Document and Entity Information
Document and Entity Information | 12 Months Ended |
Dec. 31, 2020shares | |
Entity Central Index Key | 0001576789 |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2020 |
Document Fiscal Period Focus | FY |
Amendment Flag | false |
Document Type | 20-F |
Document Registration Statement | false |
Document Annual Report | true |
Document Transition Report | false |
Document Shell Company Report | false |
Document Period End Date | Dec. 31, 2020 |
Entity File Number | 001-36158 |
Entity Registrant Name | WIX.COM LTD. |
Entity Incorporation, State or Country Code | IL |
Entity Address, Address Line One | 40 Namal Tel Aviv St. |
Entity Address, City or Town | Tel Aviv |
Entity Address, Country | IL |
Entity Address, Postal Zip Code | 6350671 |
Title of 12(b) Security | Ordinary shares, par value NIS 0.01 per share |
Trading Symbol | WIX |
Name of Exchange on which Security is Registered | NASDAQ |
Entity Well-known Seasoned Issuer | Yes |
Entity Voluntary Filers | No |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Emerging Growth Company | false |
Document Accounting Standard | U.S. GAAP |
Auditor Attestation Flag | true |
Entity Shell Company | false |
Entity Common Stock, Shares Outstanding | 56,027,758 |
Business Contact [Member] | |
Entity Registrant Name | Wix.com Ltd. |
Contact Personnel Name | Eitan Israeli |
Entity Address, Address Line One | 40 Namal Tel Aviv St. |
Entity Address, City or Town | Tel Aviv |
Entity Address, Country | IL |
Entity Address, Postal Zip Code | 6350671 |
City Area Code | 972 (3) |
Local Phone Number | 545-4900 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 168,858 | $ 268,103 |
Short-term deposits | 577,138 | 294,096 |
Restricted deposits | 925 | 1,149 |
Marketable securities | 289,927 | 164,301 |
Trade receivables | 23,670 | 16,987 |
Prepaid expenses and other current assets | 40,666 | 19,211 |
Total current assets | 1,101,184 | 763,847 |
LONG-TERM ASSETS: | ||
Prepaid expenses and other long-term assets | 87,680 | 9,926 |
Property and equipment, net | 35,863 | 31,706 |
Marketable securities | 536,877 | 177,298 |
Intangible assets, net | 19,281 | 19,841 |
Goodwill | 24,235 | 17,800 |
Operating lease right-of-use assets | 88,406 | 79,249 |
Total long-term assets | 792,342 | 335,820 |
TOTAL ASSETS | 1,893,526 | 1,099,667 |
CURRENT LIABILITIES: | ||
Trade payables | 79,881 | 37,687 |
Employees and payroll accruals | 70,814 | 41,938 |
Deferred revenues | 373,521 | 289,148 |
Accrued expenses and other current liabilities | 70,429 | 56,464 |
Operating lease liabilities | 22,336 | 18,949 |
Total current liabilities | 616,981 | 444,186 |
LONG-TERM LIABILITIES: | ||
Convertible notes, net | 834,440 | 358,715 |
Long-term deferred revenues | 50,867 | 21,969 |
Long-term deferred tax liabilities | 15,343 | 1,585 |
Long-term loan | 1,219 | |
Long-term operating lease liabilities | 74,187 | 64,244 |
Total long-term liabilities | 974,837 | 447,732 |
TOTAL LIABILITIES | 1,591,818 | 891,918 |
SHAREHOLDERS' EQUITY: | ||
Ordinary shares of NIS 0.01 par value - Authorized: 500,000,000 shares at December 31, 2019 and 2020; Issued and outstanding: 51,525,919 and 56,027,758 shares at December 31, 2019 and 2020, respectively | 107 | 94 |
Additional paid-in capital | 862,134 | 611,083 |
Accumulated other comprehensive income | 9,406 | 1,357 |
Accumulated deficit | (569,939) | (404,785) |
Total shareholders' equity | 301,708 | 207,749 |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 1,893,526 | $ 1,099,667 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - ₪ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Ordinary shares, par value | ₪ 0.01 | ₪ 0.01 |
Ordinary shares, shares authorized | 500,000,000 | 500,000,000 |
Ordinary shares, shares issued | 56,027,758 | 51,525,919 |
Ordinary shares, shares outstanding | 56,027,758 | 51,525,919 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | $ 988,760 | $ 761,088 | $ 603,704 |
Cost of Revenues | 315,699 | 196,907 | 126,947 |
Gross profit | 673,061 | 564,181 | 476,757 |
Research and development, net | 320,278 | 250,791 | 198,912 |
Selling and marketing | 438,210 | 307,718 | 249,178 |
General and administrative | 111,915 | 85,922 | 59,297 |
Total operating expenses | 870,403 | 644,431 | 507,387 |
Operating loss | (197,342) | (80,250) | (30,630) |
Financial income (expenses), net | 47,059 | (3,621) | (2,794) |
Other income (expenses) | 118 | 55 | (489) |
Loss before taxes on income | (150,165) | (83,816) | (33,913) |
Taxes on income | 14,989 | 2,598 | 3,207 |
Net loss | (165,154) | (86,414) | (37,120) |
Other comprehensive loss: | |||
Unrealized gains (loss) from marketable securities, net of tax | 2,916 | 1,167 | (24) |
Unrealized gains (loss) on cash flow hedge, net of tax | 5,133 | 1,881 | (1,381) |
Other comprehensive income (loss) for the year, net of tax | 8,049 | 3,048 | (1,405) |
Total comprehensive loss | $ (157,105) | $ (83,366) | $ (38,525) |
Basic and diluted net loss per ordinary share | $ (3.03) | $ (1.71) | $ (0.77) |
Creative Subscription [Member] | |||
Revenues | $ 783,456 | $ 644,491 | $ 525,350 |
Cost of Revenues | 167,539 | 120,905 | 84,752 |
Business Solutions [Member] | |||
Revenues | 205,304 | 116,597 | 78,354 |
Cost of Revenues | $ 148,160 | $ 76,002 | $ 42,195 |
STATEMENTS OF CHANGES IN SHAREH
STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY - USD ($) $ in Thousands | Ordinary shares [Member] | Additional paid-in capitall [Member] | Other comprehensive loss [Member] | Accumulated deficit [Member] | Total | |
Balance at Dec. 31, 2017 | $ 80 | $ 311,107 | $ (286) | $ (299,581) | $ 11,320 | |
Balance, shares at Dec. 31, 2017 | 46,453,583 | |||||
Exercise of options and ESPP shares | $ 8 | 31,764 | 31,772 | |||
Exercise of options and ESPP shares, shares | 2,816,043 | |||||
Share-based compensation | 72,330 | 72,330 | ||||
Equity Component of Convertible senior notes | 57,038 | 57,038 | ||||
Effect of adopting new accounting standard, Revenue from Contracts with Customers | 18,330 | 18,330 | ||||
Other comprehensive income (loss) | (1,405) | (1,405) | ||||
Net loss | (37,120) | (37,120) | ||||
Balance at Dec. 31, 2018 | $ 88 | 472,239 | (1,691) | (318,371) | 152,265 | |
Balance, shares at Dec. 31, 2018 | 49,269,626 | |||||
Exercise of options and ESPP shares | $ 6 | 29,368 | 29,368 | |||
Exercise of options and ESPP shares, shares | 2,256,293 | |||||
Share-based compensation | 109,476 | 109,476 | ||||
Other comprehensive income (loss) | 3,048 | 3,048 | ||||
Net loss | (86,414) | (86,414) | ||||
Balance at Dec. 31, 2019 | $ 94 | 611,083 | 1,357 | (404,785) | 207,749 | |
Balance, shares at Dec. 31, 2019 | 51,525,919 | |||||
Exercise of options and ESPP shares | $ 13 | 36,096 | 36,109 | |||
Exercise of options and ESPP shares, shares | 4,501,124 | |||||
Share-based compensation | 147,439 | 147,439 | ||||
Equity Component of Convertible senior notes | 67,337 | 67,337 | ||||
Conversion of Convertible senior notes | [1] | 179 | 179 | |||
Conversion of Convertible senior notes, shares | 715 | |||||
Other comprehensive income (loss) | 8,049 | 8,049 | ||||
Net loss | (165,154) | (165,154) | ||||
Balance at Dec. 31, 2020 | $ 107 | $ 862,134 | $ 9,406 | $ (569,939) | $ 301,708 | |
Balance, shares at Dec. 31, 2020 | 56,027,758 | |||||
[1] | represent amount lower than $1. |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net loss | $ (165,154) | $ (86,414) | $ (37,120) |
Adjustments to reconcile net loss to net cash provided by operating activities: | |||
Depreciation | 14,610 | 12,126 | 8,724 |
Amortization of intangible assets | 2,577 | 4,588 | 2,784 |
Share based compensation expenses | 147,313 | 109,337 | 72,330 |
Amortization of debt discount and debt issuance costs | 29,954 | 20,938 | 10,004 |
Decrease (increase) in accrued interest and exchange rate on short-term and long-term deposits | (43) | 748 | (583) |
Amortization of premium,discount and accrued interest on marketable securities, net | 4,471 | (346) | (99) |
Deferred taxes, net | 12,089 | 935 | (959) |
Changes in operating lease right-of-use assets | 17,867 | 18,225 | |
Changes in operating lease liabilities | (15,807) | (15,376) | |
Increase in trade receivables | (6,457) | (3,459) | (2,128) |
Increase in prepaid expenses and other current and long-term assets | (89,386) | (5,168) | (3,665) |
Increase (decrease) in trade payables | 41,967 | (7,560) | 10,933 |
Increase in employees and payroll accruals | 25,326 | 7,781 | 2,843 |
Increase in short-term and long-term deferred revenues | 113,271 | 71,397 | 54,681 |
Increase (decrease) in accrued expenses and other current liabilities | 15,451 | 21,812 | (2,036) |
Net cash provided by operating activities | 148,049 | 149,564 | 115,709 |
Cash flows from investing activities: | |||
Proceeds from short-term and restricted deposits | 294,225 | 348,775 | 204,125 |
Investment in short-term and restricted deposits | (577,000) | (296,100) | (437,979) |
Investment in marketable securities | (763,581) | (402,774) | (58,963) |
Proceeds from marketable securities | 277,335 | 132,905 | 21,054 |
Purchase of property and equipment | (18,403) | (21,427) | (13,684) |
Capitalization of internal use of software | (450) | (639) | (392) |
Payments for businesses acquired, net of acquired cash | (6,626) | ||
Purchases of investments in privately held companies | (1,185) | (3,862) | (1,250) |
Proceeds from realization of investments in privately-held company | 1,098 | ||
Investment in other long-term assets | (5,643) | (891) | (500) |
Net cash used in investing activities | (800,230) | (244,013) | (287,589) |
Cash flows from financing activities: | |||
Proceeds from issuance of convertible senior notes | 575,000 | 442,750 | |
Payments of debt issuance costs | (15,713) | (12,601) | |
Purchase of capped call | (46,000) | (45,338) | |
Proceeds from exercise of options and ESPP shares | 39,649 | 31,495 | 32,896 |
Net cash provided by financing activities | 552,936 | 31,495 | 417,707 |
Increase (decrease) in cash and cash equivalents | (99,245) | (62,954) | 245,827 |
Cash and cash equivalents at the beginning of the year | 268,103 | 331,057 | 85,230 |
Cash and cash equivalents at the end of the year | 168,858 | 268,103 | 331,057 |
Supplemental disclosure of cash flow activities: | |||
Cash paid during the year for taxes | 5,810 | 3,109 | 3,666 |
Interest received during the year | 18,647 | 18,996 | 8,364 |
Supplemental information for non- cash transactions | |||
Right-of-use asset recognized with corresponding lease liability | 29,137 | 46,121 | |
Non-cash purchase of property and equipment | $ 1,007 | $ 1,232 | $ 1,413 |
GENERAL
GENERAL | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL | NOTE 1:- GENERAL Wix.com Ltd. ,an Israeli corporation (was incorporated in October, 2006), and subsidiaries (collectively, the “Company” or “Wix”), is leading the way with a cloud-based website development platform. The Wix website builder was founded on the belief that the Internet should be accessible to everyone to develop, create and contribute. Through free and premium subscriptions, Wix empowers millions of businesses, organizations, artists, and individuals to take their businesses, brands and workflow online. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP"). a. Use of estimates: The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The accounting estimates that require management’s subjective judgments include, but are not limited to, revenue recognition, income taxes, share-based compensation and purchase price allocation on acquisitions including determination of useful lives, Incremental Borrowing Rate (“IBR”), convertible notes borrowing rate and contingent consideration. The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates. The novel coronavirus (“COVID-19”) pandemic has created, and may continue to create, significant uncertainty in macroeconomic conditions. The Company considered the impact of COVID-19 on the estimates and assumptions and determined that there were no material adverse impacts on the consolidated financial statements for the period ended December 31, 2020. As events continue to evolve and additional information becomes available, the Company’s estimates and assumptions may change materially in future periods. b. