Good morning. My name is Aurora, and I will be your conference operator today. At this time, I would like to welcome everyone to the Wix.com 2019 second quarter financial results conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. To ask a question, you may press star then one on your touch-tone phone. To withdraw your question, please press star then two. For those on webcast, you may submit your questions throughout the event by typing in the Submit a Question box on your screen. I will now hand it over to Maggie O'Donnell, Director of Investor Relations.
Good morning, everyone. Welcome to Wix's second quarter 2019 earnings call. Joining me today to discuss our results are Avishai Abrahami, CEO and Co-Founder, Nir Zohar, President and COO, and Lior Shemesh, CFO. During this call, we may make forward-looking statements. 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. You can find all reconciliations between our GAAP and non-GAAP results in our press release, presentation slides, shareholder update, and our interactive analyst center on the investor relations section of our website, investors.wix.com.
Now, I will hand it over to Avishai Abrahami, who is going to say a couple of quick words about the quarter. Avishai?
Good morning, everyone. We had another great quarter at Wix. Both collection and revenues were above our guidance, and we grew free cash flow by almost 30%. We continue to improve our overall offering and expand our reach into new markets and products. These results demonstrate the success we have had this year. A little more than a year ago at the Analyst Day, we talked about how Corvid would expand our addressable market by attracting more professionals to Wix. Today, I'm happy to say that we clearly see this is happening. The professional segment on Wix is growing faster than ever before. Not only growing, but we also see new kinds of professional using Wix, like developers and large agencies. Corvid in a professional market are just a couple of initiatives that I believe will drive growth for us next year and in the future.
As you probably expect, we have more that we will announce next year. I'm very excited for the second half of this year and for what is to come next year and beyond. Thank you for joining our call today, and now I'll return it back to Maggie.
Thank you. Please limit yourself to one question so that everyone gets a chance to ask a question. Can we have the first question, please?
Your first question today comes from Zachary Schwartzman with RBC Capital Markets. Please go ahead.
Great. Thank you. On the net sub additions, can you talk about those results and your new sub-guidance for the year? Was this solely related to pricing, and why do you expect this to re-accelerate in 2020? Thank you.
Hey, Zach, this is Lior. Sure. On February, we spoke about the overall evolution of our business and focus on maximizing the cohort lifetime value. What happened this quarter is actually a continuation to that, and I will try to explain. In the last two years, our products have improved dramatically, and we have added many new products. For example, the many features within the ADI and the editor, a lot of more robust vertical applications, Ascend, third-party apps, and obviously much more functionality coming from the Corvid. What we've decided to do, and that was back last year, we decided to increase the pricing to match those added product value.
We also increased pricing as part of the overall strategy to evolving our brand to the professional market, which we see a huge opportunity for us in the coming few years, and we spoke about it a lot. Actually, we had 2 phases. The first one started back in August 2018, where we moved the connect domain and raised prices. The second one was recently on May, when we raised prices again, obviously after testing many months the results and how the impact on the overall value of the quote. That was the most recent price change. Obviously, it caused us to update the net sub add guidance , but that was also expected. We understand that we lost along the way those premium subscription that usually choose the less priced packages.
We don't know exactly what will be the behavior in the future. They might join Wix or pay Wix in a later stage. We actually increased the value of the quote, and we provided a few graphs in order to show that. The average collection per new sub was increased by 29%.
The first half closed collection by 9%. That was actually anticipated, but we believe that after this evolution that we went through, in next year, we believe that net premiums will be accelerated again.
Great. Thanks for your question, Zach. Can we have the next question, please?
The next question comes from Deepak Mathivanan with Barclays. Please go ahead.
