Wix.com Ltd.

Good day and thank you for standing by. Welcome to the Wix.com conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Emily Liu, Investor Relations Analyst. Emily, please go ahead.

Thanks, Chris, and good morning, everyone. Welcome to WIX's fourth quarter and full year 2022 earnings call. Joining me today to discuss our results are Avishai Abrahami, CEO and co-founder, Nir Zohar, our president and COO, and Lior Shemesh, our CFO. During this call, we may make forward-looking statements, and these statements are based on current expectations and assumptions. Please consider the risk factors included in our press release and most recent Form 20F that could cause our actual results to differ materially from these forward-looking statements. We do not undertake any obligation to update these forward-looking statements. In addition, we will comment on non-GAAP financial results and key operating metrics. you can find all reconciliations between our GAAP and non-GAAP results in the earnings materials and in our interactive analyst center on the investor relations section of our website, investors.wix.com. With that, I'll turn the call over to Abhishek.

Thanks, Emily, and good morning, everyone. 2022 certainly was a challenging year, but I'm happy to say that we finished on a strong note. and we are entering 2023 a more efficient company with a clear path to increasing profitability. Our Q4 results illustrated our ability to respond to the changing environment. We generated $52 million in free cash flow in Q4, our highest quarter ever, and ahead of our guidance. Revenue in Q4 grew to $355 million, Also, ahead of our guidance, our increased focus on finding efficiency and closely managing cost growth allowed us to drive considerable operating leverage during the quarter. We will maintain this focus for the coming years, and I believe it will enable us to emerge from this time as an even stronger company. Throughout 2022, we managed several challenges changes, including persistent inflation, forex volatility, the invasion of Ukraine, and overall global uncertainty. This is all on top of consumer behavior on the internet resetting to pre-COVID levels. Despite these headwinds, the strong fundamentals of our business, along with continued successful execution, resulted in revenue growth and profitability finishing strong. Revenue in 2022 grew 9% year-over-year to $1.4 billion on a constant currency basis. Revenue grew 11% year-over-year. Much of this growth was driven by our partner's business, with partner revenues growing 29% year-over-year as we continue to successfully capture more of the professional market. Nir will share a bit more about our latest potential operational updates in a few minutes, and Lior will then dive into 2022 financial results as well as our outlook for the coming year. But before that, I want to provide some more details on how we are evolving our marketing strategy to create greater amount of efficiency with this investment. As we mentioned last quarter, in September, we began to test, test to adjust our marketing approach to focus on higher-intent users. We accelerated this testing throughout Q4, reducing our acquisition marketing investment by nearly 50% in the quarter compared to the previous year. The results of doing this were fantastic. Despite reducing acquisition marketing by half, we have seen stable new cohort bookings. We believe the driver of this success is the strength of our brand. Our investment in building a global brand over the past 15 years have made Wix synonymous with relevant general keywords on the internet. We plan to continue this new marketing strategy and expect investment in acquisition marketing to remain at these reduced levels throughout 2023. We also plan to shift dollars to invest more into our brand to drive future growth. While we increase focus on operation efficiency, our strategy to build the best platform and amazing product for millions of users of all types around the world has remained unchanged. I am extremely excited to highlight the recent launch of Wix website creation with ChatGPT, where ChatGPT is used to create text and content in a website. This product combines our leading innovation in website creation with our expertise in AI technology, which started with the market-first introduction of Wix ADI in 2016. AI Text Creator uses OpenAI's ChatGPT to allow users to add specific text and create professional content on their website easily within seconds. Removing the pain point of content writing and generally improving the user experience. We are implementing AI technology in a number of other ways as well. And I'm excited for the pipeline of amazing product we have in store for 2023. Before I turn it over to Nir, I want to take a moment to extend my gratitude to the entire Wix team. I'm very proud of the way the team managed for this last year. Particularly, teammates who have been and continue to be directly impacted by the war and the crime. Our thoughts remain with you and your families. Because of all of you and the incredible work you do, the potential of WICs in 2023 and beyond is unbounded, and I'm excited for what is yet to come. With that, Nir, over to you.