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances, have been eliminated upon consolidation. c. Financial statements in U.S. dollars: A substantial portion of the Company's financing activities, including equity transactions, cash investments, costs and revenues are generated in U.S. dollars. The Company's management believes that the U.S. dollar is the currency of the primary economic environment in which the Company operates. Thus, the functional and reporting currency of the Company is the U.S. dollar. The Company's subsidiaries’ functional currency is the currency of the primary economic environment in which the subsidiary operates; normally, that is the currency of the environment in which a subsidiary primarily generates and expends cash. In making the determination of the appropriate functional currency for the subsidiaries, the Company considers cash flow indicators, local market indicators, financing indicators and the subsidiary’s relationship with both the parent company and other subsidiaries. For subsidiaries that are primarily a direct and integral component or extension of the parent entity’s operations, the U.S. dollar is the functional currency. F - 11 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Accordingly, monetary accounts maintained in currencies other than the U.S. dollar are remeasured into U.S. dollars in accordance with Statement of the Accounting Standard Codification ("ASC") No. 830 "Foreign Currency Matters" ("ASC No. 830"). All transaction gains and losses of the remeasured monetary balance sheet items are reflected in the statement of comprehensive loss as financial income or expenses, as appropriate. d. Cash and cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less, at the date acquired. e. Short-term deposits: Short-term deposits are deposits with maturities over three months from the date of purchase and of up to one year. As of December 31, 2019 and 2020, the Company's bank deposits were denominated in U.S. dollars and New Israel Shekels (NIS) and bore interest at weighted average interest rates of 2.86% and 1.21%, respectively. Short-term deposits are presented at their cost, including accrued interest. f. Restricted deposits: Restricted deposits are deposits with maturities of up to one year and are used as security for the rental of premises and for the Company's credit cards. As of December 31, 2019 and 2020, the Company's bank deposits were in U.S. dollars and bore interest at weighted average interest rates of 0.05% and 0.038%, respectively. Restricted deposits are presented at their cost, including accrued interest upon the term of the remaining restrictions. g. Marketable securities: The Company’s marketable securities consist of U.S. federal deposit insured corporation, Treasury bonds, certificate of deposits, sovereign bonds, municipal bonds and corporate bonds. The Company accounts for investments in debt securities in accordance with ASC No. 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in debt securities at the time of purchase and re-evaluates such determinations at each balance sheet date. Marketable securities are classified as available for sale at the time of purchase. Available-for-sale securities are carried at fair value based on quoted market prices, with the unrealized gains and losses, reported in accumulated other comprehensive income (loss) in shareholders’ equity. Realized gains and losses on sale of investments are included in financial income, net and are derived using the specific identification method for determining the cost of securities sold. Interest on these securities, as well as amortization or accretion of premiums or discounts, are included in financial income, net. F - 12 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company classifies its marketable securities as either short-term or long-term based on each instruments’ underlying contractual maturity date as well as the intended time of realization. Marketable securities with maturities of 12 months or less are classified as short-term, and marketable securities with maturities greater than 12 months are classified as long-term. In 2020 the Company adopted ASU 2016-13, Topic 326 “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments” which modified the other than temporary impairment model for available for sale debt securities. The guidance requires the Company to determine whether a decline in fair value below the amortized cost basis of an available for sale debt security is due to credit related factors or noncredit related factors. A credit related impairment should be recognized as an allowance on the balance sheet with a corresponding adjustment to earnings, however, if the Company intends to sell an impaired available for sale debt security or more likely than not would be required to sell such a security before recovering its amortized cost basis, the entire impairment amount would be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. The Company did not recognize an allowance for credit losses on marketable securities as the expected losses were not material for the year ended December 31, 2020. No other than temporary impairment losses were recorded for the years ended December 31, 2019 and 2018. h. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and electronic equipment 15 – 33 (mainly 33) Internal use software 33 Office furniture and equipment 6 – 14 (mainly 6) Vehicles 15 Leasehold improvements Over the shorter of the related lease period or the life of the asset F - 13 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) i. Impairment of Long-lived assets and intangible assets subject to amortization: The long-lived assets of the Company are reviewed for impairment in accordance with ASC No. 360, "Property, Plant and Equipment" ("ASC No. 360"), whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the years ended December 31, 2018, 2019 and 2020, no impairment losses have been identified. j. Business combinations: The Company accounted for business combination in accordance with ASC No. 805, "Business Combinations". ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price is allocated to goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and in acquired income tax position are to be recognized in earnings. The Company accounts for a transaction that does not meet the definition of a business as an asset acquisition Under ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business (“2017-01”), the Company first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the single asset or group of assets, as applicable, is not a business. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. k. Goodwill and intangible assets: Goodwill and certain other purchased intangible assets have been recorded in the Company's financial statements as a result of acquisitions. Goodwill represents excess of the costs over the net tangible and intangible assets acquired of businesses acquired Under ASC No. 350, "Intangible - Goodwill and other", ("ASC No. 350") goodwill is not amortized, but rather is subject to impairment test. In addition, the costs of intangible assets that were purchased from others for use in research and development activities were recorded as assets to the extent that they have alternative future use. ASC No. 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, quantitative test is performed. F - 14 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Alternatively, ASC No. 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the quantitative goodwill impairment test. The Company operates in one reporting segment, and this segment comprises its only reporting unit. Therefore, goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value. The Company elects to perform an annual impairment test of goodwill as of October 1 of each year, or more frequently if impairment indicators are present. Intangible assets that are considered to have definite useful life are amortized using the straight-line basis over their estimated useful lives, which weighted average amortization period of 13 years. The carrying amount of these assets is reviewed whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of the asset to the future undiscounted cash flows the asset is expected to generate. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. As of December 31, 2018, 2019 and 2020, no impairment losses have been recognized. l. Investments in privately held companies: The Company's non-marketable equity securities are investments in privately held companies without readily determinable market values. Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01, which changed the way it accounts for non-marketable securities on a prospective basis. The Company's equity investments are investments in equity securities of privately held companies without readily determinable market values. The Company elected to account for its equity investments using the measurement alternative, which is cost, less any impairment, adjusted for changes in fair value resulting from observable transactions for identical or similar investments of the same issuer. The investments are reviewed periodically to determine if their respective values have appreciated or have been impaired, and adjustments are recorded as necessary. During the year ended December 31, 2020, the Company recorded an income in amount of $67,084 related to revaluation of its investments in privately held companies based on observable price changes. This includes $66,709 of appreciation of valuation related to holdings in a privately held company, which the Company has held since 2012. F - 15 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) m. Derivatives instruments: ASC No. 815, "Derivative and Hedging" ("ASC No. 815"), requires companies to recognize all of their derivative instruments as either assets or liabilities in the statement of balance sheets at fair value. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. Derivative instruments designated as hedging instruments: In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” amending the eligibility criteria for hedged items and transactions to expand an entity’s ability to hedge nonfinancial and financial risk components. The new guidance eliminates the requirement to separately measure and present hedge ineffectiveness and aligns the presentation of hedge gains and losses with the underlying hedge item. The new guidance also simplifies the hedge documentation and hedge effectiveness assessment requirements. The amended presentation and disclosure requirements must be adopted on a prospective basis, while any amendments to cash flow and net investment hedge relationships that exist on the date of adoption must be applied on a “modified retrospective” basis, meaning a cumulative effect adjustment to the opening balance of retained earnings as of the beginning of the year of adoption. The new guidance was effective on January 1, 2019, and the adoption did not have a material impact on our consolidated financial statements. The net fair value of derivative instruments balance as of December 31, 2019 and 2020, totaled $888 and $6,841, respectively and is presented as prepaid expenses and other current assets. In the years ended December 31, 2018, 2019 and 2020, the Company recorded as operating income (expenses) net from hedging transactions in the amount of $(1,687), $147, and $1,582, respectively. To hedge against the risk of overall changes in cash flows resulting from foreign currency salary payments, rent and other overhead vendors during the year, the Company has instituted a foreign currency cash flow hedging program. The Company hedges portions of its forecasted salary, rent and other overhead cash flow denominated in NIS. Options and forward contracts are designated as cash flow hedges, as defined by ASC No. 815, and are all effective. As of December 31, 2020, the gross amount recorded in accumulated other comprehensive income from the Company's currency option transactions is $6,841. At December 31, 2020, the notional amounts of foreign exchange forward and options contracts into which the Company entered were $45,000. The foreign exchange forward and options contracts will expire throughout 2021. F - 16 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Derivative instruments not designated as hedging instruments: In addition to the derivatives that are designated as hedges as discussed above, the Company enters into certain foreign exchange forward and option transactions to economically hedge certain revenue transactions in Euros, British pounds, Brazilian Real, Mexican Pesos and Japanese Yen and expenses in NIS. Gains and losses related to such derivative instruments are recorded in financial expenses, net. At December 31, 2020, the notional amounts of foreign exchange forward and options contracts into which the Company entered were $111,372. The foreign exchange forward and option transactions will expire through 2021. The net fair value of derivative instruments balance as of December 31, 2019 and 2020, totaled $(119) and $(1,719), respectively, and is presented as accrued expenses and