Company Overview We are a leading, global platform for creating, managing, and growing a complete digital presence. We empower millions of users including self-creators, agencies, enterprises and more with industry-leading infrastructure, performance, and security, delivering our solutions through a Software-as-a-Service (“SaaS”) model. Our platform combines advanced AI, flexible web design, domains, hosting, templates and robust business and commerce solutions to help users build stronger brands, connect with their audiences, and scale their businesses online. Wix’s vision is to simplify complex technologies and deliver the best tools for every type of user and business to create online. Powered by advanced AI and enterprise-grade infrastructure, Wix is trusted by hundreds of millions of users worldwide. Founded in 2006 and strengthened by the 2025 acquisition of Base44, the no-code application platform, Wix is continuing to build for the future of the internet. 86 Overachievement of Three-Year Financial Plan During our Analyst and Investor Day in August 2023, we presented a three-year financial plan and long-term financial framework (the “Three-Year Plan”) as well as an update on our product strategy, including generative AI plans and our new groundbreaking professional website development platform, Wix Studio. The Three-Year Plan detailed our expectations for achieving profitability targets, specifically increasing free cash flow margins and the path to positive GAAP net income. We have fully achieved our expectations set out in the Three-Year Plan by achieving positive GAAP net income in 2023, two years earlier than anticipated, and notably achieved the “Rule of 40”, a year earlier than anticipated, primarily by outperforming our free cash flow target. In 2025, we continued to benefit from the expansion of our product and service offerings as well as the expansion of our total addressable market. Our total revenue in 2025 was $1.99 billion, an increase of 13% over 2024. Our Creative Subscriptions Revenue was $1.41 billion, which represented an increase of 11% from 2024. Our Business Solutions Revenue was $583.3 million in 2025, which represented an increase of 18% from 2024. See “How We Generate Revenues” below. Our Creative Subscriptions Revenue represented 71% of our total revenue in 2025, and our Business Solutions Revenue represented 29% of our total revenue in 2025. Our future growth will depend, in part, on our ability to generate new premium subscriptions, retain existing premium subscriptions, increase the adoption of our business solutions, and increase the revenue we generate from existing and new premium subscriptions, including from partners. It will also depend, in part, on our continued ability to manage our infrastructure effectively and adapt to changes to technologies used in our solutions, such as the use of AI Technologies. Strong top-line growth coupled with a diligent operating cost base enabled us to generate nearly $600 million of free cash flow in 2025, meaningfully above the ~$500 million target set in our Three-Year Plan. How We Generate Revenues Our total revenues are comprised of Creative Subscriptions Revenues and Business Solutions Revenues. Creative Subscriptions Revenue We generate Creative Subscriptions Revenue from the sale of monthly, yearly and multi-year premium subscriptions for our website and application solutions, including vertical solutions when purchased in a bundled subscription, from the sale of domain name registrations and other minor creative product subscriptions we offer, as well as through our Base44 offering. Our website and application solutions are offered through a freemium model in which users can register with an e-mail address and build, launch and manage a digital presence for free, for an unlimited amount of time. Premium subscription plans are offered for various periods, such as monthly, yearly, or multi-yearly, and at various price points depending on functionality and capabilities. Users can also purchase a domain name registration from us, as an ICANN accredited domain registrar, or in our capacity as a domain reseller of third-party registration services. For those users who purchase a premium package, a voucher is provided that may be redeemed for a new domain registration free of charge for the first year of subscription. The domain can be registered under yearly or multi-year periods. We also allow our users to connect existing domains purchased from external providers to sites upgraded to one of the multiple premium plans we offer. Yearly and multi-year subscriptions provide benefits to our operating model because we are able to collect cash up front, increase overall retention rates and have greater visibility into revenues. We provide incentives to drive yearly and multi-year subscriptions, including a lower average monthly price relative to a monthly subscription. As of December 31, 2025, 83% of our overall premium subscriptions were yearly or multi-year subscriptions and 17% were monthly subscriptions. To increase Creative Subscriptions Revenue, we focus on growing our registered user base by providing our registered users with a high-quality user experience and more products and solutions, including AI-enabled capabilities, so that they become more engaged on our platform, can create and complete the project they desire, and are therefore more inclined to purchase a premium subscription. We provide different pricing plans based on the needs of our users who are looking to purchase a premium subscription. In addition, we also focus on attracting new partners and maintaining our current partners, who use our platform to service their customers, by providing them with products and solutions suitable for their needs, including high quality 87 products, such as our website development platform for professionals, Wix Studio, personal account management services, and the ability to benefit from revenue sharing programs with us under specified conditions. We further focus on increasing the amount of revenue per subscription by adding features and functionality to our offerings for which we can charge higher prices, and by optimizing packaging and pricing by geographic region. Business Solutions Revenue We generate Business Solutions Revenue from the sale of various products and services that we offer to help users and partners manage and grow their business online, on top of their Creative Subscriptions. These products and services include, among others, applications that are developed by us and by third parties and sold both through our App Market or elsewhere on our platform. Applications include Google Workspace, which is our most frequently sold application. Other components of Business Solutions Revenue include the sale of payments services through Payments by Wix, Paid Ad Campaigns, Email marketing, Wix POS, Wix Logo Maker, DeviantArt (our wholly-owned subsidiary), and other products. We increase Business Solutions Revenue by offering additional business solutions to our users and partners to manage and grow their business online and be more successful. We believe the more products and services we can provide our users and partners, the more successful they can be online, driving higher retention and loyalty, and in turn our revenue. The combination of growing our registered user base, growing and retaining our premium subscription user base and increasing the revenue we generate per premium subscription are all key factors to our success. User Acquisition Investment Our user acquisition strategy is based on the significant amounts of data that we have accumulated regarding the behavior of users that we acquire from different sources and the amount of bookings and revenue we generate through the sale of creative subscriptions and business solutions. We extrapolate from this historical user behavior data to predict future user behavior and make investment decisions regarding our marketing expenditures. In order to grow our registered user base and, in turn, our creative subscriptions and increase our revenue and