Wix.com Ltd.WIXNASDAQ
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Operator: Good day, and thank you for standing by. Welcome to Wix.com Ltd. Fourth Quarter 2025 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentations, there will be a question-and-answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 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. Please go ahead.
Emily Liu: Thanks, and good morning, everyone. Welcome to Wix.com Ltd.'s Fourth Quarter and Full Year 2025 earnings call. Joining me today to discuss our results are Avishai Abrahami, CEO and Co-Founder, Nir Zohar, President and Co-Founder, 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 20-F 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 will turn the call over to Avishai.
Avishai Abrahami: Thanks, Emily. 2026 is shaping up to be a defining year and the start of a new chapter shaped not just by the continued shift toward AI, but by AI beginning to prove its real-world value and utility more broadly. At Wix.com Ltd., we expect to begin to see the bold bets we have made over the past few years translate into measurable impact. When we founded Wix.com Ltd. twenty years ago, our vision was straightforward. Make Wix.com Ltd. the go-to platform for anyone, anywhere to create online. Over the years, we have delivered on that ambition. What started as a simple do-it-yourself website builder has grown into the leading online presence creation platform serving not just self creators, but also businesses of all sizes as well as professional designers and developers. In recent years, the web has undoubtedly become much more AI-first. That shift is redefining how and what people build online. AI has dramatically expanded the world of what is possible and created new dimensions that had not existed before. As a result, Wix.com Ltd.'s market opportunity today is exponentially larger than in 2025, primarily driven by our expansion into the application space facilitated by our acquisition of Base 44. This total addressable market expansion has advanced us leaps and bounds towards achieving that long-term vision of being the go-to place for anyone to build whatever they can imagine online. With the addition of Base 44 to our platform, users can now build tailored software applications, smart mobile applications, pro-level visual content, and, of course, websites, but so much more powerful and sophisticated than ever before. These are all things you can create on Wix.com Ltd. today, which is incredible, but the possibilities ahead are much, much bigger. Importantly, as our business and time have evolved over the past twenty years, and will continue to evolve over the next twenty, we remain focused on simplifying very complex technologies and making them accessible to anyone and everyone. Today, there are two new cornerstone offerings to advance our vision. The first is Wix Harmony. Wix Harmony is the first-of-its-kind website creation platform that blends intuitive visual editing with the flexibility and power of Vibe coding. Wix Harmony provides a unified AI layer that spans across the full Wix.com Ltd. experience, allowing for a real AI partner to be with you every step of the way as you create, manage, and grow an online presence or business. After launching in English in January, we are now expanding Wix Harmony globally in other languages, and I am very pleased with the early performance we are seeing, particularly across conversion and monetization metrics. We believe Wix Harmony has the potential to fundamentally reshape how individuals and small businesses build and scale online, not just on Wix.com Ltd., but across the Internet as it becomes increasingly AI-driven. Over time, we plan to gradually make Harmony the default experience for new and existing users, an evolution we anticipate will drive meaningful long-term impact across conversion, engagement, retention, and monetization. The second new pillar of our strategy is Base 44, our leading Vibe coding platform that expands our reach into the vast world of software creation and significantly grows our TAM. We are equally ambitious in this new world as we are in the world of website creation. Through innovation and strong marketing execution, Base 44's user base is scaling rapidly. Today, the number of new users joining Base 44 is nearly two-thirds of the number of new users joining Wix.com Ltd. This is an indicator of the platform's accelerating momentum and highlights the opportunity ahead to empower a massive and compounding cohort of users to build whatever they want online. Just one year after Mauer founded the company and nine months after our acquisition, Base 44 recently reached approximately $100,000,000 of ARR, placing it among the fastest growing software platforms in history. While Base 44 is already emerging as a top platform to build lightweight personal projects, we are seeing adoption from a growing community of businesses and enterprise-sized organizations too. Companies in the tech, banking, and healthcare industries, as well as government organizations and nonprofits, are using Base 44 to build customized software solutions. We are seeing users develop their own CRM capabilities, product and project management tools, ERP systems, workflow automation frameworks, and financial reporting applications. Importantly, this momentum and growth is completely organic. With no sales team at Base 44 today, self-propelled adoption by enterprise-size organizations demonstrates the strength of the platform as well as our successful marketing execution. As much as we are pleased by the success so far, I believe the real potential still lies ahead as Vibe coding permeates beyond early tech-forward adopters to the broad online population. I have not been this excited to kick off a new year in a long time. In just the first two months, we have made bold moves across both our product roadmap and capital strategy, which Nir will speak about shortly. We are confident in our strategy, our ability to execute, and the opportunity in front of us as the Internet shifts further towards AI. Wix.com Ltd. is reshaping how people create in this AI era and significantly expanding what is possible to build online. With that, I will turn it over to Nir.