other current liabilities. In the years ended December 31, 2018, 2019 and 2020, the Company recorded financial income (expenses), net from hedging transactions in the amount of $1,435, $963, and $(5,529) respectively. n. Severance pay: The Israeli Severance Pay Law, 1963 ("Severance Pay Law"), specifies that employees are entitled to severance payment, following the termination of their employment. Under the Severance Pay Law, the severance payment is calculated as one month salary for each year of employment, or a portion thereof. The majority of the Company's liability for severance pay is covered by the provisions of Section 14 of the Severance Pay Law ("Section 14"). Under Section 14 employees are entitled to monthly deposits, at a rate of 8.33% of their monthly salary, continued on their behalf to their insurance funds. Payments in accordance with Section 14 release the Company from any future severance payments in respect of those employees. As a result, the Company does not recognize any liability for severance pay due to these employees and the deposits under Section 14 are not recorded as an asset in the Company's balance sheet. Severance expense for the years ended December 31, 2018, 2019 and 2020, amounted to $9,489, $12,042 and $15,737, respectively. o. U.S. employees defined contribution plan: The U.S. Subsidiary has a 401(k) defined contribution plan covering certain employees in the U.S. All eligible employees may elect to contribute up to 100%, but generally not greater than $19 per year (for certain employees over 50 years of age the maximum contribution is $25 per year), of their annual compensation to the plan through salary deferrals, subject to Internal Revenue Service limits. F - 17 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The U.S. Subsidiary matches 4% of employee contributions up to the plan with no limitation. During the years ended December 31, 2018, 2019 and 2020, the U.S. Subsidiary recorded expenses for matching contributions in amounts of $587, $727, and $1,117, respectively. p. Convertible senior notes: The Company accounts for the issuance of convertible senior notes in accordance with FASB ASC Subtopic 470-20, Debt with Conversion and Other Options. Pursuant to ASC Subtopic 470-20, as the Notes have a net settlement feature and may be settled wholly or partially in cash upon conversion, the Company is required to separately account for the liability (debt) and equity (conversion option) components of the instrument. The carrying amount of the liability component is computed by estimating the fair value of a similar liability without the conversion option. The amount of the equity component is then calculated by deducting the fair value of the liability component from the principal amount of the instrument. This difference represents a debt discount that is amortized to interest expense over the respective terms of the Notes using an effective interest rate method. In accounting for the issuance costs related to the Notes, the allocation of issuance costs incurred between the liability and equity components were based on their relative values. q. Revenue recognition: The Company recognized revenue in accordance with Topic 606 when, or as, control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenue is recognized net of allowances for refunds and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company applies the following five steps: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied. The Company offers a 14-day money back guaranty ("Guaranty Period") on new premium subscription. The Company considers such amount collected from new premium subscriptions as customer deposits until the end of the 14-day trial period. Revenues are recognized once the Guaranty Period has expired. The Company's revenue is categorized and disaggregated as reflected in the statements of operations, as follows: F - 18 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Creative Subscriptions Revenues from premium subscriptions are recognized on a straight-line basis over the contract period, since the customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs. Revenues related to the purchase and registration of domain names are recognized at the full amount paid by the customer at a point in time upon the purchase and registration of the domain name, since that is when the Company satisfies the performance obligation. Business Solutions Revenues related to Google's G-Suite application is recognized at a point in time upon the purchase, since that is when the Company satisfies the performance obligation. Other subscriptions and software applications developed by the Company are recognized on a straight-line basis over the contract period, since the customer simultaneously receives and consumes the benefits provided by our performance as the Company performs. Revenues related to third-party software applications are recognized on a net basis at a point in time upon purchase of the application, since that is when the Company completes its obligation to facilitate the transfer between the customer and the third-party developer. Revenue related to the sale of online advertising inventory (ad space) and other related advertising services to brands and advertising agencies are recognized at a point in time, when an ad space is sold. Revenues related to Payments by Wix 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. In cases where the Company conclude that it is not the primary obligor, the Comapny recognizes revenue from revenue share arrangements on net basis. Each of our goods and services is sold separately, therefore standalone selling prices (SSP) for each of them is observed, and allocation of the transaction price between the performance obligations in the contract is made relatively on that basis. Refunds are estimated at contract inception and updated at the end of each reporting period if additional information becomes available. Principal versus Agent Considerations The Company sells its products directly to customers and also through a network of resellers. In certain cases, the Company acts as a reseller of products provided by others. The determination of gross or net revenue recognition is reviewed on a product-by-product basis and is dependent on the Company's determination as to whether it acts as principal or agent in the transaction. Revenue associated with sales through the Company's network of resellers, for certain domain sales, for third-party offerings including Google's G-Suite application and fees related to Payments by Wix is recorded on a gross basis as the Company has determined that the Company controls the product before transferring it to the end customers, responsible for fulfilling the promise to provide the service and act as primary obligor. Revenues related to third-party software applications when the Company does not control the product or service before transferring to the customers are recognized on a net basis. F - 19 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company uses the practical expedient and does not assess the existence of a significant financing component when the difference between payment and revenue recognition is a year or less. r. Research and development costs: Research and development costs are charged to the statements of comprehensive loss as incurred. s. Internal use software costs: The Company capitalized costs related to the online platform for internal use incurred during the application development stage. Costs incurred in the process of software production are charged to expenses as incurred. Certain software development costs are capitalized under ASC 350-40, Internal-Use Software and are included in property and equipment, net in the consolidated balance sheets. Capitalization of such costs begins when the preliminary project stage is complete and ceases at the point in which the project is substantially complete and is ready for its intended purpose. During 2018, 2019 and 2020, the Company capitalized $392, $778 and $575, respectively. t. Advertising expenses: Advertising expenses consist primarily of cost-per click expenses, social networking expenses, marketing campaigns and display advertisements. Advertising expenses are charged to the statement of comprehensive loss, as incurred. Advertising expenses for the years ended December 31, 2018, 2019 and 2020 amounted to $165,319, $187,318 and $282,804, respectively. u. Share-based compensation: The Company accounts for share-based compensation in accordance with ASC 718, "Compensation - Stock Compensation" ("ASC No. 718"). ASC No. 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statements of comprehensive loss. F - 20 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company recognizes compensation expenses for the value of its awards granted based on the straight-line method over the requisite service period of each of the awards, net of estimated forfeitures. The Company estimates forfeitures at the grant date, and revises its estimate if necessary, in subsequent periods if actual forfeitures differ from those estimates. Some of the options granted are subject to certain performance criteria: accordingly compensation expense is recognized for such awards when it becomes probable that the related performance condition will be satisfied. The Company selected the Black-Scholes-Merton option pricing model as the most appropriate model for determining the fair value for its stock options awards and Employee Stock Purchase Plan, whereas the fair value of restricted stock units is based on the closing market value of the underlying shares at the date of grant. The option-pricing model requires several assumptions, of which the most significant are the expected share price, volatility and the expected option term. Expected volatility was calculated based upon actual historical stock price movements over the most recent periods ending on the grant date, equal to the expected term of the options. The expected term of options granted is based upon historical experience and represents the period of time between when the options are granted and when they are expected to be exercised. The risk-free interest rate is based on the yield from U.S. treasury bonds with an equivalent term to the expected term of the options. The Company applies ASU 2018-07, "Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting" with respect to options and warrants issued to non-employees consultants. ASC No. 718 requires the use of option valuation models to measure the fair value of the options and warrants at the date of grant. F - 21 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) v. Income taxes: The Company accounts for income taxes in accordance with ASC No. 740, "Income Taxes" ("ASC No. 740"). This codification prescribes the use of the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and for carry-forward tax losses. Deferred taxes are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that some portion or all of the deferred tax asset will not be realized. The deferred tax assets and liabilities are classified as noncurrent in the statement of financial position The Company accounts for uncertain tax positions in accordance with the provisions of ASC No. 740. Accounting guidance addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements, under which a company may 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 the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. Accordingly, the Company reports a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in tax expense. w. Basic and diluted net loss per share: Basic and diluted net loss per share is computed based on the weighted-average number of ordinary shares outstanding during each year. Diluted loss per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus dilutive potential shares considered outstanding during the period, in accordance with ASC 260-10. Basic and dil |
MARKETABLE SECURITIES
MARKETABLE SECURITIES | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