bookings per premium subscription, we consider the time period over which we seek to return an amount of bookings equal to the marketing expenditures used to attract a specific group of registered users, which we refer to as a cohort, during a particular period. In order to achieve the targeted time for return on those marketing investments, we adjust the paid marketing channels that we use and the amounts that we pay to acquire new registered users in addition to considering those registered users that come from organic and direct sources. For example, we could pay a substantially identical amount to acquire fewer registered users that generate creative subscriptions at a higher rate, or that generate creative subscriptions at a lower rate but with a higher revenue or bookings per subscription, versus acquiring more registered users that generate creative subscriptions at a lower rate or with lower revenue or bookings per subscription. In addition to our online and offline marketing activities to acquire new users, we also acquire new users by engaging with partners that use our platform for their own work and as resellers for their clients. We accomplish this outreach with our sales and account management teams, as well as through marketing content, online communities and organized events and conferences. To track our growth, progress and execution of marketing efforts, including achievement of our targeted time for return on marketing investment, we regularly review the relationship between origination of our registered users, origination of our creative subscriptions and the amount of revenue and bookings we generate from these creative subscriptions. A. Operating Results The information contained in this section should be read in conjunction with our consolidated financial statements for the year ended December 31, 2025 and related notes and the information contained elsewhere in this annual report. Our financial statements have been prepared in accordance with U.S. GAAP. For a discussion of our results of operations for the year ended December 31, 2024, including a year-to-year comparison between 2024 and 2023, refer to Item 5. “Operating and Financial 88 Review and Prospects” in our Annual Report on Form 20-F for the year ended December 31, 2024, filed with the SEC on March 21, 2025. 89 Components of Statements of Operations Revenues Sources of Revenues and Revenue Recognition Our total revenues are comprised of revenues we generate from Creative Subscriptions and revenues we generate from Business Solutions. Creative Subscriptions Revenue We generate Creative Subscriptions Revenue from the sale of monthly, yearly and multi-year premium subscriptions for our website and application solutions. Revenues from premium subscriptions are recognized ratably over the term of the service period. We offer new Wix premium subscription packages with a 14-day refund period during which the registered user can cancel the subscription and receive a full refund. We classify such amounts collected from new subscriptions as customer deposits until the end of the 14-day refund period. After the 14-day refund period has ended, we recognize premium subscription revenues ratably over the term of the service period, either monthly, annually or longer. We also derive our Creative Subscriptions Revenue from selling domain name registrations. Revenues from domain name registrations accounted for approximately 5% of total revenues in both 2025 and 2024. We recognize revenues from domain registration sales at a point of time upon collection. We do not offer trial periods for domain name registrations, unless required by applicable laws. Business Solutions Revenue We generate Business Solutions Revenue from the sale of various products and services that we offer to help users manage and grow their business online. These products and services include, among others, applications, both sold through our App Market or elsewhere on our platform, Google Workspace, Payments by Wix, Paid Ad Campaigns, and Email marketing. Our Business Solutions Revenue in 2025 includes revenue that was generated by Payments by Wix. Revenues related to our Wix Payments product earned from processing payments are recognized at the time of the transaction, and fees are determined based in part on a percentage of the Gross Payment Volume (“GPV”) processed plus a per transaction fee, where applicable. When payment methods other than Wix Payments are used, we may also generate revenues from revenue - share arrangements which we have in place, based on the GPV. We recognize revenues generated from Payments by Wix upon collection, the majority of which we recognize on a gross basis. In addition, our Business Solutions Revenue in 2025 includes revenue that was generated through the sale of applications. Google Workspace, which we sell as an integrated solution and which allows our users to create a personalized Gmail email address using their Wix-connected domain name alongside additional functionalities, comprised the majority of application sales in 2025. Google Workspace subscriptions are sold on a monthly or yearly basis, and we recognize revenue ratably over the subscription period, on a gross basis. Applications revenue is also generated by applications sold through our App Market by third-party developers for which we receive a portion of the sales price paid by our registered users. For applications developed by third-party application developers, we typically account for revenues on a net basis by recognizing only the commission we retain from each sale. We also generate applications revenue from the sale of self-developed applications, and this revenue is recognized mainly over the service period. 90 Geographic Breakdown of Revenues The following table sets forth the geographic breakdown of revenues for the periods indicated: Year Ended December 31, 2025 2024 North America 60% 60% Europe 25% 25% Latin America 4% 4% Asia and Others 11% 11% Total 100% 100% The percentage of revenue that is derived from each geographic region is partly based on the amount of marketing investment we choose to make in specific countries. Revenue generated by geographic region is also influenced by fluctuations in foreign currency exchange rates. Adoption of our solutions and services in geographic regions outside of North America is driven by our ability to offer our platform in local languages and offer local billing solutions. When introducing our products to new markets, we first focus on establishing an operational online billing system, if needed, prior to launching and investing in local marketing activities. We currently offer our platform in 22 languages: English, French, Spanish, Portuguese, Italian, Russian, German, Japanese, Korean, Polish, Dutch, Turkish, Norwegian, Swedish, Danish, Czech, Traditional Chinese, Ukrainian, Thai, Vietnamese, Hindi, and Indonesian. Costs and Expenses Cost of Creative Subscriptions Revenue Cost of Creative Subscriptions Revenue consists primarily of the allocation of costs associated with the provision of website and application creation and services, namely, hosting costs for our platform, related Customer Care costs along with domain name registration costs. Cost of Creative Subscriptions Revenue also consists of personnel and the related overhead costs, including share-based compensation. Our Cost of Creative Subscription revenue increased during 2025, mainly due to hosting and revenue related costs (including AI costs). We expect our cost of Creative Subscriptions Revenue to increase in 2026 due to the increase in the number of registered users, both for Wix and Base44 as well as increased sales of domain registrations and the respective hosting, AI, and Customer Care costs to support the growth. Cost of Business Solutions Revenue Cost of Business Solutions Revenue consists primarily of the allocation of hosting and support costs associated with the provision of the components that comprise Business Solutions Revenue. Cost of Business Solutions Revenue also consists of revenue share payments according to our