 21 – 23% of revenue in 2024.

As we continue to responsibly manage dilution, we expect stock-based compensation expenses to decline as a percent of revenue for the third consecutive year to approximately 13% of revenue in 2024, in line with our three-year plan.

We expect capital expenditures, excluding costs associated with our new headquarters build out, of approximately $7$10 million in 2024. We will incur the final costs for our new headquarters in the first half of the year and anticipate them to be roughly $8$10 million.

Conference Call and Webcast Information

Wix will host a conference call to discuss the results at 8:30 a.m. ET on Wednesday, February 21, 2024. To participate on the live call, analysts and investors should register and join at https://register.vevent.com/register/BIefc01e3fb58f409e9a256960e4651d01. A replay of the call will be available through February 20, 2025 via the registration link.

Wix will also offer a live and archived webcast of the conference call, accessible from the “Investor Relations” section of the Company’s website at https://investors.wix.com/.

About Wix.com Ltd.

Wix is the leading SaaS website builder platform globally3 to create, manage and grow a digital presence. What began as a website builder in 2006 is now a complete platform providing users with enterprise-grade performance, security and a reliable infrastructure. Offering a wide range of commerce and business solutions, advanced SEO and marketing tools, Wix enables users to take full ownership of their brand, their data and their relationships with their customers. With a focus on continuous innovation and delivery of new features and products, anyone can build a powerful digital presence to fulfill their dreams on Wix.

For more about Wix, please visit our Press Room

Investor Relations:

ir@wix.com

Media Relations:

pr@wix.com

Non-GAAP Financial Measures and Key Operating Metrics

To supplement its consolidated financial statements, which are prepared and presented in accordance with U.S. GAAP, Wix uses the following non-GAAP financial measures: bookings, cumulative cohort bookings, bookings on a constant currency basis, revenue on a constant currency basis, non-GAAP gross margin, non-GAAP operating income (loss), non-GAAP operating margin, non-GAAP net income (loss), non-GAAP net income (loss) per share, free cash flow, free cash flow, as adjusted, free cash flow margins, free cash flow per share, non-GAAP R&D expenses, non-GAAP S&M expenses, non-GAAP G&A expenses, non-GAAP operating expenses, non-GAAP cost of revenue expense, non-GAAP financial expense, non-GAAP tax expense (collectively the “Non-GAAP financial measures”). Measures presented on a constant currency or foreign exchange neutral basis have been adjusted to exclude the effect of y/y changes in foreign currency exchange rate fluctuations. Bookings is a non-GAAP financial measure calculated by adding the change in deferred revenues and the change in unbilled contractual obligations for a particular period to revenues for the same period. Bookings include cash receipts for premium subscriptions purchased by users as well as cash we collect from business solutions, as well as payments due to us under the terms of contractual agreements for which we may have not yet received payment. Cash receipts for premium subscriptions are deferred and recognized as revenues over the terms of the subscriptions. Cash receipts for payments and the majority of the additional products and services (other than Google Workspace) are recognized as revenues upon receipt. Committed payments are recognized as revenue as we fulfill our obligation under the terms of the contractual agreement. Bookings and Creative Subscriptions Bookings are also presented on a further non-GAAP basis by excluding, in each case, bookings associated with long term B2B partnership agreements. Non-GAAP gross margin represents gross profit calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization, divided by revenue. Non-GAAP operating income (loss) represents operating income (loss) calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, acquisition-related expenses and sales tax expense accrual and other G&A expenses (income). Non-GAAP net income (loss) represents net loss calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, amortization, sales tax expense accrual and other G&A expenses (income), amortization of debt discount and debt issuance costs and acquisition-related expenses and non-operating foreign exchange expenses (income). Non-GAAP net income (loss) per share represents non-GAAP net income (loss) divided by the weighted average number of shares used in computing GAAP loss per share. Free cash flow represents net cash provided by (used in) operating activities less capital expenditures. Free cash flow, as adjusted, represents free cash flow further adjusted to exclude one-time cash restructuring charges and the capital expenditures and other expenses associated with the buildout of our new corporate headquarters. Free cash flow margins represent free cash flow divided by revenue. Free cash flow per share represents free cash flow, as adjusted, divided by total outstanding shares on a fully diluted basis. Non-GAAP cost of revenue represents cost of revenue calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP R&D expenses represent R&D expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP S&M expenses represent S&M expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP G&A expenses represent G&A expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP operating expenses represent operating expenses calculated in accordance with GAAP as adjusted for the impact of share-based compensation expense, acquisition-related expenses and amortization. Non-GAAP financial expense represents financial expense calculated in accordance with GAAP as adjusted for unrealized gains of equity investments, amortization of debt discount and debt issuance costs and non-operating foreign exchange expenses. Non-GAAP tax expense represents tax expense calculated in accordance with GAAP as adjusted for provisions for income tax effects related to non-GAAP adjustments.

The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. The Company uses these non-GAAP financial measures for financial and operational decision making and as a means to evaluate period-to-period comparisons. The Company believes that these measures provide useful information about operating results, enhance the overall understanding of past financial performance and future prospects, and allow for greater transparency with respect to key metrics used by management in its financial and operational decision making.