MARKETABLE SECURITIES | NOTE 3:- MARKETABLE SECURITIES: As of December 31, 2019 and 2020, the Company held marketable securities classified as available-for-sale securities as follows: December 31, 2020 2019 LESS THAN A YEAR Amortized cost Gross unrealized gains Gross unrealized losses Fair value Amortized cost Gross unrealized gains Gross unrealized losses Fair value Government and corporate debentures - fixed interest rate $ 244,434 $ 526 $ (48 ) $ 244,912 $ 148,437 $ 329 $ (15 ) $ 148,751 Government-sponsored enterprises 10,006 32 - 10,038 12,548 - (1 ) 12,547 Government and corporate debentures - floating interest rate 34,967 10 - 34,977 3,003 1 (1 ) 3,003 $ 289,407 $ 568 $ (48 ) $ 289,927 $ 163,988 $ 330 $ (17 ) $ 164,301 December 31, 2020 2019 MORE THAN 1 YEAR THROUGH FIVE YEARS Amortized cost Gross unrealized gains Gross unrealized losses Fair value Amortized cost Gross unrealized gains Gross unrealized losses Fair value Government and corporate debentures - fixed interest rate $ 494,520 $ 3,821 $ (143 ) $ 498,198 $ 135,040 $ 595 $ (65 ) $ 135,570 Government-sponsored enterprises 21,264 67 - 21,331 17,579 9 (3 ) 17,585 Government and corporate debentures - floating interest rate 17,331 24 (7 ) 17,348 24,141 8 (6 ) 24,143 $ 533,115 $ 3,912 $ (150 ) $ 536,877 $ 176,760 $ 612 $ (74 ) $ 177,298 The gross unrealized losses on the Company's marketable securities were not material as of December 31, 2020 and 2019. The allowance for credit losses was not material as of December 31, 2020. |
PREPAID EXPENSES AND OTHER CURR
PREPAID EXPENSES AND OTHER CURRENT ASSETS | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
PREPAID EXPENSES AND OTHER CURRENT ASSETS | NOTE 4:- PREPAID EXPENSES AND OTHER CURRENT ASSETS December 31, 2020 2019 Government authorities $ 7,381 $ 3,548 Hedging transaction asset 7,083 1,465 Prepaid expenses 13,984 8,468 Other current assets 12,218 5,730 $ 40,666 $ 19,211 |
PROPERTY AND EQUIPMENT, NET
PROPERTY AND EQUIPMENT, NET | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment, Net [Abstract] | |
PROPERTY AND EQUIPMENT, NET | NOTE 5:- PROPERTY AND EQUIPMENT, NET The composition of property and equipment, net is as follows: December 31, 2020 2019 Cost: Leasehold improvements $ 41,101 $ 34,831 Computers, peripheral equipment and electronic equipment 27,449 22,534 Internal use software 2,467 1,891 Office furniture and equipment 6,464 5,664 Vehicles 130 - 77,611 64,920 Less - accumulated depreciation 41,748 33,214 Depreciated cost $ 35,863 $ 31,706 Depreciation expense amounted to $8,724, $12,126 and $14,610 for the years ended December 31, 2018, 2019 and 2020, respectively . During 2019 and 2020, the Company recorded a reduction of $2,841 and $5,923 to the cost and accumulated depreciation of fully depreciated equipment no longer in use, following an assessment made by the Company. |
BUSINESS COMBINATION
BUSINESS COMBINATION | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
BUSINESS COMBINATION | NOTE 6:- BUSINESS COMBINATION In February 2020, the Company acquired 100% of the capital shares of Inkfrog, Inc., (“InkFrog“) a privately held Arizona based corporation, for cash consideration of $10,000 out of which $3,500 was placed in escrow to be released in three installments over two years. Inkfrog's product provides sales channel solutions, with a focus on listings, orders, inventory management and CRM. The following table summarizes the fair values of the assets acquired and liabilities assumed from Inkfrog: (in thousands) Trade receivables $ 226 Prepaid expenses and other current assets 361 Intangible assets 2,016 Goodwill 4,936 Total Assets $ 7,539 Current liabilities 461 Deferred tax liability 452 913 Total Liabilities $ 913 Total purchase price allocation, net of cash acquired $ 6,626 Goodwill generated from this business combination is attributed to synergies between the Company's and Inkfrog respective products and services. The goodwill is not deductible for income tax purposes. The results of Inkfrog operations have been included in the consolidated financial statements since February 19, 2020. Pro forma results of operations related to this acquisition have not been prepared because they are not material to the Company's consolidated statement of income. Acquisition-related expenses for Inkfrog acquisition for the year ended December 31, 2020 were $4.2 million and included in operating expenses. This includes $0.2 million for professional consulting. The following table provides details regarding the identifiable assets acquired as of the date of the acquisition: Fair value Weighted Average Useful Life (in thousands) (in years) Technology 1,338 8 Customer relations 387 7 Distribution agreement 291 1.5 Total purchased intangible assets $ 2,016 F - 32 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) |
INTANGIBLE ASSETS, NET
INTANGIBLE ASSETS, NET | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS, NET | NOTE 7:- INTANGIBLE ASSETS, NET December 31, 2020 2019 Cost: Technology $ 9,614 $ 8,275 Customer relations 11,054 10,667 Customer data 12,043 12,043 Domain 552 552 Distribution agreement 291 - 33,554 31,537 Less - accumulated amortization 14,273 11,696 Intangible assets, net $ 19,281 $ 19,841 Estimated amortization expense for the years ended: 2021 $ 2,278 2022 2,087 2023 1,790 2024 1,732 Thereafter 11,394 $ 19,281 Amortization expense amounted to $2,784, $4,588 and $2,577 for the years ended December 31, 2018, 2019 and 2020, respectively. During 2019, the Company recorded $1,206 amortization expenses that relate to DeviantArt’s technology, an intangible asset due to launching a new platform and terminating the old one. |
ACCRUED EXPENSES AND OTHER CURR
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Other Liabilities, Current [Abstract] | |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | NOTE 8:- ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES December 31, 2020 2019 Accrued expenses $ 40,649 $ 36,154 Government authorities 26,008 17,584 Hedging transaction liability 1,961 696 Uncertain tax positions 1,811 2,030 $ 70,429 $ 56,464 |
CONVERTIBLE NOTES
CONVERTIBLE NOTES | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
CONVERTIBLE NOTES | NOTE 9:- CONVERTIBLE NOTES 2025 Convertible notes In August of 2020, The Company issued $575,000 aggregate principal amount, 0% coupon rate, of Convertible Senior Notes due 2025 (the “2025 Convertible Notes”). The 2025 Convertible Notes mature on February 15, 2025 unless earlier repurchased or converted. Upon conversion, the Company will pay or deliver, as the case may be, cash, ordinary shares or a combination of cash and ordinary shares, at the Company’s election. The 2025 Convertible Notes are convertible at an initial conversion rate of 2.4813 Ordinary Shares per $1,000 principal amount of 2025 Convertible Notes (equivalent to an initial conversion price of approximately $403.01 per Ordinary Share). The conversion rate will be subject to adjustment under certain circumstances in accordance with the terms of the 2025 Indenture. In addition, following certain corporate events that occur prior to the maturity date, or following Company’s delivery of a notice of tax redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert his notes in connection with such a corporate event or notice of tax redemption, as the case may be. Conversion terms: Holders may convert their Convertible Notes at their option at any time prior to the close of business on the business day immediately preceding February 15, 2025 only under the following circumstances: a. During any calendar quarter commencing after December 31, 2020 (and only during such calendar quarter), if the F - 34 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (cont.) b. During the five business day period after any ten consecutive trading day period (the “measurement period”) in c. If the Company calls the Convertible Notes for a tax redemption, at any time prior to the close of business on the d. Upon the occurrence of specified corporate events. On or after February 15, 2025 until the close of business on the second scheduled trading day immediately preceding the maturity date, holders may convert their Convertible Notes at any time, regardless of the foregoing circumstances. During the year ended December 31, 2020, the conditions allowing holders of the 2025 Convertible Notes to convert were not met. The Notes are therefore not convertible as of December 31, 2020 and are classified as long-term liability. Holders of the 2025 Convertible Notes who convert their Notes in connection with certain corporate events that constitute a make-whole fundamental change (as defined in the 2025 Indenture) are, under certain circumstances, entitled to an increase in the conversion rate. Additionally, in the event of a corporate event that constitutes a fundamental change (as defined in the 2025 Indenture), holders of the 2025 Convertible Notes may require the Company to repurchase all or a portion of their Notes at a price equal to 100% of the principal amount of the 2025 Convertible Notes being repurchased, plus any accrued and unpaid interest. The Company may not redeem the Convertible Notes prior to August 21, 2023, except in the event of certain tax law changes. The Company may redeem for cash all or any portion of the 2025 Convertible Notes, at its option, on or after August 21, 2023, if the last reported sale price of its ordinary shares has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of the redemption at a redemption price equal to 100% of the principal amount of the 2025 Convertible Notes to be redeemed, plus accrued and unpaid special interest if any, to, but excluding, the redemption date Upon the occurrence of a fundamental change (as defined in the Indenture), holders may require the Company to repurchase for cash all or any portion of their Convertible Notes at a fundamental change repurchase price equal to 100% of the principal amount of the Convertible Notes to be repurchased, plus accrued and unpaid special interest, if any, to, but excluding, the fundamental change repurchase date. F - 35 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) In accounting for the issuance of the Convertible Notes, the Company separated the Convertible Notes into liability and equity components. The carrying amount of the equity component representing the conversion option was $116,521 and was determined by deducting the fair value of the liability component from the value of the 2025 Convertible Notes. The excess of the principal amount of the liability component over its carrying amount ("debt discount") is amortized to interest expense over the term of the 2025 Convertible Notes at an effective interest rate of 5.21% over the contractual terms of the Convertible Notes. Total initial issuance costs of $15,712 related to the 2025 Convertible Notes were allocated between liability and equity in the same proportion as the allocation of the total proceeds to the liability and equity components. Issuance costs attributable to the liability component were $12,528 and amortized to interest expense using the effective interest method over the contractual term. Issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. The Company initially recorded equity issuance costs of $3,184. The net carrying amount of the Notes were as follows (in thousands): Principal outstanding Unamortized debt discount Unamortized debt issuance costs Net carrying value December 31, 2020: Convertible Notes $ 575,000 $ (109,655 ) $ (11,766 ) $ 453,579 The net carrying amount of the equity component of the 2025 Convertible Notes were as follows (in thousands): Amount allocated to conversion option Less: allocated issuance costs Equity component, net December 31, 2020: Convertible notes $ 116,521 $ (3,184 ) $ 113,337 The Company recognized interest expense on the 2025 Convertible Notes as follows: Year ended December 31, 2020 Amortization of debt discount and issuance costs $ 7,629 F - 36 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) 2025 Capped Call Transactions In connection with the pricing of the 2025 Convertible Notes, the Company entered into capped call transactions (the “Capped Call Transactions”) with certain of the purchasers of the Convertible Notes. The 2025 Capped Calls are purchased call options that give the Company the option to purchase, subject to anti-dilution adjustments substantially identical to those in the 2025 Convertible Notes.. The 2025 Capped Calls will expire in 2025, if not exercised earlier. The 2025 Capped Calls are intended to offset potential dilution to the Company’s common shares and/or offset the potential cash payments that the Company could be required to make in excess of the principal amount upon any conversion of the 2025 Notes under certain circumstances described in the Capped Call Transactions. The 2025 Capped Calls are separate transactions and are not part of the terms of the 2025 Notes. As the Capped Call Transactions are considered indexed to the Company's stock and are considered equity classified, they are recorded in shareholders’ equity on the consolidated balance sheets. The Company paid an aggregate amount of $46,000 for the 2025 Capped Calls. The amount paid for the 2025 Capped Calls was recorded as a reduction to Additional paid-in capital in the consolidated balance sheets. 