agreements with third-party providers, including Google for the Google Workspace application. It also includes costs that we incur when transactions are processed through Payments by Wix, such as credit card interchange and network fees (charged by credit card providers such as Visa, MasterCard and American Express) as well as third-party processing fees and additional services. We expect our cost of Business Solutions Revenue to increase as more users purchase these products and services and as a larger volume of payments are transacted through Payments by Wix. Research and Development Research and development expenses consist primarily of personnel, overhead costs, and share-based compensation, related to our solutions and service development activities including new initiatives, quality assurance and other related development activities. We expect research and development costs as a percentage of revenues to increase, mainly due to earn out payments related to the Base44 acquisition, however, we expect that they will continue to increase on an absolute basis as we develop new solutions and add functionalities to our existing solutions and services and expand our offerings, including solutions that incorporate AI Technologies. 91 Selling and Marketing Our primary operating expense is selling and marketing. A significant component of our selling and marketing expenses are user acquisition costs, which consist primarily of fees paid to third parties for our cost-per-click advertising, social networking and marketing campaigns and other media advertisements. We intend to continue our user acquisition efforts to drive revenue growth while focusing on our return-on-investment targets. In addition, we direct a portion of our marketing expenses towards a more traditional advertising activity. Other selling and marketing expenses also consist primarily of data scientists and data engineering, marketing personnel, including personnel who engage with our partners, and the related overhead costs, including share-based compensation. Our marketing expenses also include billing costs in connection with the processing fee of our bookings. General and Administrative General and administrative expenses primarily consist of personnel and overhead related costs, including share-based compensation, for our executive, finance, legal, human resources and administrative personnel. General and administrative expenses also include acquisition related expenses, legal, accounting and other professional service fees, and other corporate expenses. We also incur costs associated with being a public company in the United States, including compliance under the Sarbanes-Oxley Act of 2002 and rules promulgated by the SEC and NASDAQ, and director and officer liability insurance. Financial Income (Expenses), Net Financial income (expenses), net consists of interest income from investments in marketable securities and deposits as well as income from the changes in the valuation of our holdings in public and private companies. Financial income (expenses), net also includes amortization of convertible debt issuance costs and costs related to derivative instruments we enter into for foreign exchange transactions to hedge a portion of our payments in NIS and revenue transactions denominated in Euros, British pounds and other currencies, as well as income and expenses related to the change in the fair value of such derivative instruments. In addition, financial income (expenses), net includes the fluctuation in value due to foreign exchange differences between our monetary assets and liabilities denominated in NIS and other non-USD currencies. Income Tax Benefit (Expense) Income tax benefit (expense) consists of current taxes, including those related to our international activities, and deferred taxes arising from temporary differences between the accounting and tax bases of assets and liabilities. In 2025, we generated taxable income in Israel, and given that at the end of 2025 we fully utilized our net operating loss carryforwards for Israeli tax purposes, we are eligible for certain tax benefits in Israel under the Law for the Encouragement of Capital Investments, 1959, or the Investment Law. Accordingly, our preferred technological taxable income in Israel, should be subject to tax at the rate of 12%. We expect to be eligible for tax benefits as a Preferred Technological Enterprise. For more information regarding the tax benefits available to us, see Item 10.E. “Additional Information—Taxation.” Our taxable income generated outside of Israel or derived from other sources in Israel will be subject to the regular corporate tax rate. 92 Comparison of Period to Period Results of Operations The following table sets forth our results of operations in dollars and as a percentage of revenues for the periods indicated: Year Ended December 31, 2025 2024 Amount % of Revenues Amount % of Revenues (In USD thousands) Revenues Creative Subscriptions 1,409,727 70.7 % 1,264,975 71.8 % Business Solutions 583,317 29.3 % 495,675 28.2 % Total 1,993,044 100.0 % 1,760,650 100.0 % Cost of revenues Creative Subscriptions 237,288 11.9 % 213,422 12.1 % Business Solutions 399,065 20.0 % 351,213 19.9 % Total 636,353 31.9 % 564,635 32.1 % Gross profit 1,356,691 68.1 % 1,196,015 67.9 % Operating expenses: Research and development 645,501 32.4 % 495,281 28.1 % Selling and marketing 514,280 25.8 % 425,457 24.2 % General and administrative 195,158 9.8 % 175,136 9.9 % Total operating expenses 1,354,939 68.0 % 1,095,874 62.2 % Operating income 1,752 0.1 % 100,141 5.7 % Financial income (expense), net (5,015) (0.3) % 51,820 2.9 % Other income (expenses) 4,352 0.2 % (36) — % Income before taxes on income 1,089 0.1 % 151,925 8.6 % Income tax benefit (expense) 51,047 2.6 % (13,603) (0.8) % Loss from equity method investment (1,490) (0.1) % — — % Net income 50,646 2.5 % 138,322 7.9 % Year Ended 2025 Compared to Year Ended 2024 Revenue and Bookings Revenue increased by $232 million, or 13%, from $1.76 billion in 2024 to $1.99 billion in 2025. Revenue growth this year was driven in part by solid performance in our Creative Subscriptions business as Creative Subscriptions ARR increased 13% year over year to $1.52 billion at the end of 2025, and Business Solutions ARR increased 18% year over year to $312.4 million at the end of 2025. This increase was also driven by an increase in average revenue per premium subscriptions (“ARPS”) and the increasing availability of our new products and solutions. ARPS growth was driven by the onboarding and retention of high quality users that purchase higher priced packages, better adopt Business Solutions, and drive compounding GPV as well as the price increase implemented in early 2024, partially offset by macroeconomic pressure on small to mid-sized business users, which were headwinds to GPV growth during 2025. Our Creative Subscriptions Revenue was $1.41 billion in 2025, which represented an increase of 11% from 2024. Our Business Solutions Revenue was $583.3 million in 2025, which represented an increase of 18% from 2024. Bookings increased by 13%, from $1.83 billion in 2024 to $2.07 billion in 2025, primarily driven by an increase in average bookings per premium subscription. Our Creative Subscriptions Bookings were $1.48 billion in 2025, which represented a 12% increase from 2024. Our Business Solutions Bookings were $593.4 million in 2025, which represented 15% growth over 2024. 