Nir Zohar: Thanks, Avishai. I would like to start with Q4 user cohort trends and what we are seeing there today before discussing our capital strategy and the announcement made today. As we closed out 2025, our new user cohorts exited the year with strong momentum. In the core Wix.com Ltd. business, new cohort bookings maintained double-digit growth in the fourth quarter, fueled by a healthy top of funnel, higher conversion from free to paid subscriptions in key markets, and increased monetization per user. When we include Base 44, new cohort bookings growth accelerated very meaningfully quarter over quarter, driven by particularly robust demand for Vibe coding capabilities. This strength we saw in our new cohorts also extended to existing core Wix.com Ltd. users. Our users are more active, engaged, and impactful than ever, demonstrated by resilient revenue retention in 2025. With net revenue retention of 105% in 2025, we nearly matched the strong retention we saw in 2024 despite the persistent GPV headwinds throughout 2025. This demonstrates that the inherent stickiness and creation power of our user base continues to improve. The strength of this user base supported by high retention and growing user value is also reflected in the projected ten-year value of existing cohorts, which grew 14% year over year. For the first time ever, we now project over $20,000,000,000 in future bookings over the next decade from current Wix.com Ltd. users. This opportunity exists within just our core Wix.com Ltd. business and does not yet include Base 44, where the potential is both new and much larger. Throughout the year, we continued to increase user value as both new and existing users demonstrated better monetization. This was a result of a steady shift toward higher-tier subscriptions, greater adoption of business solutions, and GPV growth. Paid subscription volume in our key markets, particularly in the U.S., where we generate a majority of our revenue, increased year over year in 2025. Additionally, business subscriptions made up a significantly larger share of our total subscription mix in 2025 compared to 2024. Looking into 2026, these positive cohort dynamics are gaining more momentum in these early months of the year. New cohort bookings growth in the core Wix.com Ltd. business has accelerated compared to last year's already very strong cohort growth. This is a direct result of Wix Harmony, which is helping both new and existing cohorts convert more effectively, build more, and capture greater value. Finally, before I turn it over to Lior to walk through our financial and 2026 expectations, I would like to make a few comments on our repurchase plans for this year and the equity investment we announced this morning. As you heard from Avishai, we have a bold and ambitious strategy centered around reshaping the possibilities of online creation over the next few years. We believe the products we are building today will drive accelerating growth in the core Wix.com Ltd. business over time, as we extend our leadership as the go-to AI-powered online presence creation platform globally, notably with Wix Harmony. In tandem, we are seeing explosive growth at Base 44, which we expect will become a profitable and meaningful long-term growth engine. Accordingly, we believe that our current stock performance greatly undervalues these opportunities as well as the fundamental strength of our business. So, taking full advantage of this and demonstrating our immense conviction in our strategic plan, we expect to complete the large majority of our $2,000,000,000 repurchase program this year. We plan to do this as quickly and aggressively as we can. Sharing in our conviction, Durable Capital Partners has led a $250,000,000 equity investment in the form of a private placement of our ordinary shares and warrants. In addition to being highly respected equity investors, Henry, Anuk, and the team have been longtime supporters of Wix.com Ltd., and developed a deep understanding of our business. Their investment is a powerful endorsement of our long-term vision and ability to execute as we build the next era of the Internet. We are thrilled to partner with them as we pursue our strategy, accelerate growth, and create lasting value for our users and shareholders. With that, I will hand it over to Lior.