2023 Convertible notes In June and July of 2018, The Company issued $442,750 aggregate principal amount, 0% coupon rate, of Convertible Senior Notes due 2023 (the “2023 Convertible Notes”). Subject to satisfaction of certain conditions and during certain periods, as defined in the indenture governing the Convertible Notes, the holders will have the option to exchange the notes into cash or the Company ordinary shares, if any (subject to the Company right to pay cash in lieu of all or a portion of such shares). The conversion rate was initially 7.0113 Ordinary Shares per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $142.63 per Ordinary Share). The conversion rate will be subject to adjustment in some events, but will not be adjusted for any accrued and unpaid special interest, if any. In addition, following certain corporate events that occur prior to the maturity date, or following the Company’s delivery of a notice of tax redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert his or her Convertible Notes in connection with such a corporate event or notice of tax redemption, as the case may be. Conversion terms: Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding January 1, 2023 only under the following circumstances: F - 37 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) e. During any calendar quarter commencing after September 30, 2018 (and only during such calendar quarter), if the f. During the five business day period after any ten consecutive trading day period (the “measurement period”) in g. If the Company calls the notes for a tax redemption, at any time prior to the close of business on the second h. Upon the occurrence of specified corporate events. On or after January 1, 2023 until the close of business on the i. For at least 20 trading days during the period of 30 consecutive trading days ended June 30, 2020, the last reported In accounting for the issuance of the Convertible Notes, the Company separated the Convertible Notes into liability and equity components. The carrying amount of the equity component representing the conversion option was $105,375 and was determined by deducting the fair value of the liability component from the par value of the Convertible Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount ("debt discount") is amortized to interest expense over the term of the Convertible Notes at an effective interest rate of 6.20% over the contractual terms of the Convertible Notes. Debt issuance costs related to the 2023 Convertible Notes comprised of commissions and payable to third party consultants of $11,511 and third party costs of $1,090. The Company allocated the total amount incurred to the liability and equity components of the 2023 Convertible Notes based on their relative values. Issuance costs attributable to the liability component were $9,602 and will be amortized to interest expense using the effective interest method over the contractual term. Issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. The Company initially recorded equity issuance costs of $2,999. F - 38 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) The net carrying amount of the 2023 Convertible Notes were as follows (in thousands): Principal outstanding Unamortized debt discount Unamortized debt issuance costs Converted to shares Net carrying value December 31, 2020: Convertible Notes $ 442,750 $ (57,435 ) $ (4,275 ) $ (179 ) $ 380,861 Principal outstanding Unamortized debt discount Unamortized debt issuance costs Net carrying value December 31, 2019: Convertible Notes $ 442,750 $ (77,527 ) $ (6,508 ) $ 358,715 The net carrying amount of the equity component of the 2023 Convertible Notes were as follows (in thousands): Amount allocated to conversion option Less: allocated issuance costs Converted to shares Equity component, net December 31, 2020: Convertible notes $ 105,375 $ (2,999 ) $ 179 $ 102,555 The Company recognized interest expense on the 2023 Convertible Notes as follows: Year ended December 31, 2020 Amortization of debt discount and issuance costs $ 22,325 The effective interest rate of the liability component is 6.20% for the Convertible Notes. F - 39 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) Amount allocated to conversion option Less: allocated issuance costs and Capped call Equity component, net December 31, 2019: Convertible notes $ 105,375 $ (48,337 ) $ 57,038 The Company recognized interest expense on the Notes as follows (in thousands, except for percentages): Year ended December 31, 2019 Amortization of debt discount and issuance costs $ 20,938 The effective interest rate of the liability component is 6.20% for the Convertible Notes. 2023 Capped Call Transactions In connection with the pricing of the 2023 Convertible Notes, the Company entered into privately negotiated capped call transactions (the “Capped Call Transactions”) with certain of the purchasers of the 2023 Convertible Notes. The 2023 Capped Call Transactions cover, collectively, the number of company ordinary shares underlying the 2023 Convertible Notes, subject to anti-dilution adjustments substantially similar to those applicable to the 2023 Convertible Notes. The cost of the 2023 Capped Call Transactions was $45,338. The transaction is expected generally to reduce the potential dilution to the ordinary shares upon any conversion of the Convertible Notes and/or offset any cash payments we are required to make in excess of the principal amount upon conversion of the Convertible Notes under certain events described in the Capped Call Transactions. As the Capped Call Transactions are considered indexed to the Company's stock and are considered equity classified, they are recorded in shareholders’ equity on the consolidated balance sheet and are not accounted for as derivatives. The cost of the Capped Call Transactions was recorded as a reduction to additional paid-in capital. |
LEASE
LEASE | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
LEASE | NOTE 10:- LEASE The Company`s leases include offices for its facilities worldwide, as well as car leases, which are all classified as operating leases. Certain leases include renewal options that are under the Company`s sole discretion. The renewal options were included in the right of use (“ROU”) and liability calculation if it was reasonably certain that the Company will exercise the option. December 31 2020 2019 Lease cost: Fixed cost and variable payments that depend on an index or rate $ 21,104 $ 16,995 Short-term lease cost 1,854 1,031 Total operating lease cost $ 22,958 $ 18,026 December 31 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (19,061) $ (15,376) Weighted average remaining operating lease term 6.57 7.79 Weighted average discount rate operating lease 4.1 % 4.8 % F - 41 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 10:- LEASE (Cont.) Future minimum lease payments of the operating lease liabilities as of December 31, 2020 were as follows: Fiscal Years Ending December 31, Lease Commitments 2021 $ 23,186 2022 20,461 2023 14,786 2024 11,670 2025 10,315 After 2026 33,227 Total operating lease payments 113,645 Less: Imputed interest 17,122 Present value of lease liabilities $ 96,523 The Company sublease one of its partial real estate offices. Lease income relating to lease payments of operating leases was $506 and $658 for the years ended December 31, 2020 and 2019, respectively. As of December 31, 2020, the Company has an additional operating lease commitment of approximately $167,000 for a new offices in Israel, which has not yet commenced. The operating lease commitment will commence on June, 2022, and on June 2023. The initial term of the lease agreement is 10 years commencing on the transfer of possession, and with option to extend the lease for additional periods of up to 15 years, subject to the conditions of the lease agreement. |
COMMITMENTS AND CONTINGENT LIAB
COMMITMENTS AND CONTINGENT LIABILITIES | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENT LIABILITIES | NOTE 11:- COMMITMENTS AND CONTINGENT LIABILITIES a. Pledges: The Company has pledged bank deposits in the amount of $ 715, in connection with an office lease agreement and credit cards. b. Legal contingencies: The Company reviews the status of each legal matter it is involved in, from time to time, in the ordinary course of business and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount can be reasonably estimated, the Company accrues a liability for the estimated loss. These accruals are reviewed at least quarterly and adjusted to reflect the impact of negotiations, settlements, rulings, advice of legal counsel and other information and events pertaining to a particular matter. As of December 31, 2020, the Company is not involved in any claims or legal proceedings which require accrual of liability for the estimated loss. |
SHAREHOLDERS' EQUITY
SHAREHOLDERS' EQUITY | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
SHAREHOLDERS' EQUITY | NOTE 12:- SHAREHOLDERS' EQUITY a. Ordinary shares: The ordinary shares of the Company confer on the holders thereof voting rights, rights to receive dividends and rights to participate in distribution of assets upon liquidation. b. Share based payment: In April 2007, the Company's Board of Directors adopted an Employee Shares Incentive Plan (the "2007 Plan"). Under the 2007 Plan, options may be granted to employees, officers, non-employees consultants and directors of the Company and its Subsidiaries. The 2007 plan was terminated on October 15, 2013, although option awards outstanding as of that date will continue in full force in accordance with the terms under which they were granted. In October 2013, the Company's Board of Directors adopted a new Employee Shares Incentive Plan (the "2013 Plan"). The 2013 Plan provides for the grant of options, restricted shares, RSUs. Under the Plans, as of December 31, 2020, an aggregate of 1,819,295 shares were still available for future grant. Each option granted under the Plan expires no later than ten years from the date of grant. The vesting period of the options is generally four years, unless the Board of Directors or the Board's Compensation Committee determines otherwise. Any option which is forfeited or cancelled before expiration becomes available for future grants. F - 43 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) The total share-based compensation expense related to all of the Company's equity-based awards, which include options, RSUs and employee stock purchase rights issued pursuant to the Company's Employee Share Purchase Plan (“ESPP”) and recognized for the years ended December 31, 2018, 2019 and 2020 was comprised as follows: Year ended December 31, 2020 2019 2018 Cost of revenues $ 9,127 $ 5,854 $ 4,418 Research and development 76,882 56,161 39,417 Sales and marketing 22,845 18,458 9,770 General and administrative 38,458 28,864 18,725 Total share-based compensation expense $ 147,313 $ 109,337 $ 72,330 Total unrecognized compensation cost amounted to $352,079 as of December 31, 2020, and is expected to be recognized over a weighted average period of approximately 2.5 years. c. Options granted to employees: A summary of the activity in options granted to employees for the year ended December 31, 2020 is as follows: Number of options Weighted average exercise price Weighted Average remaining contractual term (in years) Aggregate intrinsic value Balance at December 31, 2019 7,438,119 $ 37.53 5.49 $ 631,994 Granted 715,247 $ 155.62 Exercised (3,493,875 ) $ 12.59 Forfeited (41,111 ) $ 80.18 Balance at December 31, 2020 4,618,380 $ 74.31 6.74 $ 812,500 Exercisable at December 31, 2020 2,844,347 $ 50.61 5.80 $ 567,048 Vested and expected to vest at December 31, 2020 4,530,353 $ 73.56 6.71 $ 800,307 F - 44 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) The Company estimates the fair value of stock options granted using the Black-Scholes-Merton option-pricing model, which requires a number of assumptions: the expected volatility is based upon actual historical stock price movements; the expected term of options granted is based upon historical experience and represents the period of time that options granted are expected to be outstanding; the risk-free interest rate is based on the yield from U.S. Federal Reserve zero-coupon bonds with an equivalent term; For restricted stock units the fair value is based on the closing market value of the underlying shares at the date of grant. The Company has historically not paid dividends and has no foreseeable plans to pay dividends and, therefore, uses an expected dividend yield of zero in the option pricing model. The following table set forth the parameters used in computation of the options compensation to