For more information on the non-GAAP financial measures, please see the reconciliation tables provided below. The accompanying tables have more details on the GAAP financial measures that are most directly comparable to non-GAAP financial measures and the related reconciliations between these financial measures. The Company is unable to provide reconciliations of free cash flow, free cash flow, as adjusted, cumulative cohort bookings, non-GAAP gross margin, and non-GAAP tax expense to their most directly comparable GAAP financial measures on a forward-looking basis without unreasonable effort because items that impact those GAAP financial measures are out of the Company’s control and/or cannot be reasonably predicted. Such information may have a significant, and potentially unpredictable, impact on our future financial results.

Wix also uses Creative Subscriptions Annualized Recurring Revenue (ARR) as a key operating metric. Creative Subscriptions ARR is calculated as Creative Subscriptions Monthly Recurring Revenue (MRR) multiplied by 12. Creative Subscriptions MRR is calculated as the total of (i) all Creative Subscriptions in effect on the last day of the period, multiplied by the monthly revenue of such Creative Subscriptions, other than domain registrations; (ii) the average revenue per month from domain registrations in effect on the last day of the period; and (iii) monthly revenue from other partnership agreements and enterprise partners.

Forward-Looking Statements

This document contains forward-looking statements, within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 that involve risks and uncertainties. Such forward-looking statements may include projections regarding our future performance, including, but not limited to revenue, bookings and free cash flow, and may be identified by words like “anticipate,” “assume,” “believe,” “aim,” “forecast,” “indication,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,” “outlook,” “future,” “will,” “seek” and similar terms or phrases. The forward-looking statements contained in this document, including the quarterly and annual guidance, are based on management’s current expectations, which are subject to uncertainty, risks and changes in circumstances that are difficult to predict and many of which are outside of our control. Important factors that could cause our actual results to differ materially from those indicated in the forward-looking statements include, among others, our expectation that we will be able to attract and retain registered users and generate new premium subscriptions, in particular as we continuously adjust our marketing strategy and as the macro-economic environment continues to be turbulent; our expectation that we will be able to increase the average revenue we derive per premium subscription, including through our partners; our expectations related to our ability to develop relevant and required products using Artificial Intelligence (“AI”), the regulatory environment impacting AI-related activities including privacy and intellectual property aspects, and potential competition from third-party AI tools which may impact our business; our expectation that new products and developments, as well as third-party products we will offer in the future within our platform, will receive customer acceptance and satisfaction, including the growth in market adoption of our online commerce solutions; our assumption that historical user behavior can be extrapolated to predict future user behavior, in particular during the current turbulent macro-economic environment; our expectation regarding the successful impact of our previously announced Cost-Efficiency Plan and other cost saving measures we may take in the future; our prediction of the future revenues and/or bookings generated by our user cohorts and our ability to maintain and increase such revenue growth, as well as our ability to generate and maintain elevated levels of free cash flow and profitability; our expectation to maintain and enhance our brand and reputation; our expectation that we will effectively execute our initiatives to improve our user support function through our Customer Care team, and that our recent downsizing of our Customer Care team will not affect our ability to continue attracting registered users and increase user retention, user engagement and sales; our plans to successfully localize our products, including by making our product, support and communication channels available in additional languages and to expand our payment infrastructure to transact in additional local currencies and accept additional payment methods; our expectation regarding the impact of fluctuations in foreign currency exchange rates, interest rates, potential illiquidity of banking systems, and other recessionary trends on our business; our expectations relating to the repurchase of our ordinary shares and/or Convertible Notes pursuant to our repurchase program; our expectation that we will effectively manage our infrastructure; our expectations regarding the outcome of any regulatory investigation or litigation, including class actions; our expectations regarding future changes in our cost of revenues and our operating expenses on an absolute basis and as a percentage of our revenues, as well as our ability to achieve and maintain profitability; our expectations regarding changes in the global, national, regional or local economic, business, competitive, market, and regulatory landscape, including as a result of Israel-Hamas war and/or the UkraineRussia war and any escalations thereof; our planned level of capital expenditures and our belief that our existing cash and cash from operations will be sufficient to fund our operations for at least the next 12 months and for the foreseeable future; our expectations with respect to the integration and performance of acquisitions; our ability to attract and retain qualified employees and key personnel; and our expectations about entering into new markets and attracting new customer demographics, including our ability to successfully attract new partners large enterprise-level users and to grow our activities with these customer types as anticipated and other factors discussed under the heading “Risk Factors” in the Company’s annual report on Form 20-F for the year ended December 31, 2022 filed with the Securities and Exchange Commission on March 30, 2023. The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. Any forward-looking statement made by us in this press release speaks only as of the date hereof. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future developments or otherwise.

Wix.com Ltd.

CONSOLIDATED STATEMENTS OF OPERATIONS – GAAP

(In thousands, except loss per share data)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Revenues

Creative Subscriptions

$       296,154

$       265,268

$   1,152,007

$   1,039,479

Business Solutions

107,617

89,772

409,658

348,187

403,771

355,040

1,561,665

1,387,666

Cost of Revenues

Creative Subscriptions

52,794

58,427

215,515

251,587

Business Solutions

73,319

70,337

297,013

274,640

126,113

128,764

512,528

526,227

Gross Profit

277,658

226,276

1,049,137

861,439

Operating expenses:

Research and development

125,743

120,994

481,293

482,861

Selling and marketing

103,642

97,944

399,577

492,886

General and administrative

43,401

39,941

160,033

171,045

Impairment, restructuring and other costs

3,103

32,614

Total operating expenses

275,889

258,879

1,073,517

1,146,792

Operating income (loss)

1,769

(32,603)

(24,380)

(285,353)

Financial income (expenses), net

6,461

(13,256)