Hey, guys. Thanks for taking the question. The first one, I wanted to ask a little bit about the agency partner efforts. Avishai talked about it briefly as well. You announced the initiative two quarters ago. Is the team fully built out now? What were the expenses associated with this in the first half? How are you thinking about the revenue expectations in your guide from these flows, sort of in the back half of the year? Trying to kind of understand the near-term ROI of this program. A quick one on gross margin. It delivered by over 400 basis points as we kind of expected. Can you parse out the impact from customer experience build-out, G Suite, and then potentially payments contributions during 2Q? Thank you.
Yeah. With regard to the stuff about the agencies, I will start to say that most of it was already implemented. Obviously, the cost is according to track and we have a few more people to recruit, but most of the team are there, and they are working. We actually started to see the monetization of it already this quarter, and we anticipate that it will continue in the second half of the year. That was part of the fact that we are a beat and raise for the full year. Obviously, we expect that the results of it will be much more significant in the coming two years, but everything is according to track. Actually, we have really good results coming from this team. With regard to the gross margin, first of all, it's according to what we've expected.
We had some savings this quarter, some one-time savings, but the recruitment of the agents was according to the plan. I expect that the yearly gross margin will be according to what we provided. Again, we had some saving, which is also always a good surprise to have.
Okay. Thanks, Lior.
Thanks, Deepak. Can we have the next question, please?
The next question comes from Brent Thill with Jefferies. Please go ahead.
Thanks. Just back to the new premium subs. I think there's a concern that you're focusing more higher end and you're banning the low end and causing some concern that that customer base may not be as attractive to you. I'm not sure that's correct, but I'm just curious if you could just comment about how you think about the shift to the high end, but also making sure you're taking care of the lower-end and entry-level customers.
This is Avishai. I think what you're seeing is the results of two different things. The first one, of course, is the product became more evolved and more mature, and adds functionality, advanced functionality like Ascend and Corvid. We have the potential of going toward, of course, a higher paying customer base and more sophisticated professionals. On the other hand, we made a decision last year to remove the cheaper package that we have, which was a connected domain. We did that mostly because we felt that customer that got it didn't get the same kind of experience they was expecting from Wix. The result was that overall, it kind of hurt our branding and the customer experience. By having a brand on it and a lot of the functionality not available, it created the impression that the product is lacking.
The result was that we said, "Okay, we might leave a tiny bit of the money on the table, but long term, it's very important for our brand." You're seeing both of those things happening, almost at the same time, not exactly at the same time, because the first one actually happened last year. We are very happy with this change. As you can see, the changes actually increase our revenues per cohort, which is why we started to provide a graph that shows the cohort value themselves. We still add almost 2.5 million free users every month, and still nearly about 6 million users this quarter. We feel that we address 95% or 97% of the market now.
However, I think we do it with a much better product, and the result is that the future will be the branding effect of that for our customers and the customer satisfaction is much higher.
Just a quick follow-up on Corvid, you mentioned excitement. When you think about kind of exiting late-stage beta to fully general availability, are you still targeting the back half of this year?
Pardon me, ladies and gentlemen. It appears we have lost our connection to our speaker line. Please stand by while we reconnect. Pardon me, this is the operator. Thank you for your patience. We have reconnected with the speakers, and we'll continue the conference. Brent, you may begin your question.
Thanks for having us back. Just on Corvid, I know you mentioned recently you were late-stage beta. Are you still on track in the second half for GA and Corvid?
Sorry, I missed the first part of the question.
Just as it relates to Corvid, I think you mentioned that you were in late-stage beta. Are you still on track for the second half of the year to go generally available on Corvid?
I think so. I do believe so. I think that the product is actually, as you can see from the results, right? 1 million users and about 200,000 professionals are really heavily engaged with the product. I think we are in a very good place. It is a super sophisticated product. We expected beta and testing to be very, very complex, and we're happy to see that we're actually launching a bit ahead of what we expected. In Tokyo, that's clearly happening.
Great. Thanks.
Great. Thanks for your question, Brent, and we apologize again for the interruption here. Can we have the next question, please?
The next question comes from Naved Khan with SunTrust. Please go ahead.