employees for the years ended December 31, 2018, 2019 and 2020: Year ended December 31, 2020 2019 2018 Expected volatility 42.26%-49.24% 42.60%-45.24% 45.19%-46.64% Expected dividends 0% 0% 0% Expected term (in years) 4.84-4.99 4.94 -4.99 5.17 -7.53 Risk free rate 0.25%-1.40% 1.51%-2.47% 2.59%-3.03% The following table set forth the parameters used in computation of the employee stock purchase plan for the years ended December 31, 2018, 2019 and 2020: Year ended December 31, 2020 2019 2018 Expected volatility 34.52%-83.3% 31.88%-54.49% 39.9%-41.2% Expected dividends 0% 0% 0% Expected term (in years) 0.5 0.5 0.5 Risk free rate 0.13%-0.95% 1.89%-2.52% 1.85%-2.28% F - 45 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) A summary of options data for the years ended December 31, 2018, 2019 and 2020, is as follows: Year ended December 31, 2020 2019 2018 Weighted-average grant date fair value of options granted $ 68.91 $ 53.67 $ 34.93 Total intrinsic value of the options exercised $ 436,187 $ 128,003 $ 137,448 Total fair value of shares vested $ 40,367 $ 33,316 $ 27,629 The aggregate intrinsic value is calculated as the difference between the per-share exercise price and the deemed fair value of the Company's ordinary share for each share subject to an option multiplied by the number of shares subject to options at the date of exercise. The following tables summarize information about the Company's outstanding and exercisable options granted to employees as of December 31, 2020: Exercise price (range) Options outstanding as of December 31, 2020 Weighted average remaining contractual term Options exercisable as of December 31, 2020 Weighted average remaining contractual term (years) (years) 0-19.79 451,409 2.91 442,098 2.80 19.8-21.13 586,121 4.67 586,121 4.67 21.14-51.32 326,467 5.17 300,362 5.09 51.33-56.61 451,958 6.12 404,324 6.12 56.62-61.75 741,489 7.12 430,890 7.12 61.76-101.67 407,639 7.57 218,296 7.39 101.68-102.67 736,632 8.12 305,214 8.12 102.68-142.09 266,061 8.55 88,162 8.35 142.1-143.13 544,383 9.14 57,108 9.14 143.14-286.29 106,221 9.51 11,772 9.06 4,618,380 6.74 2,844,347 5.80 F - 46 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 12:- SHAREHOLDERS' EQUITY (Cont.) e. Options granted to non-employees consultants: The following table summarizes information about the Company's outstanding and exercisable options to purchase ordinary shares granted to non-employees consultants as of December 31, 2020: Grant Date Options outstanding as of December 31, 2020 Exercise price Exercisable as of December 31, 2020 Exercisable through $ January 9, 2013 3,400 2.34 3,400 January 9, 2023 No options were granted to non-employees during the years ended December 31, 2020, 2019 and 2018. f. A summary of RSU activity for the year ended December 31, 2020, is as follows: Number of shares Weighted average grant date fair value per share $ Unvested as of December 31, 2019 2,124,430 $ 98.50 Granted 1,054,030 $ 199.80 Vested (956,651 ) $ 93.16 Forfeited (143,382 ) $ 120.44 Unvested as of December 31, 2020 2,078,427 $ 150.87 |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 13:- INCOME TAXES The Company's subsidiaries are separately taxed under the domestic tax laws of the jurisdiction of incorporation of each entity. a. Corporate tax in Israel: In December 2016, the Israeli Parliament approved the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2017 and 2018 Budget Years), 2016 which reduces the corporate income tax rate to 24% (instead of 25%) effective from January 1, 2017 and to 23% effective from January 1, 2018. The Israeli corporate tax rate was 23% for the years ended December 31, 2020, 2019 and 2018. A company is taxable on its real capital gains at the corporate income tax rate in the year of sale. However, the effective tax rate payable by a company that qualifies as an Industrial Company that derives income from an Approved Enterprise, a Beneficiary Enterprise or a Preferred Enterprise (as discussed below) may be considerably less. Capital gains derived by an Israeli company are subject to the prevailing corporate tax rate. b. Loss before taxes on income is comprised as follows: Year ended December 31, 2020 2019 2018 Domestic $ (151,460 ) $ (85,369 ) $ (50,679 ) Foreign 1,295 1,553 16,766 Loss before taxes on income $ (150,165 ) $ (83,816 ) $ (33,913 ) F - 48 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) c. Deferred income taxes: Deferred taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts recorded for tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss carryforward $ 30,481 $ 19,362 Capital losses carry-forwards 1 54 Operating lease liabilities 16,495 15,197 Research and development expenses carryforward 1,742 2,093 Share-based compensation 18,242 12,955 Depreciation differences 582 1,082 Accrued employees costs 3,506 1,774 Intra-entity intellectual property transfer(1) - 1,835 Intangible assets 358 - Tax advances 4,032 3,353 Other 139 189 Deferred tax assets 75,578 57,894 Deferred tax liabilities: Convertible notes $ 19,415 $ 8,990 Other financial income 15,343 - Property and equipment 1,740 299 Operating lease ROU assets 14,999 14,401 Acquired Intangible assets 1,880 1,831 Share-based compensation - - Other 1,574 209 Deferred tax liabilities $ 54,951 $ 25,730 Valuation allowance (6,797 ) (30,470 ) Deferred taxes are included in the consolidated balance sheets, as follows: Long-term receivables $ 1,813 $ 14,730 Long-term liabilities $ 15,643 $ 13,036 F - 49 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) (1) During 2019, the Company completed an intra-entity transfer from US to Israel of certain intangible property The Company has provided valuation allowances in respect of all deferred tax assets resulting from tax loss carry-forwards and other reserves and allowances due to its history of losses and uncertainty concerning realization of these deferred tax assets. In addition, a deferred tax liability has been established to reflect the Company's tax depreciation of property and equipment, net which differs from depreciation recorded in the consolidated financial statements and purchased technology as part of business combination. d. Income taxes are comprised as follows: Year ended December 31, 2020 2019 2018 Current $ (535 ) $ 3,309 $ 4,188 Deferred 15,524 (711 ) (981 ) $ 14,989 $ 2,598 $ 3,207 Domestic $ 16,193 $ (1,981 ) $ 1,140 Foreign (1,205 ) 4,579 2,067 $ 14,989 $ 2,598 $ 3,207 e. A reconciliation of the Company's theoretical income tax expense to actual income tax expense as follows: Year ended December 31, 2020 2019 2018 Loss before taxes on income $ (150,165 ) $ (83,816 ) $ (33,913 ) Statutory tax rate 23 % 23 % 23 % Theoretical income tax expense (34,538 ) (19,278 ) (7,800 ) Deferred tax assets for which valuation allowance was provided 29,485 8,749 (1,925 ) Non-deductible option expenses (5,529 ) (443 ) 12,609 Non-deductible expenses 627 2,280 824 Tax adjustment in respect of different tax rate of foreign subsidiary 345 (249 ) (1,627 ) Preferred enterprise benefits 23,700 9,732 - Rate change impact (57 ) (93 ) (174 ) Intra-entity intellectual property transfer - 196 - Different tax rate 372 463 - Foreign tax - 102 1,182 Other 584 1,139 118 Income tax expense $ 14,989 $ 2,598 $ 3,207 F - 50 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) f. Net operating loss carryforward: As of December 31, 2020, the Company had carryforward operating and capital tax losses totaling approximately $248,203 and $5, respectively. $208,146 and $5 attributed to Israel that can be carried forward indefinitely. g. The Law for the Encouragement of Capital Investments, 1959 (the "Law"): On April 1, 2005, an amendment to the Investment Law came into effect (the "Amendment") and has significantly changed the provisions of the Investment Law. The Amendment limits the scope of enterprises which may be approved by the Investment Center by setting criteria for the approval of a facility as an Approved Enterprise, such as provisions generally requiring that at least 25% of the Approved Enterprise's income will be derived from export. Additionally, the Amendment enacted major changes in the manner in which tax benefits are awarded under the Investment Law so that companies no longer require Investment Center approval in order to qualify for tax benefits. According to the law, the Company is entitled to various tax benefits by virtue of the "Beneficiary Enterprise" status granted to part of its enterprises, defined by this law. During 2010, the Company had applied by Tax Pre-ruling to the Israeli Tax Authorities ("ITA") to receive "Beneficiary Enterprise" status and elect 2009 as year of election. During 2011, the Company received a tax decision from the ITA that approves its request for "Beneficiary Enterprise" status and the Company elect 2009 as its year of election. In addition, during 2013, the Company had submitted a notification to the Israeli Tax Authorities ("ITA") and elect 2012 as year of election. Under the Investment Law and its Amendment and according to the tax decision, the Company is entitled to various tax benefits, defined by this law, under the "Alternative Benefits" track as a Beneficiary Enterprise. Pursuant to the beneficiary program, the Company is entitled to a tax benefit period of seven to ten years on income derived from this program as follows: the Company is fully tax exempted for a period of the first two years and for the remaining five to eight subsequent years is subject to tax at a rate of 10% - 25% (based on the percentage of foreign ownership of the Company). The duration of tax benefits is subject to a limitation of the earlier of 7 years from the Commencement Year, or 12 years from the first day of the Year of Election. If dividends are distributed out of tax exempt profits, the Company will then become liable for tax at the rate applicable to its profits from the Beneficiary enterprise in the year in which the income was earned, as if it had not chosen the alternative track of benefits. F - 51 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) The dividend recipient is subject to withholding tax at the rate of 15% applicable to dividends from Beneficiary enterprises, if the dividend is distributed during the tax benefits period or within twelve years thereafter. This limitation does not apply to a foreign investors' company. The Company currently has no plans to distribute dividends and intends to retain future earnings to finance the development of its business. The above benefits are conditioned upon the fulfilment of the conditions stipulated by the law and regulations published thereunder. In the event of failure to comply with these conditions, the benefits may be cancelled and the Company may be required to refund the amount of the benefits, in whole or in part, including interest and linked to changes in the Israeli CPI. Management believes that the Company will meet the aforementioned conditions by the year of the elected operations. As a result of the amendment, tax-exempt income generated under the provisions of the amendment will subject the Company to taxes upon distribution or liquidation and the Company may be required to record a deferred tax liability with respect to such tax-exempt income. Through December 31, 2020 the Company had not generated income under the provision of the new law. In December 2010, the Israeli Parliament passed the Law for Economic Policy for 2011 and 2012 (Amended Legislation), 2011, which prescribes, among other things, amendments to the Investment Law, effective as of January 1, 2011(the 2011 Amendment). The 2011 Amendment canceled the availability of the benefits granted to companies under the Investment Law prior to 2011 and, instead, introduced new benefits for income generated by a “Preferred Company” through its “Preferred Enterprise” (as such terms are defined in the Investment Law) as of January 1, 2011. Similar to a “Beneficiary Company,” a Preferred Company is an industrial company owning a Preferred Enterprise which meets certain conditions (including a minimum threshold of 25% export). However, under this new legislation the requirement for a minimum investment in productive assets was cancelled. Pursuant to the 2011 Amendment, a Preferred Company is entitled to a reduced corporate tax rate of 16% and 9% in 2014 and thereafter. Dividends paid out of income attributed to a Preferred Enterprise during 2014 and thereafter are generally subject to withholding tax at the rate of 20% or such lower rate as may be provided in an applicable tax treaty. However, if such dividends are paid to an Israeli company, no tax is required to be withheld (however, if afterward distributed to individuals or non-Israeli company