Lior Shemesh: Thanks, Nir. We exited 2025 with strong cohort momentum, a clear strategic plan and poised for continued growth in 2026. We are delivering on our ambitious product roadmap. At the same time, our cohorts are strengthening, as Nir discussed, driven by positive early behavior from Wix Harmony and continued outperformance of Base 44 as we expand our reach across the entire online creation journey. We expect 2026 to be a pivotal year as we make category-defining innovations and expand our leadership across the broader online ecosystem as AI tech increasingly makes the impossible now possible, setting the foundation for long-term growth acceleration. Before I get into our expectations for 2026, I want to quickly recap our Q4 and full year 2025 results. Bookings and revenue growth were healthy in the fourth quarter, building on the incredibly strong growth we saw in the same quarter last year. Total bookings in Q4 were $535,000,000, up 15% year over year, while total revenue was $524,000,000, up 14% year over year. Top-line growth was driven by strong new cohort behavior and solid retention of our existing user base in our core Wix.com Ltd. business as well as Base 44 outperformance. Base 44 finished the year with approximately $59,000,000 of ARR, above our expectations at the time of acquisition. Excitingly, Base 44 recently reached approximately $100,000,000 in ARR, a major milestone that underscores our rapid growth and growing market leadership. Strong ARR growth was driven by product innovation that has resonated, a rapidly expanding user base, improving conversion, and consistent upgrade and renewal trends. Overall strength in Q4 was tempered by continued GPV headwinds, as SMBs on the platform saw macro pressure resulting in seasonally softer than anticipated GPV on the platform. Encouragingly, higher-selling and larger businesses increasingly come to Wix.com Ltd. to build and operate their storefronts. GPV grew 11% year over year to $3,700,000,000 in the fourth quarter, and 11% year over year to $14,300,000,000 for the full year. GPV growth coupled with a steady increase in take rate throughout the year drove year-over-year transaction revenue growth of 18% in Q4 and 19% in the full year. Partners revenue grew 21% year over year to $203,000,000 in Q4, driven by solid studio performance as well as strong adoption of Google Workspace and marketing solutions. This was partially offset by the GPV headwinds I just mentioned. Turning to margins, fourth quarter total non-GAAP gross margin ticked down slightly sequentially and year over year to 68% as expected, and total non-GAAP operating income came in at 15% of revenue. Lower total non-GAAP gross margin was driven by investments in Base 44 to support its rapid growth. We continue to incur elevated AI compute cost as we scale to meet stronger than expected Base 44 demand and maximize gross profit dollars. We believe these AI costs to be front-loaded as new users consume more AI inference bandwidth during their initial build phase. We anticipate non-GAAP gross margin for Base 44 to improve sequentially throughout 2026 as we proactively optimize AI model usage and costs primarily through enhancing prompt caching, batching requests, focused model routing, and more favorable pricing from LLM providers. Approximately one-third of Base 44's AI inference cost today is attributed to token consumption of free users, and included under S&M expenses in the fourth quarter to align with industry standards. We believe AI costs incurred by free users as a percentage of total AI cost will decline over time as conversion improves. Even after incorporating AI-related costs associated with free users into cost of revenue, Base 44's non-GAAP gross margin is already positive today, reflecting healthy underlying unit economics that we believe will continue to improve. We expect Base 44 gross margin to increase as the year progresses. Higher operating expenses in the quarter were driven by accelerated advertising and branding investments into Base 44 against our tROI target, which currently stands at less than twelve months. These increased investments were anticipated as we captured elevated top-of-funnel traffic exiting the year. Non-GAAP gross margin and operating profit margin in our core