Hi. Thanks a lot. I had a question on the expanded customer support. Seems like it's off to a good start. What kind of contribution should we be assuming from this effort this year? I think for next year, you already talked about around 500 basis points or so. How should we think about 2019?
Hey, Naved, it's Nir. I'll let Lior jump into the contribution answer in a second. I just want to say that generally, I think operationally, we are very happy with the progress here. We've reached the current headcount that we were interested in, and we also already see great results, simply by the fact that we now manage to deliver 24/7, follow the sun customer service, which is something that we always wanted to do, and it took us a while to get there. We also really seeing amazing results in terms of the SLA, of how fast a call goes back to a customer, which is now a matter of seconds. In that aspect, we are very happy. Parallel to that, we are expanding our testing around the more innovative, personalized customer service that we believe can have a great impact going into next year.
I'll let Lior talk more about the contribution.
Yes. Since we are still in our testing mode and try to understand what will be the best monetization for us to use there. I didn't take it into consideration into this year guidance. Obviously, if that happen, it would be a great upside. Certainly, we are still in line with what we provided for next year.
Thank you.
Thanks, Naved. Can we have the next question, please?
The next question comes from Ron Josey with JMP Securities. Please go ahead.
Great. Thanks for taking the question. I want to ask about two questions, please. I want to ask about pricing first. We see the strength in the U.S. ACPS with the 29% growth this quarter. With the U.S. accounting for about 50-plus% of the business and post all the pricing changes, I just wanted to understand when we might start seeing average quarterly collections per subscriber, see that flow through. We saw that maybe a little bit in 2Q. Just wanted to get your thoughts on overall pricing increase, how we see that flow through the model for the rest of the year and into 2020. On sales and marketing, it continues to be a source of leverage here.
Just wondering if your philosophy around sales and marketing is changing given the rise of Corvid, the focus on more, call it S and M businesses, if you will, versus micro businesses, and the launch of 24 by seven support. Just wondering if there are new avenues or partnerships that you might explore, given you have all these new products. You also mentioned higher quality users. One on pricing and two on just sales and marketing philosophy. Thank you.
Hey, Ron, this is Lior. First of all, regard to pricing and the average ARPU based on revenue. The 29%, it's great results. I think that it just emphasize, that this evolution and the changes that we've made with the pricing are actually working. Remember that when you calculate the ARPU based on revenue, you have two impact, which you need to take into account. The 29% is calculated on users and newcomers, while the ARPU is based on revenue, but also about all the historical cohorts and users that we have. It will take a while until you actually see the impact of it, meaning that every quarter you will see improvement in the ARPU. I assume that it will actually continue for several years.
The fact is that you have all of the historical users there, but it will continue to increase slowly but steadily.
Hey, Ron, it's Nir. I'll take the second part of your question about the sales and marketing. I think, generally, when you think about our marketing and our strategy, I would say it has not changed. If you remember, on our last analyst day about a year ago, Omer, our CMO, spoke about his goal to become one of the top 100 brands on the globe. We definitely think that we have a shot at the title, so to speak. I think that in that aspect, we are not changing the philosophy. We are exploring more avenues all the time, testing and experimenting with other sources of traffic, some of which can be more relevant for more professional crowds. That's definitely something that we're interested to understand.
I would say that the one area where we're doing it, maybe a little bit of a different than the regular ROI perspective is our investment into the partners initiative, the one that we spoke about, and we explained the investment as well as the buildup of the team in N.Y. There, obviously, we want to find the best way to work with these people in order to deliver value to them so they can deliver value for their own customers. That's definitely something that we are strong believers is going to keep on expanding and have an impact on how we do sales and marketing, it's not going to change the core philosophy. It's going to be an add-on to it.
Thanks, Nir. Any recent updates around the partnerships or anything around there would be helpful. Thank you very much.