a withholding of 20% or such lower rate as may be provided in an applicable tax treaty, will apply). F - 52 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) The 2011 Amendment also provided transitional provisions to address companies already enjoying existing tax benefits under the Investment Law. These transitional provisions provide, among other things, that unless an irrevocable request is made to apply the provisions of the Investment Law as amended in 2011 with respect to income to be derived as of January 1, 2011: (i) the terms and benefits included in any certificate of approval that was granted to an Approved Enterprise which chose to receive grants and certain tax benefits under the Grant Track before the 2011 Amendment became effective will remain subject to the provisions of the Investment Law as in effect on the date of such approval, and subject to certain conditions; and (ii) terms and benefits included in any certificate of approval that was granted to an Approved Enterprise under the Alternative Track before the 2011 Amendment became effective will remain subject to the provisions of the Investment Law as in effect on the date of such approval, provided that certain conditions are met; and (iii) a Beneficiary Enterprise can elect to continue to benefit from the benefits provided to it before the 2011 Amendment came into effect, provided that certain conditions are met. In December 2016, the Economic Efficiency Law (Legislative Amendments for Applying the Economic Policy for the 2018 and 2019 Budget Years), 2016 which includes Amendment 73 to the Law ("Amendment 73") was published. According to Amendment 73, a preferred enterprise located in development area A will be subject to a tax rate of 7.5% instead of 9% effective from January 1, 2017 and thereafter (the tax rate applicable to preferred enterprises located in other areas remains at 16%). The new tax tracks under the Amendment are as follows: Technological preferred enterprise - an enterprise for which total consolidated revenues of its parent company and all subsidiaries are less than NIS 10 billion. A technological preferred enterprise, as defined in the Law, which is located in the center of Israel will be subject to tax at a rate of 12% on profits deriving from intellectual property (in development area A - a tax rate of 7.5%). The Amendment also prescribes special tax tracks for technological enterprises, which are subject to regulations that were published by the Minister of Finance on May 1, 2017. Under the transition provisions of the new legislation, the Company may decide to irrevocably implement the new law while waiving benefits provided under the current law or to remain subject to the current law. The Company evaluated the effect of the adoption of the Amendment 73 on its financial statements and determined to remain with the Beneficiary Enterprise Status". F - 53 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) h. Tax benefits for research and development: Israeli tax law (section 20a to the Israeli Tax Ordinance) allows, under certain conditions, a tax deduction for research and development expenses, including capital expenses, for the year in which they are paid. Such expenses must relate to scientific research in industry, agriculture, transportation, or energy, and must be approved by the relevant Israeli government ministry, determined by the field of research. Furthermore, the research and development must be for the promotion of the company's business and carried out by or on behalf of the company seeking such tax deduction. However, the amount of such deductible expenses is reduced by the sum of any funds received through government grants for the finance of such scientific research and development projects. As for expenses incurred in scientific research that is not approved by the relevant Israeli government ministry, they will be deductible over a three-year period starting from the tax year in which they are paid. The Company believes that it is eligible for the above mentioned benefit for the majority of its research and development expenses. i. Tax reform in the U.S.: The Tax Cuts and Jobs Act (the “Act”) was enacted on December 22, 2017. The Act reduces the US federal corporate tax rate from 35% to 21% in 2018, repealed the corporate alternative minimum tax, and requires companies to pay a one-time transition tax on earnings of certain foreign subsidiaries that were previously tax deferred and creates new taxes on certain foreign-sourced earnings. The Company calculate an effective rate by computing the effective state tax rate and adding the expected federal statutory rate with a reduction for the federal benefit of the state tax expense. The Company remeasured all U.S. deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future, which is generally 22%. j. Tax assessments: The Company’s has final tax assessments through the tax year 2015. F - 54 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) k. Uncertain tax positions: A reconciliation of the opening and closing amounts of total unrecognized tax benefits is as follows: Year ended December 31, 2020 2019 2018 Opening balance $ 2,030 $ 334 $ 1,378 Increases (decrease) related to previous and current year tax positions (219 ) 1,696 (1,044 ) Closing balance $ 1,811 $ 2,030 $ 334 |
FINANCIAL INCOME, NET
FINANCIAL INCOME, NET | 12 Months Ended |
Dec. 31, 2020 | |
Nonoperating Income (Expense) [Abstract] | |
FINANCIAL INCOME, NET | NOTE 14:- FINANCIAL INCOME, NET Year ended December 31, 2020 2019 2018 Bank charges $ (539 ) $ (533 ) $ (310 ) Income (expenses) related to hedging activity (5,529 ) 963 1,435 Amortization of debt discount and issuance costs (29,954 ) (20,938 ) (10,004 ) Exchange rate loss (2,352 ) (2,905 ) (3,522 ) Other financial income(1) 69,042 - - Total expenses 30,668 (23,413 ) (12,401 ) Interest income 16,391 19,792 9,607 Total financial income (expenses), net $ 47,059 $ (3,621 ) $ (2,794 ) (1) This includes $66,709 of appreciation of valuation related to holdings in a privately held company, which the Company has held since 2012. |
BASIC AND DILUTED NET LOSS PER
BASIC AND DILUTED NET LOSS PER SHARE | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
BASIC AND DILUTED NET LOSS PER SHARE | NOTE 15:- BASIC AND DILUTED NET LOSS PER SHARE Year ended December 31, 2020 2019 2018 Net loss available to shareholders of ordinary shares $ (165,154 ) $ (86,414 ) $ (37,120 ) Denominator: Shares used in computing net loss per ordinary shares, basic and diluted 54,425,056 50,504,698 48,017,188 The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding. Year ended December 31, 2020 2019 2018 Shares used in computing net loss per ordinary shares, basic and diluted 54,425,056 50,504,698 48,017,188 The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: Stock options 4,621,780 7,447,519 7,676,713 Restricted share units 2,078,427 2,125,440 2,090,512 Convertible Notes 4,428,999 3,104,251 3,104,251 11,129,206 12,677,210 12,871,476 |
SEGMENTS, CUSTOMERS AND GEOGRAP
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION | NOTE 16:- SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION a. The Company applies ASC topic 280, "Segment Reporting", ("ASC No. 280"). The Company operates in one b. The following tables present total revenues for the years ended December 31, 2018, 2019 and 2020 and long-lived Revenues: Year ended December 31, 2020 2019 2018 North America (*) $ 563,824 $ 414,775 $ 316,446 Europe 251,597 195,324 159,768 Latin America 51,053 51,108 46,232 Asia and others 122,286 99,881 81,258 $ 988,760 $ 761,088 $ 603,704 (*) Include revenue from USA in amount of $278,784, $363,431 and $481,098 for 2018, 2019 and 2020, respectively. Long-lived assets and ROU: December 31, 2020 2019 Israel $ 56,684 $ 40,147 Europe and Asia 15,233 13,609 America 52,352 57,200 $ 124,268 $ 110,955 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2020 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17:- SUBSEQUENT EVENTS In March 2021, the Company acquired all outstanding shares of Miami-based restaurant ordering technology provider SpeedETab. The acquisition would be accounted for as a business combination. |
SIGNIFICANT ACCOUNTING POLICI_2
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Use of estimates: | a. Use of estimates: The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. The accounting estimates that require management’s subjective judgments include, but are not limited to, revenue recognition, income taxes, share-based compensation and purchase price allocation on acquisitions including determination of useful lives, Incremental Borrowing Rate (“IBR”), convertible notes borrowing rate and contingent consideration. The Company evaluates its estimates and judgments on an ongoing basis and revises them when necessary. Actual results may differ from the original or revised estimates. The novel coronavirus (“COVID-19”) pandemic has created, and may continue to create, significant uncertainty in macroeconomic conditions. The Company considered the impact of COVID-19 on the estimates and assumptions and determined that there were no material adverse impacts on the consolidated financial statements for the period ended December 31, 2020. As events continue to evolve and additional information becomes available, the Company’s estimates and assumptions may change materially in future periods. |
Principles of consolidation: | b. Principles of consolidation: The consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. Intercompany transactions and balances, have been eliminated upon consolidation. |
Financial statements in U.S. dollars: | c. Financial statements in U.S. dollars: A substantial portion of the Company's financing activities, including equity transactions, cash investments, costs and revenues are generated in U.S. dollars. The Company's management believes that the U.S. dollar is the currency of the primary economic environment in which the Company operates. Thus, the functional and reporting currency of the Company is the U.S. dollar. The Company's subsidiaries’ functional currency is the currency of the primary economic environment in which the subsidiary operates; normally, that is the currency of the environment in which a subsidiary primarily generates and expends cash. In making the determination of the appropriate functional currency for the subsidiaries, the Company considers cash flow indicators, local market indicators, financing indicators and the subsidiary’s relationship with both the parent company and other subsidiaries. For subsidiaries that are primarily a direct and integral component or extension of the parent entity’s operations, the U.S. dollar is the functional currency. F - 11 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Accordingly, monetary accounts maintained in currencies other than the U.S. dollar are remeasured into U.S. dollars in accordance with Statement of the Accounting Standard Codification ("ASC") No. 830 "Foreign Currency Matters" ("ASC No. 830"). All transaction gains and losses of the remeasured monetary balance sheet items are reflected in the statement of comprehensive loss as financial income or expenses, as appropriate. |
Cash and cash equivalents: | d. Cash and cash equivalents: Cash equivalents are short-term highly liquid investments that are readily convertible to cash with original maturities of three months or less, at the date acquired. |
Short-term deposits: | e. Short-term deposits: Short-term deposits are deposits with maturities over three months from the date of purchase and of up to one year. As of December 31, 2019 and 2020, the Company's bank deposits were denominated in U.S. dollars and New Israel Shekels (NIS) and bore interest at weighted average interest rates of 2.86% and 1.21%, respectively. Short-term deposits are presented at their cost, including accrued interest. |
Restricted deposits: | f. Restricted deposits: Restricted deposits are deposits with maturities of up to one year and are used as security for the rental of premises and for the Company's credit cards. As of December 31, 2019 and 2020, the Company's bank deposits were in U.S. dollars and bore interest at weighted average interest rates of 0.05% and 0.038%, respectively. Restricted deposits are presented at their cost, including accrued interest upon the term of the remaining restrictions. |