62,474

(183,513)

Other income (expenses)

44

788

(255)

1,023

Income (loss) before taxes on income

8,274

(45,071)

37,839

(467,843)

Income tax expenses (benefit)

5,320

(6,096)

4,702

(42,980)

Net income (loss)

$            2,954

$       (38,975)

$         33,137

$     (424,863)

Basic net income (loss) per share

$              0.05

$            (0.67)

$              0.58

$            (7.33)

Basic weighted-average shares used to compute net income (loss) per share

57,317,815

58,189,246

56,829,962

57,993,364

Diluted net income (loss) per share

$              0.05

$            (0.67)

$              0.57

$            (7.33)

Diluted weighted-average shares used to compute net income (loss) per share

59,085,757

58,189,246

58,408,331

57,993,364

 

Wix.com Ltd.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

Period ended

December 31,

December 31,

2023

2022

Assets

(unaudited)

(audited)

Current Assets:

Cash and cash equivalents

$             609,622

$            244,686

Short-term deposits

212,709

526,328

Restricted deposits

2,125

13,669

Marketable securities

140,563

292,449

Trade receivables 

57,394

42,086

Prepaid expenses and other current assets

57,423

28,519

 Total current assets

1,079,836

1,147,737

Long-Term Assets:

Prepaid expenses and other long-term assets 

25,809

23,027

Property and equipment, net

136,928

108,738

Marketable securities

64,806

194,964

Intangible assets and goodwill, net

77,339

83,293

Operating lease right-of-use assets

420,562

200,608

 Total long-term assets

725,444

610,630

 Total assets

$          1,805,280

$        1,758,367

Liabilities and Shareholders’ Deficiency

Current Liabilities:

Trade payables

$                39,449

$              96,071

Employees and payroll accruals

56,581

86,113

Deferred revenues

592,608

529,205

Current portion of convertible notes, net

361,621

Accrued expenses and other current liabilities

76,556

88,194

Operating lease liabilities

24,981

29,268

Total current liabilities

790,175

1,190,472

Long Term Liabilities:

Long-term deferred revenues

83,384

70,594

Long-term deferred tax liability

7,167

14,902

Convertible notes, net

569,714

566,566

Other long-term liabilities

7,699

6,093

Long-term operating lease liabilities

401,626

172,982

Total long-term liabilities

1,069,590

831,137

 Total liabilities

1,859,765

2,021,609

Shareholders’ Deficiency

Ordinary shares

106

108

Additional paid-in capital

1,539,952

1,274,968

Treasury Stock

(558,871)

(431,862)

Accumulated other comprehensive loss

4,192

(33,455)

Accumulated deficit

(1,039,864)

(1,073,001)

Total shareholders’ deficiency

(54,485)

(263,242)

Total liabilities and shareholders’ deficiency

$          1,805,280

$        1,758,367

 

Wix.com Ltd.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

OPERATING ACTIVITIES:

Net income (loss) 

2,954

$     (38,975)

33,137

$  (424,863)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation 

6,725

5,209

20,492

16,611

Amortization

1,489

1,511

5,955

6,246

Share based compensation expenses

58,195

59,917

224,625

236,836

Amortization of debt discount and debt issuance costs

789

1,305

4,194

5,213

Changes in accrued interest and exchange rate on short term and long term deposits

(586)

(93)

(2,415)

(86)

Non-cash impairment, restructuring and other costs

3,567

26,699

Amortization of premium and discount and accrued interest on marketable securities, net

4,237

2,447

8,346

6,252

Remeasurement loss (gain) on Marketable equity

(10,296)

3,955

(30,608)

200,338

Changes in deferred income taxes, net

(2,035)

(11,997)

(8,784)

(57,865)

Changes in operating lease right-of-use assets

1,492

18,724

21,549

45,440

Changes in operating lease liabilities

11,517

(11,204)

(36,517)

(45,051)

Increase in trade receivables

(2,794)

(6,290)

(15,308)

(11,719)

Decrease (increase) in prepaid expenses and other current and long-term assets

(1,123)

26,713

(10,383)

(5,912)

Increase (decrease) in trade payables

16,263

(22,667)

(51,312)

(18,514)

Increase (decrease) in employees and payroll accruals

(8,307)

17,506

(29,532)

2,862

Increase in short term and long term deferred revenues

2,788

4,081

76,193

55,387

Increase in accrued expenses and other current liabilities

5,505

3,092

11,915

25,977

Net cash provided by operating activities

90,380

53,234

248,246

37,152

INVESTING ACTIVITIES:

Proceeds from short-term deposits and restricted deposits

131,754

308,379

625,495

644,809

Investment in short-term deposits and restricted deposits

(99,725)

(317,869)

(297,917)

(766,021)

Investment in marketable securities

(837)

(4,962)

(202,611)

Proceeds from marketable securities

31,920

98,244

249,190

290,113

Purchase of property and equipment and lease prepayment 

(9,582)

(14,434)

(63,021)

(68,554)

Capitalization of internal use of software

(408)

(215)

(3,028)

(2,110)

Investment in other assets

(111)

(580)

Proceeds from sale of equity securities

19,203

48,403

68,671

51,596

Payment for Businesses acquired, net of acquired cash

Purchases of investments in privately held companies

(76)

(40)

(7,603)

(1,300)

Net cash provided by (used in) investing activities

72,249

122,468

566,714

(54,658)

FINANCING ACTIVITIES:

Proceeds from exercise of options and ESPP shares

898

917

39,660

42,710

Purchase of treasury stock

(58,698)

(231,873)

(127,017)

(231,873)

Proceeds from issuance of convertible senior notes

Repayment of convertible notes

(362,667)

Payments of debt issuance costs

Purchase of capped call

Net cash used in financing activities

–           57,800

(230,956)

(450,024)

(189,163)

INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS

104,829

(55,254)

364,936

(206,669)

CASH AND CASH EQUIVALENTS—Beginning of period

504,793

299,940

244,686

451,355

CASH AND CASH EQUIVALENTS—End of period

609,622

$     244,686

$     609,622

$     244,686

 

Wix.com Ltd.