I think we covered most of it in what we spoke about before. We have tens of thousands of partners already using Wix. I think that a large part of the success we're having there, and it's very clear to us now that we are doing a much better job at talking to them and understanding their needs and helping them achieve success, is obviously Corvid. Clearly, I think that without Corvid, if you would try to do the same thing two years ago, we would be very limited in our ability to really help these guys be successful. I think that's, in large part, why we're so excited about Corvid, because it helps us expand our TAM significantly.
Great. Thanks, Ron.
Thank you.
Can we have the next question, please?
The next question comes from Jason Helfstein with Oppenheimer. Please go ahead.
Hey, guys. How are you? I'm going to ask two questions. Now that you're targeting agencies with the 70-person team, how should we think about CAC to LTV for those clients? Just given that, I would imagine it's a different calculation versus your typical SMB, the way you've historically measured marketing. I think one of the things that's notable is marketing, I think, came in meaningfully less than I think the Street was expecting in the quarter. Maybe just talk about that and how it ties to marketing. If you can give us some more color on gross adds versus churn for SMB following the price increase. I know you don't want to give specifics, but did you see greater movement in one versus the other, meaning gross adds versus churn in the quarter? Thanks.
Hey, Jason. Nir here. I'll start with the first question, and then I'll hand it over to Lior for the second part. I would say that in terms, at least currently, in terms of these partners, with over 2 million registered users a month, at this point at least, we don't really need to go after them. They come to us, and it's more about our ability to recognize them and understand their needs and then help them down the line to become very successful. I would assume that over time, as we learn and we improve on it, then we'll monitor the data, we'll be able to have a better calculation of their additional value that they bring to the course, which is obviously much higher than the regular DIY user that we absorb in.
Actually on the side of the CAC, it's probably not really changing, at least not at this stage. The value is going to be tremendously higher. Lior, you want to take a second?
Yeah. With regard to the growth in churn, Jason Helfstein, you know that we provide this information based on the cohort, and we also recently introduced the new KPI. You're talking about the cohort value, and obviously, we see that it increased. I want to emphasize something that I'm happy that you asked it, because as part of the evolution, we said that we changed the prices, we increased prices. It was, in a way, on the account of some customers, but most of them, obviously, are low-intent customers with the lower price packages that used to be previously. I do expect, obviously, that those customers traditionally came with a higher churn. Obviously, I expect medium and long term that we are going to see improvements over there.
We actually already started to see that, but I think that it will be more significant in the future. That was also part of the reason why we see increase in the lifetime value of our cohorts.
Just why marketing was lower, maybe, than people expected, or?
No. Marketing this quarter, by the way, in a way, it was a similar pattern to last year's. Q1 was significantly better than, or stronger. Usually this is what happen. it's the seasonality, that Q1 is a very strong quarter. If you compare Q2 to Q1, obviously, there are differences. Nothing happened beside of that. You can see it, by the way, by the number of users that we managed to bring in. We are according to the same KPI with the same TLY. Nothing changed there.
Great. Thanks, Jason. Can we have the next question, please?
The next question comes from Ygal Arounian with Wedbush Securities. Please go ahead.
Hey, guys. Thanks for taking the question. On the agency partners, you've noted having tens of thousands of agency partners. I think you've noted agency partners in the thousands previously as well. Can you help us understand how the pace of the ads has changed since you started the marketing effort, rolled out Corvid, kind of stepped into this a little bit more? Is there any way to parse out how much it contributed this quarter, how much you're expecting it to contribute next year, and the key KPIs for investors to look for? Ostensibly, if agencies are driving multiple subs per agency and they're coming in with higher intent, that should translate to better conversion, again, over time and an acceleration of sub growth. Is that the right way to think about it?
Real quickly on pricing, I just want to be clear, was this a planned two-part price increase rollout? What did you see that.
Made you confident to raise prices again. How do you think about raising prices again in the future? What's the right way to think about that? Thanks.