93 Costs and Expenses Cost of Creative Subscriptions Revenue Cost of Creative Subscriptions Revenue increased by $23.9 million, or 11%, from $213.4 million in 2024 to $237.3 million in 2025. This increase was primarily attributable to an increase of $13.9 million in revenue-related costs, $6.4 million increase in hosting costs, $4.5 million in domain cost, $1.6 million in amortization costs and $0.2 million in acquisition-related costs. This increase was partially offset by a decrease of $2.6 million in payroll expenses, consisting of $2 million decrease due to lower average headcount throughout 2025, and a $0.6 million decrease in share-based compensation expenses, and an additional decrease of $0.2 million related to allocated overhead expenses and other costs. Cost of Business Solutions Revenue Cost of Business Solutions Revenue increased by $47.9 million, or 14%, from $351.2 million in 2024 to $399.1 million in 2025. This increase was primarily attributable to an increase of $47.3 million in revenue-related costs, $2 million in hosting costs and $0.2 million in amortization costs. This increase was partially offset by a decrease of $0.8 million in payroll expense consisting of $1.1 million decrease due to lower average headcount throughout 2025 and $0.3 million increase in share-based compensation expenses, and a decrease of $0.9 million related to allocated overhead expenses and other costs due to reduced activities. Research and Development Research and development expenses increased by $150.2 million, or 30%, from $495.3 million in 2024 to $645.5 million in 2025. This increase was primarily attributable to an increase of $113.8 million in acquisition-related expenses mainly attributed to our acquisition of Base44, $22.4 million in payroll expenses, consisting of $21.4 million due to high average headcount throughout 2025 and a $1 million increase in share-based compensation expenses. Research and development expenses were also affected by an increase of $14.3 million related to allocated overhead expenses and other development costs, offset by a decrease of $0.2 million in hosting costs. Selling and Marketing Selling and marketing expenses increased by $88.8 million, or 21%, from $425.5 million in 2024 to $514.3 million in 2025. The increase was primarily attributable to an increase of $74.1 million in user acquisition costs and other marketing activities mainly due to Base44 marketing expenses, from $175.6 million in 2024 to $243.6 million in 2025. In addition, the increase in selling and marketing expenses was attributable to an increase of $8.7 million related to allocated overhead expenses and other selling and marketing expenses, $4.7 million in processing costs paid to our payments processors, $2.2 million on payroll expenses, consisting of $4 million due to high average headcount throughout 2025 and a $1.8 million decrease in share-based compensation expense, and an increase of $0.3 million in acquisition related expenses. This was partially offset by a decrease of $1.0 million in amortization expenses. General and Administrative General and administrative (“G&A”) expenses increased by $20.0 million, or 11%, from $175.1 million in 2024 to $195.2 million in 2025. This increase was primarily attributable to an increase of $17.3 million in acquisition-related expenses, an increase of $7.2 million related to allocated overhead expenses and other G&A activities. This was partially offset by a decrease of $4.4 million in payroll expenses, consisting of a decrease of $2 million due to lower average headcount and a decrease of $2.4 million in share-based compensation expenses. Financial Income (Expenses), Net Financial expenses, net in 2025 decreased by $56.8 million from financial income, net of $51.8 million in 2024 to financial expenses, net of $5.0 million in 2025. Financial expenses, net in 2025 primarily related to $43.1 million of expenses related to hedging activities, expenses of $8.1 from currency exchange rate differences and bank charges, and expenses of $3.8 million related to the amortization of convertible debt issuance costs. This was partially offset by $48.9 million of income from deposit interest and certain investments and income of $1.1 million from evaluation of our holdings in privately held companies. 94 Financial income, net in 2024 primarily related to $42.0 million of income from deposit interest and certain investments and income of $2.5 million from evaluation of our holdings in a publicly held company, and income of $6.5 million related to hedging activities. In addition we recorded expenses of $3.2 million related to the amortization of convertible debt issuance costs and net income of $4.0 million due to exchange rate differences and bank charges. Income Tax Benefit (Expense) Income tax benefit increased by $64.7 million from expenses of $13.6 million in 2024 to benefit of $51.0 million in 2025. The increase in income tax benefit in 2025 compared to 2024 is primarily attributable to the release of valuation allowance on our deferred tax assets, reflecting our transition to profitability on a cumulative GAAP basis and our expectations of future taxable income. Key Financial and Operating Metrics We monitor the following key operating and financial metrics to evaluate the growth of our business, measure the effectiveness of our marketing efforts, identify trends affecting our business, formulate financial projections and make strategic decisions. Bookings Bookings include cash receipts for creative subscriptions purchased by registered users as well as cash we collect for business solutions, as well as payments due to us under the terms of contractual agreements for which we may have not yet received payment. Bookings is calculated by adding the change in deferred revenues and the change in unbilled contractual obligations we secure from third parties for a particular period to revenues for the same period. Unbilled contractual obligations are commitments of third parties to make certain payments, which are recognized as revenue as we fulfill our obligation under the terms of the contractual agreement. The commitment amount for the upcoming 12 months is recognized as short-term accounts receivable and deferred revenue, and the remaining commitment amount will be recorded in our bookings as unbilled contractual obligations. We believe that bookings is a leading indicator of our revenue growth and the growth of our overall business. Bookings is a non-GAAP financial measure. The following tables reconcile bookings to revenue, the most directly comparable U.S. GAAP measure, for the periods presented: 95 Year Ended December 31, Reconciliation of Revenues to bookings: 2025 2024 (in USD thousands) Revenues $ 1,993,044 $ 1,760,650 Change in deferred revenues 103,895 74,450 Change in unbilled contractual obligations (27,050) (5,048) Bookings $ 2,069,889 $ 1,830,052 Year Ended December 31, Reconciliation of Creative Subscriptions Revenue to bookings: 2025 2024 (in USD thousands) Creative Subscriptions Revenues $ 1,409,727 $ 1,264,975 Change in deferred revenues 93,854 55,518 Change in unbilled contractual obligations (27,050) (5,048) Creative Subscriptions Bookings $ 1,476,531 $ 1,315,445 Year Ended December 31, Reconciliation of Business Solutions Revenue to Bookings: 2025 2024 (in USD thousands) Business Solutions Revenues $ 583,317 $ 495,675 Change in deferred revenues 10,041 18,932 Business Solutions Bookings $ 593,358 $ 514,607 Annualized Recurring Revenue Creative Subscriptions Annualized Recurring Revenue (ARR) is calculated as Creative Subscriptions Monthly Recurring Revenue (MRR) multiplied by 12. Creative Subscriptions MRR is calculated as the total of (i) the total monthly revenue of all Creative Subscriptions (including Base44) in effect on the last day of the period, other than domain registrations; (ii) the average revenue per month from domain registrations multiplied by all registered domains in effect on the last day of the period; and (iii) monthly revenue from other partnership agreements including enterprise partners, in effect in the last month of the period. We believe that ARR is a leading indicator of our anticipated Creative Subscription revenues as it captures both the growth we generate from the number of premium subscriptions as well as the amount of revenue we generate per premium subscription. Our Creative Subscriptions ARR increased to $1.52 billion in 2025 compared to $1.34 billion in 2024, an increase of 13%, driven by a significant increase in our revenue per premium subscription. Business Solutions Annualized Recurring Revenue (ARR) is calculated as Business Solutions Monthly Recurring Revenue (MRR) multiplied by 12. Business Solutions MRR is calculated as the total monthly