Wix.com Ltd. business improved sequentially and year over year, driven by healthy top-line growth paired with a stable and disciplined operating cost base. We exited the year with free cash flow of $156,000,000 in Q4, or 30% of revenue. Fourth quarter free cash flow in the core Wix.com Ltd. business was stable compared to the previous quarter. Moving on to 2025 full year results, total bookings in 2025 grew to $2,070,000,000, up 13% year over year. Total revenue in 2025 was $1,993,000,000, an increase of 13% year over year. Total consolidated ARR was $1,836,000,000 at the end of year, up 14% year over year. Total non-GAAP gross margin was stable for the full year, while non-GAAP operating margin declined modestly as investments in Base 44 offset non-GAAP growth and operating margin expansion in the core Wix.com Ltd. business. We generated free cash flow excluding acquisition-related expenses of $605,000,000, or a milestone 30% of revenue in 2025. Turning now to what we expect in 2026. With new cohort momentum driven by Wix Harmony and the continued outperformance of Base 44, we anticipate bookings and revenue growth to accelerate this year. Before I get into the numbers, I want to comment quickly on our updated guidance philosophy. As innovation evolves our opportunity set and expands Wix.com Ltd.'s TAM into new areas, we are refining our guidance approach to reflect a broader range of potential outcomes. So for the full year 2026, we expect bookings and revenue for the consolidated business to grow at mid-teens percentage year over year. For 2026, we expect revenue for the consolidated business to grow at a mid-teens percentage on a year-over-year basis. We expect innovation-driven growth to be accompanied by high-impact but disciplined investments to fully unlock the market opportunity ahead for both Wix.com Ltd. and Base 44. For the full year 2026, we expect free cash flow margin in the low to mid-20% range assuming current capital structure excluding acquisition expenses. This wider than normal guidance range reflects the dynamic hyper-growth trajectory of Base 44 and the inherent variability that accompanies this level of rapid growth. We are playing to win and are willing to make the necessary investments in order to scale Base 44 into the market leader. So if Base 44 top-line growth outperforms more meaningfully, we may experience further pressure on near-term free cash flow margins. In our core Wix.com Ltd. business, we expect solid bookings and revenue performance with flat to expanding free cash flow margin for full year 2026. In addition to accounting for our current capital structure and the exclusion of acquisition costs, this expectation also takes into account, one, a material currency headwind on our total payroll expense base net of our hedging activity as the U.S. dollar continues to significantly weaken against the Israeli shekel; two, negligible AI inference costs associated with Wix Harmony as a result of proactive infrastructure optimization completed last year. 2026 is shaping up to be a foundational year as we drive forward innovations that we believe will cement Wix.com Ltd.'s leadership and expand our role across an evolving online creation ecosystem. Operator, we are now ready for questions.
Operator: Thank you. As a reminder, to ask a question, please press 11 on your telephone and wait for your name to be announced. To withdraw your question, please press 11 again. Our first question comes from the line of Brad Erickson with RBC Capital Markets. Your line is now open.
Brad Erickson: Guys, thanks for taking my question. I have a couple. First, if we look at the organic growth you are embedding into the full year bookings guide, can you lay out and maybe rank some of the contributors there between, you know, thinking about things like payment volumes or subscriber mix shift or pricing? So start there.
Lior Shemesh: Hey. This is Lior. So we do not assume a significant change. We do not assume any increase in pricing or change in pricing. I believe that the entire guidance that we provided for 2026 actually reflects the growth that we see within the Wix.com Ltd. core business and Base 44. But beside that, I cannot indicate something that is kind of extraordinary. The same goes for GPV payments and so on.