Yeah. I will start with the first question about the agencies. We don't provide information about how many agencies and what is the addition, but obviously, we've added many new agencies, and we already start to see the contribution. Bear in mind that, and this is traditionally what happened with our business, most of the impact you actually can see in the following years because even if you add an agency, we'll build a few thousands of premiums. It's a small amount compared to the overall premiums that we have, and therefore, you don't see much of an impact in the short term. Based on the first results, based on the initial results, and based on the discussions in the engaged discussion that we have with those guys, I do expect it to be significantly higher in the next coming years.
We are very optimistic about it. With regard to the second question was about the price increase. Right now, look, at any point of time, there is a test about price, about features, and we always take decision based on those results. It's hard for me right now to commit if we'll not or if we will or not, but bear in mind that the last price increase was the most optimized one that we actually tested. I don't anticipate any more significant price increase in the near future. Again, it's hard to commit for the longer term because it really depends on the offering. It's based on the test that we are doing or we will do in the future. Again, for the short term, for this coming year, I don't anticipate any more significant price increase.
Great. Thanks, Ygal. Can we have the next question, please?
The next question comes from Nat Schindler with Bank of America Merrill Lynch. Please go ahead.
Yes. Hi, guys. Just a quick question. For the last several years, you have been growing fairly consistently fastest in the U.S., your most penetrated market. Are there any particular dynamics of the U.S. that make it more amenable to your services and make it harder to approach, and are there things about, let's say, Europe, a similar-sized market and similar economics that make it difficult to penetrate? Additionally, with Asia, which has also not been able to hold its own versus the U.S., do you expect to see any significant change in how your geographic distribution is going to look as you've opened offices in Japan?
This is Avishai. I think that a lot of the reason that we've been growing in actually it's the English-speaking countries, right? I think that's the best definition, is because we had more resources dedicated to that. There's no real reason why we cannot extend to other countries. Obviously, the growth of economy and the size of small businesses, medium-sized businesses, and tiny businesses, startup data company is a huge contributor to our success in growing there. The thing that we're doing in Japan is an example that we believe that by focusing more, we can get much better results. We've shown that in the past by, for example, in South America. I think that this would be an incredible test. We already do see very similar results in quality in the Asia countries that we've been addressing.
Hopefully, it will be as good as the U.S. or even better. Most of it is about focus, dedicated resources, getting the right payment gateway, getting the right translated help, agents that speak that language. Just opened a Dublin office so we can get more people in the European that would be able to work in the European languages and supporting and translating content for our users. This is pretty much a focus that we are more focused this year on that than ever before.
Thank you, Nat. Can we have the next question, please?
The next question comes from Lloyd Walmsley with Deutsche Bank. Please go ahead.
Thanks. I'm wondering, on the payment side, you're now in 12 countries. Can you give us a sense for just something like attach rate on new subscriptions or what kind of market share you're getting on payments for sites that are building in some sort of payments functionality or what kind of volume you're processing? Anything to give us a sense for how this is launching, and then how to think about 2020. Just a follow-up on Corvid. Can you give us any more clarity on the revenue model and how you guys, as it moves out of beta, how you guys are going to be charging for it next year?
Hey, Lloyd, it's Nir. I'll take the first part about payments. We don't want to start breaking out numbers here, but I can share that in terms of the attach rate, if you look at our new users that need some form of payments to some kind of activity, whether it's stores or bookings or restaurants or anything, the vast majority are choosing Wix Payments, which we think is great and encouraging. Our goal is to both bring that number up as well as keep on expanding into more territories as time progresses. We're not at the stage of breaking out volume and GMV. It's too early. I have to say that GMV grows with the combination of adoption as well as the growth of the businesses themselves.
Obviously, our goal is to both expand this product while talking to our users, understanding their needs, and helping them solve issues and problems in order for them to be more successful and obviously contribute even more through the GMV to the Wix business.