revenue of Business Solutions subscriptions in effect on the last day of the period. Business Solutions subscriptions include subscriptions such as Google Workspace, Email Marketing, recurring paid ads and more. Including recurring Business Solutions ARR the overall ARR at the end of 2025 was $1.84 billion. Free cash flow We define free cash flow as net cash provided by operating activities less capital expenditures. We believe that free cash flow is useful in evaluating our business because free cash flow reflects the cash surplus available or used to fund the expansion of our business after the payment of capital expenditures relating to the necessary components of ongoing operations. Capital expenditures consist primarily of investments in leasehold improvements for our office space and the purchase of computers and related equipment. Free cash flow is a non-GAAP financial measure. The following tables reconcile free cash flow to net cash provided by operating activities, the most directly comparable U.S. GAAP measure, for the periods presented: 96 Year Ended December 31, 2025 2024 (in USD thousands) Reconciliation of net cash provided by operating activities to free cash flow: Net cash provided by operating activities 582,858 497,415 Capital expenditures (9,901) (19,336) Free cash flow 572,957 478,079 Number of registered users at period end We define this metric as the total number of users, who are registered with Wix.com or Base44 with a unique e-mail address and begin the process of building a website on Wix.com or an application on Base44, at the end of the period. The length of time that users take following registration to design and publish a website varies significantly from hours to years, and many registered users never publish a website. We view the number of registered users at the end of a given period as the strength of our pipeline that can generate premium subscriptions over time and enable us to increase our revenues. Total registered users were 304.2 million at the end of 2025 compared to 282.4 million at the end of 2024, an increase of 8%. These numbers exclude users who use and/or purchase stand-alone products such as Wix Logo Maker and users of DeviantArt or other subsidiaries, until they begin the process of building a website with Wix. Number of premium subscriptions at period end We define this metric as the total monthly, yearly and multi-year premium subscriptions as of the end of the period. A premium subscription can be purchased by a user or by one of our partners for their own use or on behalf of a user. A single registered user can purchase multiple premium subscriptions. We believe that the performance of our Creative Subscriptions segment, which is mostly comprised of revenues generated from the sale and retention of premium subscriptions, is best reflected using the ARR metric that combines both the effect of our premium subscription growth and the growth of our revenues per subscription. Total premium subscriptions were 6.1 million as of December 31, 2025 compared to 6.2 million as of December 31, 2024, a decrease of 1%. Our strategic focus on higher-value users resulted in fewer gross subscription additions. Given our continued transition toward higher long-term value users, we believe total number of premium subscriptions at year end is no longer the best measure to reflect the underlying strength of our business. While we may provide updates at certain points in the future, we will no longer provide our total number of premium subscriptions on a regular basis. B. Liquidity and Capital Resources We have financed our operations primarily through the proceeds from the issuance of our securities and cash flows from operations. In November 2013, we closed our IPO, resulting in net proceeds to us of approximately $93.6 million, and in June and July of 2018, we sold $442.75 million aggregate principal amount of our Convertible Notes due 2023 (the “2023 Convertible Notes”) (which were fully repaid as of July 1, 2023), and in August of 2020, we sold $575.0 million aggregate principal amount of our Convertible Notes due 2025 (the “2025 Convertible Notes”) (which were fully repaid as of August 15, 2025). In September 2025, we sold $1.15 billion aggregate principal amount of 0.00% Convertible Senior Notes due 2030 (the “2030 Convertible Notes”) in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act (all of which were outstanding as of December 31, 2025). As discussed below under “—Recent Developments,” on March 5, 2026, we issued an aggregate of 3,266,699 ordinary shares and Warrants in respect of an additional 816,674 ordinary shares (which are to be settled by net share settlement or cash settlement, at our election, upon exercise) to the Purchasers in the Private Placement for gross proceeds of approximately $260.0 million (upsized from the $250.0 million previously announced), before deducting placement agent fees and offering expenses. Also as discussed below under “—Recent Developments,” on March 3, 2026, we entered into a Credit Facility Agreement, which provides for a revolving facility in an aggregate amount of $500 million to be drawn in up to two draws from April 1, 2026 to March 31, 2027. As of December 31, 2025, we had $311.4 million of cash and cash equivalents, $5.5 million in restricted cash and $385.3 million in short-term deposits with a maturity date of less than one year. In addition, we had $0.2 million as restricted deposits that consisted of restricted bank deposits for 97 our leases and also deposits to secure our online merchant activity with one of our billing processors, and we had $958.1 million in short and long-term investments in marketable securities. A substantial source of our cash provided by operating activities is our cash collections from our premium subscriptions, a portion of which is reflected in our deferred revenues, which is included on our consolidated balance sheet as a liability. Deferred revenues consist primarily of the unrecognized portion of upfront payments from our premium subscriptions as well as domain name registration sales, and certain business solutions. We assess our liquidity, in part, through an analysis of the anticipated recognition of deferred revenues into revenues, together with our other sources of liquidity. As of December 31, 2025, we had positive working capital of $211.4 million, which included $737.3 million of short-term deferred revenues. These deferred revenues remain unrecognized generally for one to 12 months, and will be recognized as revenues ratably over the term of the service period when all of the revenue recognition criteria are met in accordance with our revenue recognition policy. We believe our existing cash and cash equivalents, short-term deposits and marketable securities, and cash from operations will be sufficient to fund our operations and meet our requirements for at least the next 12 months and for the foreseeable future. For more information regarding our Three-Year Plan, see Item 5. “Operating and Financial Review and Process—Company Overview—Three-Year Financial Plan.” Our capital expenditures for fiscal years 2025, 2024 and 2023 amounted to $9.9 million, $19.3 million and $66.0 million, respectively. We expect to spend between approximately $25 million to $30 million in 2026 for capital expenditures. In September 2030, our 2030 Convertible Notes will mature, and, depending on the price of our ordinary shares, we may need to pay the principal amount in cash. As of December 31, 2025, we had $1.15 billion aggregate principal amount of our 2030 Convertible Notes outstanding. For information regarding our convertible notes, including their maturity profile and interest rate structure, see Note 10 of our audited consolidated financial statements included in Item 18 of this annual report. As of December 31, 2025, our future capital and working capital requirements will depend on many factors, including our rate of revenue growth and the timing and extent of our spending on selling and marketing activities and research and development efforts. We will be required