KEY PERFORMANCE METRICS

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Creative Subscriptions

296,154

265,268

1,152,007

1,039,479

Business Solutions

107,617

89,772

409,658

348,187

Total Revenues

$     403,771

$       355,040

$   1,561,665

$   1,387,666

Creative Subscriptions

283,501

281,766

1,174,776

1,121,411

Business Solutions

111,503

90,047

422,727

350,708

Total Bookings

$     395,004

$       371,813

$   1,597,503

$   1,472,119

Free Cash Flow

$       80,390

$         38,585

$       182,197

$       (33,512)

Free Cash Flow excluding HQ build out and restructuring costs

$       90,125

$         51,990

$       246,058

$         32,408

Creative Subscriptions ARR

$ 1,192,814

$   1,080,824

$   1,192,814

$   1,080,824

 

Wix.com Ltd.

RECONCILIATION OF REVENUES TO BOOKINGS

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Revenues

$     403,771

$       355,040

$   1,561,665

$   1,387,666

Change in deferred revenues

2,788

4,081

76,193

55,387

Change in unbilled contractual obligations

(11,555)

12,692

(40,355)

29,066

Bookings

$     395,004

$       371,813

$   1,597,503

$   1,472,119

B2B Partnership long-term bookings

(12,094)

(37,926)

Bookings excluding B2B Partnership long-term bookings

$     395,004

$       359,719

$   1,597,503

$   1,434,193

10 %

11 %

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Creative Subscriptions Revenues

$     296,154

$       265,268

$   1,152,007

$   1,039,479

Change in deferred revenues

(1,098)

3,806

63,124

52,866

Change in unbilled contractual obligations

(11,555)

12,692

(40,355)

29,066

Creative Subscriptions Bookings

$     283,501

$       281,766

$   1,174,776

$   1,121,411

B2B Partnership long-term bookings

(12,094)

(37,926)

Creative Subscriptions Bookings excluding B2B Partnership long-term bookings

$     283,501

$       269,672

$   1,174,776

$   1,083,485

5 %

8 %

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Business Solutions Revenues

$     107,617

$         89,772

$       409,658

$       348,187

Change in deferred revenues

3,886

275

13,069

2,521

Business Solutions Bookings

$     111,503

$         90,047

$       422,727

$       350,708

 

Wix.com Ltd.

RECONCILIATION OF COHORT BOOKINGS

(In millions)

Year Ended

December 31,

2023

2022

(unaudited)

Q1 Cohort revenues

$                  45

$                  41

Q1 Change in deferred revenues

15

15

Q1 Cohort Bookings

$                  60

$                  56

 

Wix.com Ltd.

RECONCILIATION OF REVENUES AND BOOKINGS EXCLUDING FX IMPACT

(In thousands)

Three Months Ended

December 31,

2023

2022

(unaudited)

Revenues

$     403,771

$       355,040

FX impact on Q4/23 using Y/Y rates

(1,732)

Revenues excluding FX impact

$     402,039

$       355,040

Y/Y growth

13 %

Three Months Ended

December 31,

2023

2022

(unaudited)

Bookings

$     395,004

$       371,813

FX impact on Q4/23 using Y/Y rates

(4,325)

Bookings excluding FX impact

$     390,679

$       371,813

Y/Y growth

5 %

 

Wix.com Ltd.

TOTAL ADJUSTMENTS GAAP TO NON-GAAP

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(1) Share based compensation expenses:

(unaudited)

(unaudited)

Cost of revenues

$          3,675

$            4,607

$         15,013

$         17,811

Research and development

$       31,982

32,335

119,482

120,580

Selling and marketing

$       11,232

9,559

41,277

38,714

General and administrative

$       11,306

13,416

48,853

59,731

Total share based compensation expenses

58,195

59,917

224,625

236,836

(2) Amortization

1,489

1,511

5,955

6,246

(3) Acquisition related expenses

9

1,656

472

5,127

(4) Amortization of debt discount and debt issuance costs

789

1,305

4,194

5,213

(5) Impairment, restructuring and other costs

3,103

32,614

(6) Sales tax accrual and other G&A expenses (income)

137

219

748

763

(7) Unrealized loss (gain) on equity and other investments

(10,296)

3,955

(30,608)

200,338

(8) Non-operating foreign exchange expenses (income)

15,287

6,220

1,499

6,403

(9) Provision for income tax effects related to non-GAAP adjustments

2,368

(176)

(4,337)

(46,078)

Total adjustments of GAAP to Non GAAP

$       71,081

$         74,607

$       235,162

$       414,848

 

Wix.com Ltd.