In regards to Corvid, I think that Corvidization, from our perspective, builds into two parts. The first part, as we said in the analyst day, is the ability for us to extend our TAM beyond just do-it-yourself, also to more of professionals and partners. This is a market that is probably 10x the market that we've been addressing in the past, and where revenues are also higher per sub. We can see that Corvid is doing that for us now. With Corvid, we're able to do all the initiatives we're doing with the bigger partners that we are now starting to accumulate. I think that just by itself is a fantastic value that we get out of it, and it's happening.
The other side of it is that we do believe that Corvid, in essence, can also provide much more advanced packages that we can sell and much more expensive subscriptions. We believe that we'll be ready at some point next year to do that. We also believe that it'll be mostly based on functionality and not on any item at all. That will mean that there will be some additional function that will be available for somebody who is getting the higher-paid packages. That is currently our plan. At this stage, I got to say, I'm really feeling happy about what we already do get from Corvid today, which is really the ability to go after developers and much more sophisticated partners.
Thanks, Lloyd. Can we have the next question, please?
The next question comes from Sterling Auty with JP Morgan. Please go ahead.
Yeah, thanks. Hi, guys. On the customer support personnel, I think there was a description that the total headcount does not include the third-party companies that you're using for customer support. Can you just give us a sense how many of those customer support personnel are going to be on the Wix payroll versus hiring third-party indirect customer support people?
Yeah, right now the model is to go through our indirect. I'm talking only about the addition. It doesn't take into account, obviously, some of the support that we are establishing in Japan that would be direct, or in Dublin is also direct. Most of the additions, and we said that it's kind of low price areas, and this one goes through a third party, and we already have engaged with a few hundreds. We didn't expose the right amount of people, but basically, we're talking about hundreds that already started to work for Wix through our third party.
All right, great. One follow-up just on CapEx. It popped up a few million this quarter. Is that just the Japan office or is there something increasing in terms of your investment to support Corvid or something else?
Actually, it's not Japan. It's actually some of the expansions that we did to our New York office specifically and Dublin. That was something that we took into consideration. Obviously, every time that we expand the business and we establish a new operation, so it's mostly about that. I do believe that in the second half, we are going to meet the overall guidance that we provided, but that was the main reason for that.
Thank you.
Great. Thanks, Sterling. Can we have the next question, please?
The next question comes from Mark Grant with Goldman Sachs. Please go ahead.
Thanks. As we try and profile these agencies that are coming in, as you keep bringing more and more on board through Corvid, I think we all appreciate the Agency MJ example that you gave, which was very helpful. Can you give us a sense, is that agency indicative of the new agencies that are coming on board now, or was that one that's been a paying subscriber for some time? Additionally, can you give us a sense of what the annual contribution to collections is, whether from Agency MJ specifically or an agency like it?
I can answer the first part, and Lior can take the second part, but I think that this is kind of an average case. It's not the largest or one of the largest, and it's definitely not the smallest. That's why we provided it. I would say it's somewhere in the median, the amount of websites that agencies can have. Obviously, the value of that is you multiply the active subscriptions by the amount of pretty much average ARPU on Wix. I think that's what you're going to get in terms of the contribution from one of those agencies. The biggest value of those agencies is that if in the past we would do marketing and acquire one user, and that user will do one or two subscriptions, on average, 1.4, if I remember. This time we have something different.
We do marketing, we get an agency, they do one, then they do another, then they do another, then they do another. The customers that the agency have tend to be one that will consume the more expensive products on Wix. A lot of it is just because there's somebody to guide them on how to use those products. We're seeing things like Ascend being used more often. Of course, the support from our side is lower. Long term, and as Lior mentioned before, we're a subscription company, so those things tend to accumulate over time. It's not starting with a higher value. Long term, I think it will have a significant contribution to our efficiency as a company and to our customer satisfaction.
Yeah, we don't break down the collection between agencies and other customers. It might make sense to do it in the future, but not right now. I cannot provide any information about it.