Brad Erickson: Understood. That is helpful. Thanks. And then just stepping back, what types of businesses or applications are you seeing users set up with Base 44? And how much crossover is there with what you see on Wix.com Ltd.'s core platform? Are they, would you say, kind of a decidedly different customer profile, or do you see some of those folks making a choice between the two? Thanks.
Avishai Abrahami: We see many different kinds of applications. People are building things for themselves, their family, and then personal growth applications, all the way for applications for the business, for their enterprise application machine. And replacement in companies, SDR, estimations, a lot of different things. Really, it is a huge variety. I think that is one of the things that makes us so excited about Base 44. It looks like people are so creative and the TAM for that, because of that, is essentially infinite. We do not see any kind of competition, and you can see that they are very mostly different usage also, as you can see now. Clearly, Harmony is accelerating, Base 44 is accelerating. So, obviously, we do not think they take from each other. Right?
Brad Erickson: Got it. Thanks.
Operator: Thank you. Our next question comes from the line of Josh Beck with Raymond James. Your line is now open.
Josh Beck: Thank you for taking the question. Kind of a higher-level question with Base 44. It seems like it is skewing upmarket, and then, obviously, Harmony is kind of more geared towards the self creator. So do you see those trends persisting in terms of the segmentation? And how far upmarket do you expect Base 44 to go? And then a financial question related to Base 44. Lior, I believe you said about a third of the inference costs are coming from the free users. I think that is kind of a snapshot for today. Is that happening maybe quicker than you had anticipated, meaning the conversion of free to paid is happening at a pace maybe above your expectations? Would love some comments there. Thank you.
Nir Zohar: Hey. It is me. I will take the first one. In terms of the self creators question and the more upmarket, I think definitely on the Harmony side, Harmony is a product we built for the self creators. So I think the association you are making between self creators and Harmony is the right one. For Base 44, as Avishai just said before, the range of opportunities in terms of the kind of usage is still extremely wide. And it makes sense. It is really a very vast TAM in the making, and it is expanding all the time. So we are seeing all kinds of usages. By the way, I think we are definitely also seeing a lot of personal use as well on Base 44. And there, I think it is too early to say whether it is more of one or the other. And to be honest, I think we are going to work very hard to help it segment over time to try and win on both ends for Base 44.
Lior Shemesh: I will take the second question. Yes, about one-third as of now is related to free users. Look, I believe that when we started it was higher than that. I think that we keep on increasing conversion, which is a really, really good sign. And we also become much more efficient in terms of how we use the model between the different types of users. So I do believe that the portion related to that will decrease in the future, as the overall cost will decrease.
Josh Beck: Very helpful. Thanks, guys. Thank you.
Operator: Our next question comes from the line of Ken Wong with Oppenheimer and Company. Your line is now open.
Ken Wong: Thanks for taking my question. Great to see the amazing Base 44 outcome. Can you give us a sense for what accelerated that growth sequentially? And I realize you are still working through some of the details, would love to get a sense for what the Base ARR bookings look like in fiscal 2026 that is reflected in the free cash flow margin guide of low to mid twenties?
Lior Shemesh: So, yes, we do see an acceleration and, in a way, also better than what we expected. I think that the fact that we have already gotten to $100,000,000 of ARR actually reflects that. And with regard to the assumptions about the bookings, we do not break it down between Wix.com Ltd. and Base 44. You know, we believe that it is already an organic product internally, and we are not relating it separately. You know, a big part of Base 44 growth is actually based on the synergy with Wix.com Ltd., and it is super important to understand it. Therefore, we are not going to provide separately between Base 44 and Wix.com Ltd., but we did mention the ARR and also the growth of the ARR that should give you a very good indication of what we assume with regard to that. We are very optimistic about it.
Ken Wong: Fantastic. And then if I could have just a quick follow-up. I think the early guide was that you would see second-half acceleration of the core, specifically partners. It does seem like it maybe downticked a little bit. We would just love to get any color from you in terms of what you saw in Q4 on the core legacy base business? I mean, Wix.com Ltd. business. Sorry?