RECONCILIATION OF GAAP TO NON-GAAP GROSS PROFIT

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Gross Profit

$     277,658

$       226,276

$   1,049,137

$       861,439

Share based compensation expenses

3,675

4,607

15,013

17,811

Acquisition related expenses

5

229

140

Amortization 

667

689

2,669

2,968

Non GAAP Gross Profit 

282,005

231,572

1,067,048

882,358

Non GAAP Gross margin

70 %

65 %

68 %

64 %

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Gross Profit – Creative Subscriptions

$     243,360

$       206,841

$       936,492

$       787,892

Share based compensation expenses

2,695

3,437

11,081

13,933

Non GAAP Gross Profit – Creative Subscriptions

246,055

210,278

947,573

801,825

Non GAAP Gross margin – Creative Subscriptions

83 %

79 %

82 %

77 %

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Gross Profit – Business Solutions

$       34,298

$         19,435

$       112,645

$         73,547

Share based compensation expenses

980

1,170

3,932

3,878

Acquisition related expenses

5

229

140

Amortization 

667

689

2,669

2,968

Non GAAP Gross Profit – Business Solutions

35,950

21,294

119,475

80,533

Non GAAP Gross margin – Business Solutions

33 %

24 %

29 %

23 %

 

Wix.com Ltd.

RECONCILIATION OF OPERATING INCOME (LOSS) TO NON-GAAP OPERATING INCOME (LOSS)

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Operating income (loss)

$          1,769

$       (32,603)

$       (24,380)

$     (285,353)

Adjustments:

Share based compensation expenses

58,195

59,917

224,625

236,836

Amortization 

1,489

1,511

5,955

6,246

Impairment, restructuring and other charges

3,103

32,614

Sales tax accrual and other G&A expenses

137

219

748

763

Acquisition related expenses

9

1,656

472

5,127

Total adjustments

$       62,933

$         63,303

$       264,414

$       248,972

Non GAAP operating income (loss)

$       64,702

$         30,700

$       240,034

$       (36,381)

Non GAAP operating margin

16 %

9 %

15 %

-3 %

 

Wix.com Ltd.

RECONCILIATION OF NET INCOME (LOSS) TO NON-GAAP NET INCOME (LOSS) AND NON-GAAP NET INCOME (LOSS) PER SHARE

(In thousands, except per share data)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Net income (loss)

$          2,954

$       (38,975)

$         33,137

$     (424,863)

Share based compensation expenses and other Non GAAP adjustments

71,081

74,607

235,162

414,848

Non-GAAP net income (loss)

$       74,035

$         35,632

$       268,299

$       (10,015)

Basic Non GAAP net income (loss) per share

$            1.29

$              0.61

$              4.72

$            (0.17)

Weighted average shares used in computing basic Non GAAP net income (loss) per share

57,317,815

58,189,246

56,829,962

57,993,364

Diluted Non GAAP net income (loss) per share

$            1.22

$              0.61

$              4.39

$            (0.17)

Weighted average shares used in computing diluted Non GAAP net income (loss) per share

60,512,505

58,189,246

61,106,462

57,993,364

 

Wix.com Ltd.

RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO FREE CASH FLOW

(In thousands)

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Net cash provided by operating activities

$       90,380

$         53,234

$       248,246

$         37,152

Capital expenditures, net

(9,990)

(14,649)

(66,049)

(70,664)

Free Cash Flow

$       80,390

$         38,585

$       182,197

$       (33,512)

Restructuring and other costs

1,411

5,915

Capex related to HQ build out

8,324

13,405

57,946

65,920

Free Cash Flow excluding HQ build out and restructuring costs

$       90,125

$         51,990

$       246,058

$         32,408

 

Wix.com Ltd.

RECONCILIATION OF BASIC WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING AND THE DILUTED
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING 

Three Months Ended

Year Ended

December 31,

December 31,

2023

2022

2023

2022

(unaudited)

(unaudited)

Basic weighted-average shares used to compute net income (loss) per share 

57,317,815

58,189,246

56,829,962

57,993,364

Effect of dilutive securities (included in the effect of dilutive securities is the assumed conversion of
employee stock options, employee RSUs and the Notes)

1,767,942

1,578,369

Diluted weighted-average shares used to compute net income (loss) per share 

59,085,757

58,189,246

58,408,331

57,993,364

The following items have been excluded from the diluted weighted average number of shares outstanding
because they are anti-dilutive:

Stock options

2,245,872

4,332,022

2,245,872

4,332,022

Restricted share units

818,288

3,123,019

818,288

3,123,019

 Convertible Notes (if-converted)

1,426,728

3,969,514

1,426,728

3,969,514

63,576,645

69,613,801

62,899,219

69,417,919

 

View original content to download multimedia:https://www.prnewswire.com/news-releases/wix-reports-fourth-quarter-and-full-year-2023-results-302066896.html

SOURCE Wix.com Ltd.

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Technology

Toronto firm fined $5,000 for unauthorized use of professional engineer’s seal

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TORONTO, May 6, 2026 /CNW/ – The Ontario Court of Justice has fined a Toronto firm $5,000 for applying a facsimile of a professional engineer’s seal to an engineering report without the engineer’s knowledge or consent.

In June 2023, 11951076 Canada Inc., operating as Studio Four, affixed an engineer’s seal to an engineering report and submitted it to the City of Hamilton in connection with a residential building project. The engineer whose seal was used did not authorize the use of the seal.

A complaint was made to Professional Engineers Ontario (PEO), which investigated and laid charges under the Professional Engineers Act (PEA).