Okay. Appreciate the color. Thank you.
Great. Thank you. Can we have the next question, please?
The next question comes from Ken Wong with Guggenheim Securities. Please go ahead.
Great. Thanks for taking my question, guys. When we think about improved monetization this quarter, can you help rank the drivers of ARPU across the price increase, attach, and mix? As we look ahead, does this dynamic change?
Sure. In the last few quarters, most of the impacts, I'm talking about the ACPS, the average collection in the U.S., because this is more relevant to the price increase. Obviously, in the last few quarters, the price increase was one of the main reasons. This quarter, we started to see also increase coming from adoption of new products that we've launched, like Wix Payments, like Ascend and so on. I certainly expect to see a continuation of this increase, but that will be mainly from adoption of new products. Does it make sense?
Got it. Great. Thanks a lot, guys.
Okay.
Thanks, Ken. Can we have the next question, please?
The next question comes from Matthew Pfau with William Blair. Please go ahead.
Hey, guys. Thanks for taking my questions. Wanted to ask a follow-up on ARPU. The 29% increase in average collections per new U.S. subscription, how would that compare to the rest of the world? Is there anything such as pricing that's having an outsized impact in the U.S. relative to your other geographies?
Obviously, most of the price changes that we've made was actually in the U.S. Naturally, there is price differences because of what happened to the currency in the last three years. There is quite a big change. By the way, you can see that by some of it, by comparing the average or the ARPU based on revenue that you see in the graph, meaning the $171 compared to the $228. The $171 take into account all the regions, not just the U.S., but also it doesn't reflect the last price changes because it's based on revenue. Again, as I mentioned before, we will always in every point of time, we do some kind of testing also outside of the U.S., but you can imagine that what fits for one country doesn't make sense to another country.
What we are trying to do, obviously, is try to optimize the pricing for each and every one of the countries that we are working.
Great. Thanks, guys.
Thank you, Matt. Thanks, Matt. I think we have time for just one more question.
Our last question comes from Nick Jones with Citi. Please go ahead.
Hi. Thanks for taking the question. Just one on the relationship with agencies today. How are agencies using Wix? It seems like there's a lot of focus on corporate, but there might be a use case to maybe use some of the easier-to-use products on Wix. If the agency's focus is just to get a site up quickly and then maybe deploy Wix's SEO. Is there any color you can give on how agencies are using the platform today? Is it really Corvid-focused, or is it more of a kind of holistic platform to maybe replace some of the tech they're using?
Thank you for the question. Obviously, as you said, not all the projects are using Corvid, right? Those will be only for the most sophisticated projects. When an agency approaches us, right, and they want to validate if they can do most of their project with Wix, Corvid becomes very important. I would estimate, and this is my estimation from talking and not the statistic that we did, that probably about 25% of the projects they're doing actually use Corvid, 75% would probably not. The thing is that most agencies prefer to work with one platform, obviously, so one training set for the customers. We provide a lot of benefits also for those 75%, like, for example, security. If you have WordPress, you need to work insanely hard in order to maintain the site to be secure. With Wix, this is automatic, right?
That's just one example. You want to be able to change stuff, again, with WordPress, you mostly need a developer. With Wix, any designer can do that. We provide a lot of value there, but if a regular agency was to find that for a lot of their projects, they need to go to a different platform, it's harder for them to pick Wix. Today, with Corvid, we pretty much removed that from the equation because now everything you can do on Wix, and Corvid is actually much easier than the other development platforms. You can do it faster and more stable and more secure now on Wix than on WordPress, Drupal, or any of the other platforms.
I think this is pretty much how they use it, and they will build anything from simple landing page, which, of course, doesn't use Corvid, to super sophisticated portals, which, of course, are mostly based on Corvid.
Thanks.
Great. Thanks, Nick, and thanks, everyone, for joining today. Have a good day.
The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.