Lior Shemesh: Yeah. Sure. We actually saw acceleration in Q4 from partners. I mean, we said from the very beginning of the year that we will see acceleration of core Wix.com Ltd. in the second half of the year. This is exactly what happened. The only thing that was not expected is some kind of modest softness in GPV. That was partially compensated by the fact that we see a better growth in terms of subscriptions. So I think that if you look at the second half of the year for Wix.com Ltd., we actually did see some acceleration also in the fourth quarter, mostly coming from our creative subscriptions.
Ken Wong: Fantastic. Thank you very much.
Operator: Thank you. Our next question comes from the line of Andrew Boone with Citizens. Your line is now open.
Andrew Boone: Thanks so much for taking my questions. I am sorry, I am at the airport; there is a little bit of conversation going on. Can I ask, in terms of Base 44 and LTV, if I think about the payback period of one year, how do we think about that now that you are just having customers that are hitting that one-year mark? How are you guys estimating the LTV or the payback period using that framework as you guys define CAC for Base 44? And then I would love to ask, it looks like about $30,000,000 of acquisition cost in 2025. Can you guys ring-fence what that would look like for 2026 and how we should think about that within the free cash flow guide?
Lior Shemesh: Thank you so much. Sure. So you are right. I mean, Base is a very young company, very young product. And, by the way, this is why we are very also conservative about the guidance. But right now, based on the information that we have, based on the history that we already have, we are looking at less than one year of tROI and this is how we manage the acquisition cost. I think that it is very important to mention right now that we are investing for growth. We are not necessarily trying to optimize our gross margin. We are optimizing dollar profit. And right now, we intend to invest in growth. And, by the way, you can see that also reflected in part of our free cash flow guidance. So with regard to the tROI, by the way, it is the same Wix.com Ltd. playbook that we have used for many, many years, and we are very good at it. With regard to the $30,000,000 acquisition cost in 2025, definitely, it is going to be higher in 2026 because we see the demand in the market and, as I mentioned before, we plan to pursue that. We plan to go and make sure that we will continue to get a lot of market share and expand this business. We see a great potential about this business.
Andrew Boone: Thank you.
Operator: Thank you. Our next question comes from the line of Deepak Mathivanan with Cantor Fitzgerald. Your line is now open.
Deepak Mathivanan: Hey, guys. Thanks for taking this. So one on Harmony and then one on OpenAI partnership. First, you noted that with the early region Harmony, you are seeing improving conversion. What type of users are you seeing initially? Are you seeing perhaps more sophisticated tech users adding advanced capabilities to their websites with some of the more traditional SMBs? Is Harmony helping the capabilities of the websites become more at all in the early days? Can you talk a little bit about that? And then on the partnership with OpenAI for Apps SDK, in addition to just integrating for a new website creation when Wix.com Ltd. is invoked as an app, what are some of the other benefits in terms of how ChatGPT is navigating the website created by Wix.com Ltd. that you are potentially seeing? Any color you can add on how deeper this partnership can evolve over time. Thank you so much.
Avishai Abrahami: Of course. So for the first part, we are pretty much seeing everybody using Harmony that was using Wix.com Ltd. before. So it is everything from personal websites to the hair salon website to large company and enterprises, so pretty much everybody. At this stage, Harmony does not support a database, but that will be added soon. So a bit less ticketing and websites, but nothing major. As for your other question, can you repeat it, please? It was breaking for me.
Deepak Mathivanan: Sure. In addition to the apps partnership with OpenAI, do you see potential opportunities in terms of how Wix.com Ltd. websites are navigated and searched by OpenAI in the future, particularly ChatGPT?