On April 24, 2026, Studio Four pleaded guilty to one count of breaching section 40(3)(b) of the PEA. The firm’s two directors, Salim Afroz and Ashweek Chhabra, also pleaded guilty to breaching section 40(5) of the Act in connection with this conduct.

Studio Four was ordered to pay a $5,000 fine. The two directors each received suspended sentences.

As the regulator of professional engineering in Ontario, PEO reminds the public that the unauthorized use or forgery of a professional engineer’s seal on construction or design drawings is a quasi-criminal offence under the PEA. Such conduct may also result in criminal charges under the Criminal Code of Canada.

PEO administers the Professional Engineers Act to serve and protect the public interest by licensing Ontario’s more than 98,000 professional engineers and engineering firms. Professional engineers can be identified by the “P.Eng.” designation following their names.

Members of the public can verify a professional engineer or engineering firm by searching PEO’s public directories at peo.on.ca/directory. Concerns about unlicensed individuals or unauthorized firms may be reported through PEO’s enforcement hotline at 416-840-1444, 1-800-339-3716 ext. 1444, or enforcement@peo.on.ca.

SOURCE Professional Engineers Ontario

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Tell a Friend, Save on Travel! EF World Journeys Launches Cross-Brand Referral Program That Rewards Travelers to Inspire the People in Their Lives to Tour the Globe

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New benefit allows travelers to unlock savings on future trips by introducing friends and family to EF Go Ahead Tours, EF Ultimate Break, and EF Adventures

CAMBRIDGE, Mass., May 6, 2026 /PRNewswire/ — EF World Journeys, a leader in guided, experiential travel for adults from Gen Z to Baby Boomers, today announced the launch of a new referral program, a travel rewards benefit that can be redeemed across EF Go Ahead Tours, EF Ultimate Break, and EF Adventures.

Under the new program, travelers will receive $100 in travel credit for every friend who books a trip using their referral, with every fifth referral earning you $500 and no cap on total rewards earned. In short, the more friends or family who book from your referral, the more you save on your next trip.

Each year, guided trips across EF World Journeys’ portfolio bring travelers together through shared experiences that extend far beyond the journey itself. Many of those travelers continue to engage with the people they meet on tour, often exchanging photos, stories, and future travel inspiration well after returning home. The new referral program builds on the natural desire to share those experiences, offering travelers easy ways to connect and invite friends, family members, and fellow adventurers to experience a guided group tour for themselves.

“At EF, we’ve always believed that one of the most powerful parts of travel is the connections and communities we create along the way,” said Heidi Durflinger, CEO of EF World Journeys USA. “This referral program makes that even easier, giving our travelers a way to bring friends and family into the experience while continuing to grow a global community of people who choose to explore the world together.”

How it works: Give $100. Get $100.

Refer a friend: Any traveler who has taken a trip with or is currently booked on tour  with EF Go Ahead Tours, EF Ultimate Break, or EF Adventures can now share a personal referral link via email, text, social media, or their respective EF World Journeys mobile app. Friends must be new to EF World Journeys, 18 or older, and have a valid email address to qualify.Both travelers earn $100: When the referred traveler books, both receive $100 in travel credit. Rewards are issued 60 days after booking confirmation, and referrals must book within six months.Earn $500 on every fifth referral: Referring travelers receive $500 for every fifth successful referral. There is no limit to how many referrals can be made, and rewards NEVER expire.

To celebrate the launch of the new referral program, EF Go Ahead Tours is offering an additional limited-time incentive. For the month of May 2026, travelers who refer a friend that books an EF Go Ahead Tours trip will receive an extra $100 referral reward on top of the standard program credit. The promotional bonus applies exclusively to EF Go Ahead Tours bookings and is available for a limited time.

One program. Three brands. Built for every kind of traveler.

EF World Journeys’ referral benefits are available when booking across its entire portfolio of guided, experiential travel companies, allowing travelers to earn and share rewards regardless of which tour operator they or their friends or family choose.

EF Go Ahead Tours offers curated guided travel for adults of all ages, including multi-generational travel groups and private or customized group tours.EF Ultimate Break serves travelers ages 18–35 with social, immersive itineraries.EF Adventures provides hiking, biking, and multi-adventure trips for active adults with a focus on lifelong learning, wellness and community.

Because the referral program spans all three tour operators at EF World Journeys, credits can move naturally within families and friend networks whose travel styles differ.

For example, a traveler who just had a life-changing trip on EF Go Ahead Tours’ A Week in Greece can refer her college-aged daughter to EF Ultimate Break’s Europe’s Icons: London, Paris & Rome and both receive $100 towards their next tour. She can then refer her basketball coach who is a hiking enthusiast to EF Adventure’s Italy Hiking: The Dolomites — and earn again.

This cross brand traveler benefit ensures that no matter how or where someone chooses to book travel across EF Go Ahead Tours, EF Ultimate Break, or EF Adventures – the rewards follow.

For EF Go Ahead Tours, please visit: https://www.goaheadtours.com/about/referrals
For EF Ultimate Break, please visit: https://www.efultimatebreak.com/traveling-with-us/refer-a-friend
For EF Adventures, please visit: https://www.efadventures.com/about/referrals-program

About EF World Journeys
EF World Journeys  is a leader in guided, experiential travel. We connect cultures, communities, and people through guided, group travel with leading tour operator brands like EF Ultimate Break (adults 18-35), EF Go Ahead Tours (adults 35+), and our newest brand, EF Adventures, focused on adventure tours for the active traveler in you. EF World Journeys is part of EF Education First. For over 60 years, EF has planned guided tours with a focus on education and cultural immersion. EF offers travelers 24/7 global support, affordable payment plans, and supports tours in more than 400 destinations worldwide. Since 1965, EF has been committed to opening the world through education. At EF World Journeys, we do just that, helping people of all ages experience the magic of travel, connecting travelers with new places, cultures, and, best of all, a diverse community of people excited to explore the world.