to pay corporate income taxes derived from our business activity. We may also seek to invest in or acquire complementary businesses or technologies. To the extent that existing cash and cash equivalents, short-term deposits and marketable securities, cash from operations and net proceeds from the 2030 Convertible Notes are insufficient to fund our future activities, we may need to raise additional funding through debt and/or equity financing. Additional funds may not be available on favorable terms or at all. In addition, our available capital and liquidity will be restricted by our “modified Dutch Auction” tender offer, which is further discussed under “—Recent Developments.” As of December 31, 2025, we had a lease commitment of approximately $415 million over the course of 18 years related to our new headquarters offices in Tel Aviv. We began occupying a portion of our headquarters in October 2022 and took occupancy of the entire headquarters in October 2023. The initial term of the lease agreement is 10 years commencing on the transfer of possession with an option to extend the lease for additional periods of up to 15 years, subject to the conditions of the lease agreement. See the description of the lease agreement in Note 11 of the audited financial statements included in Item 18 of this annual report. We believe our levels of working capital are sufficient for our present requirements. 98 Cash Flows The following table presents the major components of net cash flows for the periods presented: Year Ended December 31, 2025 2024 2023 (in USD thousands) Net cash provided by operating activities 582,858 497,415 248,246 Net cash provided by (used in) investing activities (902,148) (35,466) 566,714 Net cash used in financing activities (42,998) (406,726) (450,024) Net Cash Provided by Operating Activities Net cash provided by operating activities increased by $85.4 million in 2025 compared to 2024, primarily resulting from improvement in our cost efficiency during the year. Our primary source of cash from operating activities has been cash collections from our premium subscriptions. Our primary uses of cash from operating activities have been selling and marketing expenses, personnel and related overhead costs and other costs related to the provision of our services. We expect cash inflows from operating activities to be affected by increases in sales and the timing of bookings. We expect cash outflows from operating activities to be affected by increases in marketing and increases in personnel costs as we grow our business. For the year ended December 31, 2025, operating activities provided $582.9 million in cash, primarily resulting from $323.2 million as an adjustment of non-cash charges, primarily related to share-based compensation expenses, depreciation and amortization, an increase of $155.8 million in accrued expenses, prepaid expenses and other current liabilities, and an increase of $103.9 million in short- and long-term deferred revenue balances due to an increase in bookings from our premium subscriptions. For the year ended December 31, 2024, operating activities provided $497.4 million in cash, primarily resulting from increases of $74.5 million in short- and long-term deferred revenue balances due to an increase in bookings from our premium subscriptions, and $410.8 million as an adjustment of non-cash charges, primarily related to share-based compensation expenses, and from a decrease in the value of our investment in a publicly held company, depreciation, net income and amortization, and changes of $12.1 million in accrued expenses, prepaid expenses and other current liabilities. Net Cash Provided by (Used in) Investing Activities Net cash provided by (used in) investing activities was $(902.1) million, $(35.5) million and $566.7 million in 2025, 2024 and 2023, respectively. Investing activities have consisted primarily of investment and proceeds from available-for-sale marketable debt securities and trading marketable debt securities, and investment and proceeds from short-term and restricted deposits. In addition, during 2025, the Company purchased two new companies for a total of $23.9 million. Net Cash Used in Financing Activities Net cash used in financing activities was $43.0 million, $406.7 million and $450.0 million in 2025, 2024 and 2023, respectively. Financing activities in 2025 consisted primarily of net proceeds of $1.05 billion from the issuance of convertible senior notes and proceeds from the exercise of share options and from the Employee Stock Purchase Plan (“ESPP”) of $54.8 million, offset by repayment of 2025 Convertible note of $575.0 million and purchase of treasury shares of $575.0 million. We do not believe there are any legal or economic restrictions on the ability of our subsidiaries to transfer funds to us in the form of cash dividends, payments from customers, loans or advances. C. Research and Development, Patents and Licenses, etc. Our research and development activities are primarily located in Israel, with additional employees and contractors engaged in research and development activities in Lithuania, the United States, Poland, Japan, Netherlands, Canada, Australia, Ukraine, and Germany. As a result of the military invasion of Ukraine by Russian forces that began in February 2022, some of our Ukrainian team members have relocated to other countries, and some have relocated within Ukraine. Our research 99 and development department is comprised of 2,530 employees and contractors. In 2025, research and development costs accounted for approximately 32.4% of our total revenues. We employ a strategy of seeking patent protection for some of our technologies. We have filed a number of patent applications and continue to file for patents in the United States as well as in several additional jurisdictions worldwide to protect our inventions as well as PCT applications that may result in additional national applications. As of December 31, 2025, we have (together with our subsidiaries) a total of 356 issued patents (105 in the United States and 251 in other jurisdictions) and 190 pending patent applications (68 in the United States and 122 filed under PCT or in additional regions). We also have 28 issued design patents and 3 pending design patent applications. No patent or patent application is material to the overall conduct of our business. For a description of our research and development policies, see Item 4.B. “Information on the Company—Business Overview—Research and Development.” The Investment and Development Authority for Economic and Industrial Development The Investment and Development Authority for Economic and Industrial Development, or the Investment Authority, works to help and encourage employers to absorb new employees through different employment incentive programs. One of these programs is intended to incentivize employers in national priority areas to create high wage manufacturing and computing jobs. The grants are subject to meeting certain conditions, among others, that: (1) the company must be engaged in certain economic sectors; (2) the company's overall sales turnover in the two years preceding the application date must exceed NIS 15 million, which is approximately $4.7 million; (3) the company must hire at least 15 new employees during the program period; (4) the average monthly wage must be between one to two and a half times the median market wage to be paid during the periods as provided in each high wage employment program; and (5) 60% of the new employees engaged under the program must reside in Jerusalem and/or in national priority areas. We are not required to pay royalties to the Investment Authority. We have one active high wage employment grant program from the Investment Authority and may apply for additional grants in the future. During 2025, we did not receive any grants from any institution. D. Trend Information Other than as disclosed elsewhere in this annual report, including in Item 3.D. “Key Information—Risk Factors” and Item 5. “Operating and Financial Review and Prospects,” we are not aware of any