Avishai Abrahami: Well, yeah, of course. I think that it is a very big subject. I think that all we are seeing, and if you remember a year ago, I spoke about the fact that it is very unlikely that the LLM companies will build in back for the various services, and so they are probably not going to build all the e-commerce stuff and are not going to build databases for businesses. They are going to bring the layer of intelligence on top of that. And this is just one example where we allow Wix.com Ltd. users to build, with the intelligence that OpenAI provides, their website. Right? It is even more interesting because it is an intelligence which is talking to the intelligence of the site. I mean, this creates tremendous opportunities for the future. There is so much more we can do there. And because it is not APIs in the standard way, it is essentially two intelligences that are discussing and working together to give you a website. And that is a fantastic pattern that can be grown a lot. As for how OpenAI or any other LLM can read Wix.com Ltd. sites, we support pretty much everything. We support, of course, make text. If our customers choose so, we can make the text visible and easy to crawl and built in a way that is very easy for the LLMs to process. And we also have ways so we can give the LLMs more than just the content that we normally offer over the website, because LLMs like to read a lot of content, when humans tend to want to read less. So this is one option. We, of course, support the ICP on every Wix.com Ltd. website and pretty much every ad standard. I think that this is not a small step in the long roadmap of how we collaborate and create the new Internet, an agent Internet, but for humans. So you still need the visualizer, still need the designer, still need to buy products. However, you want to create the ability for it to work together for humans to have a better experience. Got it. Thanks, Deepak.
Operator: Thank you. Our next question comes from the line of Trevor Young with Barclays. Your line is now open.
Trevor Young: Great. Thanks. First question, just on premium subs. The decline persisting there even when layering in Base 44. I appreciate the commentary that growth in key markets like the U.S. was positive. That metric is still negative for the second year in a row. Why is that? And how much more churn is there among these lower-value subs?
Nir Zohar: Hi, Trevor. It is me here. So I think, as a reminder, this is very much aligned with our strategy around bringing value to the cohorts and prioritizing, I think, cohort value over the subs. And it is something we have been pursuing for a few years now and have been talking about. And, again, throughout the year, we have seen more opportunities around geographies and areas where we can go higher-value subscription, which is why we prefer to go after those. So you can, obviously, see the lower net subs, but you are seeing the higher value that comes into the cohorts over time.
Trevor Young: Thanks for that, Nir. And just a follow-up question. How should we think about the composition of growth between self creator and partner in 2026? Is partner now kind of like a low-twenties grower, or could that slow further? And then on self creator, clearly, that will pick up from the contribution from Base 44. But should we assume that the core Self Creator business remains stable given that Harmony is coming in at the same price points as the older Editor product? Thank you.
Lior Shemesh: Yes. I think that for self creator, you should assume that it is stable. Actually, when you think about it, we do see some acceleration in terms of the new cohorts. I think that we already indicated that in the performance of Harmony. So it mostly has a very positive impact on self creators, especially for the new cohorts. Remember that most of the cohorts are already performing, meaning that most of the effects of Harmony is on new cohorts. So we are going to see that over time. With regard to partners, we have a lot of innovation that we are going to do in the near future. But also, Trevor, remember that Base 44 has a ton of interesting things for our partners that they can actually use for their customers, and it is more revenue stream for them. So we believe that although right now most of it is self creator-led, we believe that it is a great opportunity also for partners to use Base 44 in the future.
Trevor Young: Thanks, Lior. Thank you.
Operator: Our next question comes from the line of Mark Zegutovich with Benchmark. Your line is now open. Mark, do you want—
Mark Zegutovich: Thank you. Question on Harmony, then I had a follow-up on your partnerships. But on Harmony, just curious what the early cohort KPIs that you are seeing there in terms of conversion, ARPU, attach rate, churn, relative to the traditional cohorts and how durable you see these KPIs across your geos?
Lior Shemesh: So I will start with Harmony. As we mentioned, we see a very good performance of the new cohorts. We actually see a better conversion, faster monetization, and also higher ARPU. So we believe, we hope that this strong trend will continue. Again, I think that it is too early, but we feel very positive about the first reaction and performance of this product, which, in a way, we expected that, but it is always nice to see that.