About EF Go Ahead Tours
EF Go Ahead Tours offers more than 200 guided trips across six continents. Each carefully planned, expertly led tour makes it easy for curious travelers of all ages to get to the heart of a destination. With a maximum group size well below the industry average, each trip has the perfect balance of planned sightseeing and free time to explore.

EF Go Ahead Tours is a tour operator brand within EF World Journeys, one of North America’s leading guided, experiential travel companies.

Join EF Go Ahead Tours’ affiliate program, supported by AWIN and earn commissions on booked tours.

About EF Ultimate Break
EF Ultimate Break is the best way to experience the world for anyone 18-35. With over 175 trips, we handle logistics for everything that makes travel a great experience from accommodations to flights to amazing tour directors to memory-making excursions. Our affordable interest-free payment plans make international travel possible for every traveler. EF Ultimate Break is part of EF World Journeys, a leader in guided, experiential travel with tour operator brands that also include EF Go Ahead Tours (adults 35+) and EF Adventures (all ages, 14+ with adult supervision). 

Are you an influencer or creator who wants to lead tours with your growing audience? Earn commissions on each booking by joining our influencer-hosted tour program

Media partners can now participate in EF Ultimate Break’s affiliate marketing program and earn commissions for tour bookings. Click here to learn more.

About EF Adventures
EF Adventures is an education-based adventure travel company offering 40+ guided tours across 25 countries and 5 continents. Launched in September 2024 as part of the EF World Journeys family of experiential travel brands, EF Adventures builds on more than 30 years of EF’s global expertise in educational and cultural immersion.

Each small-group tour blends active exploration with authentic learning, inviting travelers to engage with local traditions, communities, and ecosystems through guided experiences like hiking, biking, and multi-adventure activities such as kayaking, yoga, ziplining, and more. Designed for varied fitness levels and age groups, the EF Adventures experience combines adventure-based activity with hands-on cultural discovery that transforms how people see the world.

EF Adventures invites publishers and creators to become part of its growing affiliate network. Earn competitive commissions on confirmed bookings by referring travelers to efadventures.com. Learn more and apply here.

View original content to download multimedia:https://www.prnewswire.com/news-releases/tell-a-friend-save-on-travel-ef-world-journeys-launches-cross-brand-referral-program-that-rewards-travelers-to-inspire-the-people-in-their-lives-to-tour-the-globe-302761895.html

SOURCE EF World Journeys

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NEO Battery Partners with Highest-Ranking ROK Army’s Capital Defense Command for Defense Drone & Robotics Batteries

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Defense technology partnership with Republic of Korea (“ROK) Army’s Capital Defense Command (“CDC”), one of the highest-ranking command units responsible for securing the Presidential Office, the capital and key national infrastructureFocuses on battery supply and integration within CDC defense drone and robotics units, featuring specialized drone training and technical battery advisoryLeverages the CDC’s decision-making authority to accelerate the adoption of Korea-made battery technology across broader national defense and military units

TORONTO, May 6, 2026 /CNW/ – NEO Battery Materials Ltd. (“NEO” or the “Company”) (TSXV: NBM) (OTC: NBMFF), a low-cost, silicon-enhanced battery developer that enables longer-running, rapid-charging batteries for drones, robotics, and physical AI, is pleased to announce it has entered into a significant defense partnership agreement (the “Agreement”) with the Republic of Korea (“ROK”) Army’s Capital Defense Command (CDC) – a direct reporting unit to the President of South Korea and the Joint Chiefs of Staff. Stationed in Seoul and known as the “Shield Unit”, the CDC is one of the highest-ranking national command units, responsible for protecting the Presidential Office (Blue House), the capital and key national infrastructure.

This partnership represents a strategic expansion into a higher command level within the ROK Army, operating directly under the Army Headquarters with significant decision-making and procurement authority. The Agreement builds on NEO’s momentum in its Korean Defense Integration Strategy (see previously announced partnerships with the 12th Infantry Division dated April 1, 2026, and the Capital Mechanized Infantry Division dated April 22, 2026), and serves as a critical milestone due to the CDC’s ability to advocate for the prompt implementation of non-Chinese battery solutions that meet stringent security clearance and performance requirements.

The Agreement will focus on the supply and deployment of high-performance, defense batteries within the CDC’s drone and robotics units to enhance operational runtime and energy efficiency. Furthermore along with Korean drone partners, NEO will provide specialized drone training and technical battery advisory to support CDC’s personnel, all of whom are required to be certified in drone operations. This Agreement followed a successful live demonstration of NEO’s high-energy drone batteries held at the CDC’s parade ground on April 30, 2026.

Lieutenant General Changjoon Eo, Commander of the Capital Defense Command, expressed, “The CDC was highly impressed with the drone flight time performance exhibited by NEO’s high-performance batteries compared to commercial Chinese products. As the ROK Army and its units initiate the transition towards a Korea-made supply chain, NEO Battery will act as an integral partner for the CDC and its sub-units to ensure traceability and performance for defense batteries in our drone and robotics platforms.”