trends, uncertainties, demands, commitments or events for the period since January 1, 2025, that are reasonably likely to have a material effect on our total revenues, income, profitability, liquidity or capital resources, or that caused the disclosed financial information to be not necessarily indicative of future operating results or financial condition. E. Recent Developments Credit Facility On March 3, 2026, we entered into a Credit Facility Agreement with Hapoalim Bank Ltd. (the “Bank”), which provides for a $500 million credit facility, available to be drawn in up to two tranches between April 1, 2026 and March 31, 2027 (the “Credit Facility Agreement”), with the tenor of each drawdown to be determined on the date of the withdrawal. Interest under the Credit Facility Agreement accrues at a variable rate based on monthly SOFR plus the TFSI Basis Bid plus an applicable margin. For the first $400 million drawn, the applicable margin until July 31, 2026 is 0.30% per annum and from August 1, 2026 until March 31, 2027 is 0.40%, and for the final $100 million drawn, the applicable margin is 1.05% per annum until July 31, 2026 and from August 1, 2026 until March 31, 2027 is 1.15%. Interest is payable monthly based on the then-outstanding amount, and principal is repaid upon the tenor of each drawdown. A commitment fee of $30,000 per month is payable until the final $100 million is drawn or cancelled. 100 We have the right to cancel the credit line at any time upon seven days’ notice to the Bank without penalty. We also have the right to prepay any outstanding amount at any time upon 30 days’ notice to the Bank. The Credit Facility Agreement includes a financial covenant requiring the Company to maintain a Bank Debt to Free Cash Flow ratio not exceeding 2.0x. "Bank Debt" is defined in the Credit Facility Agreement as the outstanding bank credit balance not secured by full cash collateral (credit exposure on the Company), excluding lease liabilities, guarantees, rent obligations, intercompany debt, and credit secured by full deposits. "Free Cash Flow" is defined in the Credit Facility Agreement as cash flows from operating activities (as presented in the Company's financial statements) less capital expenditures, excluding one-time/non-recurring expenses. As collateral, we are required to (i) maintain 1 billion NIS in Bank of Israel Bills deposited with the Bank, and (ii) maintain an existing $120 million cash deposit at the Bank, both held in a designated account. The Credit Facility Agreement also contains a negative pledge provision under which the Company agrees not to create a general floating charge on all or substantially all of its assets. Private Placement As previously disclosed, on March 4, 2026, we entered into a Securities Purchase Agreement (the “Purchase Agreement”) with one or more funds managed or advised by Durable Capital Partners LP (“Durable”)and certain other purchasers (collectively, the “Purchasers”). Pursuant to the Purchase Agreement, on March 5, 2026, the Company issued and sold 3,266,699 units at a purchase price of $79.591 per unit. Each unit consists of one ordinary share and one warrant to purchase 0.25 of one ordinary share (the “Warrants”). In total, we issued an aggregate of 3,266,699 ordinary shares and Warrants in respect of 816,674 additional ordinary shares (which are to be settled by net share settlement or cash settlement, at our election, upon exercise) for gross proceeds of approximately $260.0 million (upsized from the $250.0 million previously announced, and including gross proceeds of approximately $162.5 million from the 2,041,688 ordinary shares and Warrants in respect of 510,422 additional ordinary shares issued to Durable), before deducting placement agent fees and offering expenses (the “Private Placement”). Pursuant to the warrant agreement entered into by the Company with the Purchasers as the initial holders of the Warrants (collectively, the “Holders”), each Warrant has an exercise price per ordinary share equal to $104.73 per share, subject to customary anti-dilution adjustments. The exercise price and the number of ordinary shares issuable upon exercise of each Warrant is subject to appropriate adjustments in the event of certain share dividends and distributions, share splits, share combinations, reclassifications or similar events affecting our ordinary shares. The Warrants are exercisable from, and including May 5, 2026, to, and including the third anniversary of the closing date of the Private Placement (the “Closing Date”). Upon the exercise of each Warrant, the Company will pay or deliver, as applicable, to such Holder either (1) cash equal to the “in-the-money” value of such Warrant, if any, or (2) a number of ordinary shares equal to the “in-the-money” value such Warrant, if any, at the Company’s election. In the event that a Warrant is exercised during a specified period following the occurrence of customary “make-whole fundamental change” events, the Holder will receive an additional number of ordinary shares or the cash value of such ordinary shares, depending on the settlement method selected by the Company. The foregoing summary of the Warrants does not purport to be complete and is qualified in its entirety by reference to the Form of Warrant Agreement, filed as Exhibit 4.7 to this annual report. Pursuant to the Purchase Agreement, on or after the date that is ten months after the Closing Date, a Purchaser may make a written request to the Company to file with the Securities and Exchange Commission a registration statement registering the resale of the ordinary shares issued to such Purchaser in the Private Placement and any ordinary shares issuable to such Purchaser upon the exercise of such Purchaser’s Warrants. We agreed to file such registration statement within 30 calendar days after the date of such request (or, in the case of a registration statement on Form F-1, 101 45 calendar days), provided that if we are a well-known seasoned issuer at such time and propose to file an automatically effective registration statement on Form F-3ASR, we will not be required to file such registration statement prior to the last business day immediately preceding the one-year anniversary of the Closing Date. We also agreed to use commercially reasonable efforts to have such registration statement declared effective as soon as practicable after filing, provided that we will not be required to have such registration statement declared effective prior to the last business day immediately preceding the one-year anniversary of the Closing Date. We also agreed, among other things, to indemnify each Purchaser, each person, if any, who controls such Purchaser, each affiliate of such Purchaser, and each broker, placement agent or sales agent to or through which such Purchaser effects or executes the resale of any of the registered securities from certain liabilities. In connection with the Private Placement, the Purchasers have entered into lock-up agreements pursuant to which they have agreed that they will not, among other things, and subject to certain exceptions, sell, transfer, or otherwise dispose of the ordinary shares and Warrants issued to them in the Private Placement, or any ordinary shares that may be issuable to them upon the exercise of the Warrants, during the period ending one year after the Closing Date, without the Company’s prior written consent. In addition, each of our directors and executive officers have entered into lock-up agreements pursuant to which they have agreed that they will not, among other things, and subject to certain exceptions, sell, transfer, or otherwise dispose of any ordinary shares, or any securities convertible into or exercisable or exchangeable for ordinary shares during the period ending 90 days after the Closing Date without the Purchasers’ prior written consent. The Private Placement was exempt from registration pursuant to Section 4(a)(2) of the Securities Act as a transaction by an issuer not involving a public offering. The Purchasers have represented to us that they have acquired the securities