Mark Zegutovich: Got it. And then in terms of the LLM partnerships you have, OpenAI with Harmony and Anthropic via Base 44, curious how the economics work here and specifically the revenue split with these partners. And then within Wix.com Ltd. and ChatGPT, that framework there, what percent of new Harmony sign-ups do you expect to come here over time, and how do you manage a theoretically lower platform or take rate if these AI interfaces become your major distribution partners? Thank you.
Nir Zohar: Hey. It is me. So, first of all, obviously, we cannot go into economics we have with different deals and agreements we have with the LLM partnerships. I think it is worthwhile mentioning that we actually have quite a few different kinds of cooperations and partnerships and joint ventures with each and every one of them on completely different areas of the wide range of infrastructure that Wix.com Ltd. has and supports. On the Wix.com Ltd. side, the Base 44 side, we have been doing research with them for many, many years now, so also the research teams are very tightly connected on the Anthropic side, on the Google side, on the OpenAI side, and others. I do not think, and currently we are not assuming, any kind of impact specifically on the Wix.com Ltd. inside GPT thing. So I cannot comment on changes that are being incurred because of it. If it becomes, over time, for some reason, a much more significant stream, then, obviously, we can address that. But for the time being, we do not expect that to be significant.
Mark Zegutovich: Got it. Thank you.
Operator: Thank you. Our last question comes from the line of Mike McGovern with Bank of America. Your line is now open.
Mike McGovern: Hey. Thanks for taking my question. For Base 44, when you think about going from about $60,000,000 in ARR exiting the year to now over $100,000,000, or close to $100,000,000, in such a brief period of time, can you just double-click on what was able to accelerate that growth? I know they have added a couple key features like payments. Is there anything else in there?
Nir Zohar: So I do not think we can point to one specific product release or change. And also, you have to remember that the cadence of improvement and innovation there is massive. So there is much more that is happening all the time. But it is a combination of the ability to increase the user base, the increase in incoming first and foremost because there is more and more brand awareness. We did a Super Bowl campaign, which definitely did not hurt and was very beneficial. And the brand awareness grows, and also, I would say, as the awareness to the category grows for more and more people, obviously, the demand is increasing. And then we match that demand with our stellar marketing team that has been working very diligently to ignite and push the Base 44 growth over time. And then I would say definitely the product is improving. And also, we keep on optimizing many, many parts of both the funnel, the product, the business model. We are basically taking so many things out of the Wix.com Ltd. playbook and everything we learned over the past two decades in how to run a successful subscription business, and we applied to Base 44 in the right relevant way. And I think you are seeing the results.
Mike McGovern: Got it. And then when we think about tokens and free tokens for trial users within Base 44, much of that, when we think longer term, is somewhat self-inflicted in that S&M expense increase, and you could just lower that over time as Base 44 scales and awareness grows.
Nir Zohar: Well, I think it is a great question, and we will keep on testing and understanding where the threshold should be. We can definitely find ways to move the threshold as time progresses. We do think that having the free tokens there and having a freemium model is great because you want to give people the opportunity to test-drive, to pilot the product and try it out. And we think that, obviously, the people who are gaining value from it will continue, and those are the people we will monetize immediately. The ones who do not may come back later on, and we have seen the same thing when we were building the Wix.com Ltd. freemium model. Whereas, again, Base 44 is a very young product, on the Wix.com Ltd. cohorts, we are seeing people who are converting who joined us ten or fifteen years ago. That is amazing. So, over time, building a big cohort base where people can experience your product, love your product, but if they do not necessarily need it right now, will come back to it later is a big benefit. But that being said, we definitely think there are more things we could do to hone the business model over time, and we will align that as we go forward.
Mike McGovern: Thank you.
Operator: Thank you. This concludes the question-and-answer session. Thank you all for your participation on today’s call. This does conclude the conference. You may now disconnect.