“Securing this partnership with a high-ranking command unit such as the CDC further validates the effectiveness of NEO’s battery technology,” stated Spencer Huh, President & CEO of NEO. “As the CDC is a heavy consumer of drone technology and requires high-performance, non-Chinese components to ensure national security, NEO’s in-country presence, along with our robust performance data and wide technology offering, aptly positions us to meet stringent scopes of work for the highest levels of the ROK military.”

About the ROK Army’s Capital Defense Command
Operating under the name “Shield Unit” or Chungjeongdae, the ROK Army’s Capital Defense Command is one of the highest-ranking, corps-level military organizations within the Republic of Korea’s Armed Forces and Operations Command. The CDC is primarily responsible for defending the Presidential Office, the capital, the Ministry of National Defense facilities, major government buildings, and key national infrastructure. The Command exercises several subordinate units, including the 1st Security Group, the 1st Air Defense Brigade, the CDC Military Police Group, and the 52nd and 56th Infantry Divisions.

About NEO Battery Materials Ltd.
NEO Battery Materials is a Canadian-South Korean battery technology company focused on developing and producing silicon-enhanced lithium-ion batteries in drones, robotics, physical AI, electric vehicles, and energy storage systems. With a patent-protected, low-cost silicon manufacturing process, NEO Battery enables longer-running and ultra-fast charging properties and provides end-to-end battery solutions from materials selection, cell architecture, and process optimization. The Company aims to be a globally-leading producer of high-performance lithium-ion batteries and materials, building a secure, robust battery supply chain for Western manufacturers. For more information, please visit the Company’s website at: https://www.neobatterymaterials.com/.

On Behalf of the Board of Directors
Spencer Huh
Director, President, and CEO

This news release includes certain forward-looking statements as well as management’s objectives, strategies, beliefs and intentions. All information contained herein that is not clearly historical in nature may constitute forward-looking information. Generally, such forward-looking information can be identified notably by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or state that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved”. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: volatile stock prices; the general global markets and economic conditions; the possibility of write-downs and impairments; the risk associated with the research and development of battery-related technologies; the risk associated with the effectiveness and feasibility of battery material, electrode, and cell technologies that have not yet been tested or proven on commercial scale or under real-world operating conditions; the risks associated with battery-related manufacturing process scale-up, including maintaining consistent material, component, and cell quality, production yields, and process reproducibility at a pilot, semi-commercial, or commercial scale; the risks associated with compatibility of existing battery chemistries, formulations, components, or designs; unforeseen risks associated with entering into and maintaining collaborations, joint ventures, partnerships, or commercial contracts with battery cell manufacturers, original equipment manufacturers, and various companies in the global battery and downstream end-user supply chain; the risks associated with the failure to develop and produce commercially viable battery-related products or that technical goals may not be achieved within expected timelines or budgets under a joint development or collaboration; the risks associated with the Company’s technologies and products not meeting performance requirements or customer specifications; the risks that prototype and pilot-scale products do not advance into commercially produced products or translate into commercial orders; the risk associated with battery components and cell purchase orders and offtake supply that may not be fulfilled in full, on time, or at all as actual revenue realization depends on delivery schedules, achievement of technical milestones, and customer acceptance and validation; the risk associated with losing official vendor registration or status with existing customers; counterparty risk upon delivery of prototype and commercial products; the risks associated with constructing, completing, securing, and financing pilot, semi-commercial, and commercial battery materials, components, and cell manufacturing facilities including the Canadian and South Korean facilities; the risks associated with potential delays or increased costs with site preparation, equipment procurement and installation, and facility commissioning; the risks associated with integrating silicon anode material production, electrode manufacturing, and cell assembly within a single operational cluster or the Company’s business portfolio; the risks associated with supply chain disruptions or cost fluctuations in raw materials, processing chemicals, and additive prices, impacting production costs and commercial viability; the risks associated with uninsurable risks arising during the course of research, development and production; competition faced by the Company in securing experienced personnel, contracts and sales, and financing; access to adequate infrastructure and resources to support battery materials, components, and cell research and development activities; the risks associated with changes in the technology regulatory regime governing the Company; the risks associated with the timely execution of the Company’s strategies and business plans; the risks associated with the lithium-ion battery industry and end-users’ demand and adoption of the Company’s silicon anode technology and battery products; market adoption and integration challenges, including the difficulty of incorporating silicon anodes and silicon battery products within battery manufacturers and OEMs’ systems; the risks associated with the various environmental and political regulations the Company is subject to; risks related to regulatory and permitting delays; the reliance on key personnel; liquidity risks; the risk of litigation; risk management; and other risk factors as identified in the Company’s recent Financial Statements and MD&A and in recent securities filings for the Company which are available on www.sedarplus.ca. Forward-looking information is based on assumptions management believes to be reasonable at the time such statements are made, including but not limited to, continued R&D and commercialization activities, no material adverse change in precursor, raw material, equipment, and relevant cost prices, development and commercialization plans to proceed in accordance with plans and such plans to achieve their stated expected outcomes, receipt of required regulatory approvals, and such other assumptions and factors as set out herein. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in the forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such forward-looking information. Such forward-looking information has been provided for the purpose of assisting investors in understanding the Company’s business, operations, research and development, and commercialization plans and may not be appropriate for other purposes. Accordingly, readers should not place undue reliance on forward-looking information. Forward-looking information is made as of the date of this presentation, and the Company does not undertake to update such forward-looking information except in accordance with applicable securities laws.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

SOURCE NEO Battery Materials Ltd.

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