for investment only and not with a view to or for sale in connection with any distribution thereof, and appropriate legends have been affixed to the securities issued in this transaction. Tender Offer On March 5, 2026, we commenced a “modified Dutch Auction” tender offer to purchase up to $1.75 billion in aggregate purchase price of our issued and outstanding ordinary shares, or such lesser aggregate purchase price of our ordinary shares as are properly tendered and not properly withdrawn, at a price not greater than $92 nor less than $80 per share to the tendering holder in cash, less any applicable withholding taxes and without interest. The tender offer is scheduled to expire at one (1) minute after 11:59 p.m., New York City time, on April 1, 2026, unless the offer is extended or terminated. The tender offer is subject to a number of terms and conditions. F. Critical Accounting Estimates Our accounting policies and their effect on our financial condition and results of operations are more fully described in our consolidated financial statements included elsewhere in this annual report. We have prepared our financial statements in conformity with U.S. GAAP, which requires management to make estimates and assumptions that in certain circumstances affect the reported amounts of assets and liabilities, revenues and expenses and disclosure of contingent assets and liabilities. These estimates are prepared using our best judgment, after considering past and current events and economic conditions. While management believes the factors evaluated provide a meaningful basis for establishing and applying sound accounting policies, management cannot guarantee that the estimates will always be consistent with actual results. In addition, certain information relied upon by us in preparing such estimates includes internally generated financial and operating information, external market information, when available, and when necessary, information obtained from consultations with third parties. Actual results could differ from these estimates and could have a material adverse effect on our reported results. We believe that the accounting policies discussed below are critical to our financial results and to the understanding of our past and future performance, as these policies involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations. 102 Revenue Recognition Our total revenues consist of Creative Subscriptions Revenues and Business Solutions Revenues. Arrangements with our customers do not provide the customers with the right to take possession of the software supporting our platform at any time and are therefore accounted for as service contracts. Our revenue recognition policy is consistent for sales generated directly with end customers and indirect sales generated through partners. We recognize revenue when control of the promised products or services is transferred to a customer, in an amount reflecting the consideration we expect to be entitled to in exchange for these products or services. Revenue is recognized net of allowances for refunds, consideration payable to customers, and any taxes collected from customers, which are subsequently remitted to governmental authorities. Our arrangements with customers may include multiple performance obligations. For arrangements with multiple distinct performance obligations, we allocate consideration to each distinct performance obligation based on its relative stand-alone selling price (“SSP”). We generally determine SSP based on observable selling prices. We follow the guidance provided in ASC Topic 606, Revenues from Contracts with Customers (“ASC 606”), for determining whether we are a principal (i.e., report revenues on a gross basis) or an agent (i.e., report revenues on a net basis) in arrangements with customers that involve another party that contributes to providing specified products or services to a customer. We determine whether the nature of our promise is to provide the specified products or services itself (as a principal) or to arrange for those specified products or services to be provided by another party (as an agent), based on whether we control the specified products or services before they are transferred to the end customer. In making this determination, we evaluate indicators such as which party is primarily responsible for fulfillment and has discretion in determining pricing. This determination is reviewed for each specified service promised to the customer and may involve significant judgment. Revenues generated from the sale of domain name registrations and the sale of certain integrated solutions, including Google Workspace and Wix Payments, are typically recorded on a gross basis, meaning the amounts billed to customers are recorded as revenues and expenses incurred are recorded as cost of revenues, since we have determined that we control the promised products or services before they are transferred to the end customer. Revenues generated from the sale of third-party software applications are typically recognized on a net basis, as we have determined that we act as an agent in these arrangements. Business Combinations We account for business combinations in accordance with ASC Topic 805, Business Combinations (“ASC 805”). ASC 805 requires us to recognize the assets acquired, liabilities assumed and any non-controlling interests as of the acquisition date at their respective fair values. Any excess of the purchase price over the fair value of the identifiable net assets acquired is recorded as goodwill. If applicable, we recognize a contingent consideration liability at fair value as of the acquisition date and include it in the purchase price. The fair value of contingent consideration is estimated using a Monte Carlo simulation model, which incorporates significant unobservable inputs, including projected revenue-related metrics and revenue volatility. We remeasure the contingent consideration liability to fair value each reporting period based on updated assumptions, with changes recognized in the statement of comprehensive income within general and administrative expenses. Because these estimates involve significant judgment and are based on inherently uncertain forecasts, actual results may differ from our estimates. During the measurement period, which may extend for up to one year from the acquisition date, we may record adjustments to the provisional fair values of the assets acquired and liabilities assumed, with a corresponding adjustment to goodwill. Upon the earlier of the end of the measurement period or the final determination of the fair values of the assets acquired and liabilities assumed, any subsequent adjustments are recorded in the statement of comprehensive income. Income Taxes We account for income taxes in accordance with ASC Topic 740, Income Taxes (“ASC 740”), using the liability method, whereby deferred tax assets and liabilities account balances are determined based on the differences between financial reporting and the tax basis for our assets and liabilities and for carry-forward tax losses, and are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. We recognize a valuation 103 allowance, if necessary, to reduce deferred tax assets to their estimated realizable value, if it is more likely than not that some portion of the entire deferred tax asset will not be realized. In making such a determination, we consider all available positive and negative evidence, including results of recent operations, future reversals of existing taxable temporary differences, and projected future taxable income. We classify all deferred tax assets and liabilities as non-current on the consolidated balance sheets. We recognize the tax benefit from an uncertain tax position only if it is more-likely-than-not that the tax position will be sustained on examination by taxing authorities, including resolution of any related appeals or litigation processes, based on the technical merits of the position. We recognize interest and penalties, if any, related to unrecognized tax benefits as income tax expense. 104