Marketable securities: | g. Marketable securities: The Company’s marketable securities consist of U.S. federal deposit insured corporation, Treasury bonds, certificate of deposits, sovereign bonds, municipal bonds and corporate bonds. The Company accounts for investments in debt securities in accordance with ASC No. 320, "Investments - Debt and Equity Securities". Management determines the appropriate classification of its investments in debt securities at the time of purchase and re-evaluates such determinations at each balance sheet date. Marketable securities are classified as available for sale at the time of purchase. Available-for-sale securities are carried at fair value based on quoted market prices, with the unrealized gains and losses, reported in accumulated other comprehensive income (loss) in shareholders’ equity. Realized gains and losses on sale of investments are included in financial income, net and are derived using the specific identification method for determining the cost of securities sold. Interest on these securities, as well as amortization or accretion of premiums or discounts, are included in financial income, net. F - 12 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company classifies its marketable securities as either short-term or long-term based on each instruments’ underlying contractual maturity date as well as the intended time of realization. Marketable securities with maturities of 12 months or less are classified as short-term, and marketable securities with maturities greater than 12 months are classified as long-term. In 2020 the Company adopted ASU 2016-13, Topic 326 “Financial Instruments – Credit Losses: Measurement of Credit Losses on Financial Instruments” which modified the other than temporary impairment model for available for sale debt securities. The guidance requires the Company to determine whether a decline in fair value below the amortized cost basis of an available for sale debt security is due to credit related factors or noncredit related factors. A credit related impairment should be recognized as an allowance on the balance sheet with a corresponding adjustment to earnings, however, if the Company intends to sell an impaired available for sale debt security or more likely than not would be required to sell such a security before recovering its amortized cost basis, the entire impairment amount would be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. The Company did not recognize an allowance for credit losses on marketable securities as the expected losses were not material for the year ended December 31, 2020. No other than temporary impairment losses were recorded for the years ended December 31, 2019 and 2018. |
Property and equipment, net: | h. Property and equipment, net: Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and electronic equipment 15 – 33 (mainly 33) Internal use software 33 Office furniture and equipment 6 – 14 (mainly 6) Vehicles 15 Leasehold improvements Over the shorter of the related lease period or the life of the asset |
Impairment of Long-lived assets and intangible assets subject to amortization: | i. Impairment of Long-lived assets and intangible assets subject to amortization: The long-lived assets of the Company are reviewed for impairment in accordance with ASC No. 360, "Property, Plant and Equipment" ("ASC No. 360"), whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted cash flows expected to be generated by the assets. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the fair value of the assets. During the years ended December 31, 2018, 2019 and 2020, no impairment losses have been identified. |
Business combinations: | j. Business combinations: The Company accounted for business combination in accordance with ASC No. 805, "Business Combinations". ASC No. 805 requires recognition of assets acquired, liabilities assumed, and any non-controlling interest at the acquisition date, measured at their fair values as of that date. Any excess of the fair value of net assets acquired over purchase price is allocated to goodwill and any subsequent changes in estimated contingencies are to be recorded in earnings. In addition, changes in valuation allowance related to acquired deferred tax assets and in acquired income tax position are to be recognized in earnings. The Company accounts for a transaction that does not meet the definition of a business as an asset acquisition Under ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business (“2017-01”), the Company first determines whether substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets. If this threshold is met, the single asset or group of assets, as applicable, is not a business. Acquisition-related expenses are recognized separately from the business combination and are expensed as incurred. |
Goodwill and intangible assets: | k. Goodwill and intangible assets: Goodwill and certain other purchased intangible assets have been recorded in the Company's financial statements as a result of acquisitions. Goodwill represents excess of the costs over the net tangible and intangible assets acquired of businesses acquired Under ASC No. 350, "Intangible - Goodwill and other", ("ASC No. 350") goodwill is not amortized, but rather is subject to impairment test. In addition, the costs of intangible assets that were purchased from others for use in research and development activities were recorded as assets to the extent that they have alternative future use. ASC No. 350 allows an entity to first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test. If the qualitative assessment does not result in a more likely than not indication of impairment, no further impairment testing is required. If it does result in a more likely than not indication of impairment, quantitative test is performed. F - 14 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Alternatively, ASC No. 350 permits an entity to bypass the qualitative assessment for any reporting unit and proceed directly to performing the quantitative goodwill impairment test. The Company operates in one reporting segment, and this segment comprises its only reporting unit. Therefore, goodwill is tested for impairment by comparing the fair value of the reporting unit with its carrying value. The Company elects to perform an annual impairment test of goodwill as of October 1 of each year, or more frequently if impairment indicators are present. Intangible assets that are considered to have definite useful life are amortized using the straight-line basis over their estimated useful lives, which weighted average amortization period of 13 years. The carrying amount of these assets is reviewed whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. Recoverability of these assets is measured by comparison of the carrying amount of the asset to the future undiscounted cash flows the asset is expected to generate. If the asset is considered to be impaired, the amount of any impairment is measured as the difference between the carrying value and the fair value of the impaired asset. As of December 31, 2018, 2019 and 2020, no impairment losses have been recognized. |
Equity investments in privately-held companies: | l. Investments in privately held companies: The Company's non-marketable equity securities are investments in privately held companies without readily determinable market values. Effective January 1, 2018, the Company adopted Accounting Standards Update (“ASU”) 2016-01, which changed the way it accounts for non-marketable securities on a prospective basis. The Company's equity investments are investments in equity securities of privately held companies without readily determinable market values. The Company elected to account for its equity investments using the measurement alternative, which is cost, less any impairment, adjusted for changes in fair value resulting from observable transactions for identical or similar investments of the same issuer. The investments are reviewed periodically to determine if their respective values have appreciated or have been impaired, and adjustments are recorded as necessary. During the year ended December 31, 2020, the Company recorded an income in amount of $67,084 related to revaluation of its investments in privately held companies based on observable price changes. This includes $66,709 of appreciation of valuation related to holdings in a privately held company, which the Company has held since 2012. |
Derivatives instruments: | m. Derivatives instruments: ASC No. 815, "Derivative and Hedging" ("ASC No. 815"), requires companies to recognize all of their derivative instruments as either assets or liabilities in the statement of balance sheets at fair value. For those derivative instruments that are designated and qualify as hedging instruments, a company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. Derivative instruments designated as hedging instruments: In August 2017, the FASB issued ASU 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,” amending the eligibility criteria for hedged items and transactions to expand an entity’s ability to hedge nonfinancial and financial risk components. The new guidance eliminates the requirement to separately measure and present hedge ineffectiveness and aligns the presentation of hedge gains and losses with the underlying hedge item. The new guidance also simplifies the hedge documentation and hedge effectiveness assessment requirements. The amended presentation and disclosure requirements must be adopted on a prospective basis, while any amendments to cash flow and net investment hedge relationships that exist on the date of adoption must be applied on a “modified retrospective” basis, meaning a cumulative effect adjustment to the opening balance of retained earnings as of the beginning of the year of adoption. The new guidance was effective on January 1, 2019, and the adoption did not have a material impact on our consolidated financial statements. The net fair value of derivative instruments balance as of December 31, 2019 and 2020, totaled $888 and $6,841, respectively and is presented as prepaid expenses and other current assets. In the years ended December 31, 2018, 2019 and 2020, the Company recorded as operating income (expenses) net from hedging transactions in the amount of $(1,687), $147, and $1,582, respectively. To hedge against the risk of overall changes in cash flows resulting from foreign currency salary payments, rent and other overhead vendors during the year, the Company has instituted a foreign currency cash flow hedging program. The Company hedges portions of its forecasted salary, rent and other overhead cash flow denominated in NIS. Options and forward contracts are designated as cash flow hedges, as defined by ASC No. 815, and are all effective. As of December 31, 2020, the gross amount recorded in accumulated other comprehensive income from the Company's currency option transactions is $6,841. At December 31, 2020, the notional amounts of foreign exchange forward and options contracts into which the Company entered were $45,000. The foreign exchange forward and options contracts will expire throughout 2021. F - 16 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Derivative instruments not designated as hedging instruments: In addition to the derivatives that are designated as hedges as discussed above, the Company enters into certain foreign exchange forward and option transactions to economically hedge certain revenue transactions in Euros, British pounds, Brazilian Real, Mexican Pesos and Japanese Yen and expenses in NIS. Gains and losses related to such derivative instruments are recorded in financial expenses, net. At December 31, 2020, the notional amounts of foreign exchange forward and options contracts into which the Company entered were $111,372. The foreign exchange forward and option transactions will expire through 2021. The net fair value of derivative instruments balance as of December 31, 2019 and 2020, totaled $(119) and $(1,719), respectively, and is presented as accrued expenses and other current liabilities. In the years ended December 31, 2018, 2019 and 2020, the Company recorded financial income (expenses), net from hedging transactions in the amount of $1,435, $963, and $(5,529) respectively. |
Severance pay: | n. Severance pay: The Israeli Severance Pay Law, 1963 ("Severance Pay Law"), specifies that employees are entitled to severance payment, following the termination of their employment. Under the Severance Pay Law, the severance payment is calculated as one month salary for each year of employment, or a portion thereof. The majority of the Company's liability for severance pay is covered by the provisions of Section 14 of the Severance Pay Law ("Section 14"). Under Section 14 employees are entitled to monthly deposits, at a rate of 8.33% of their monthly salary, continued on their behalf to their insurance funds. Payments in accordance with Section 14 release the Company from any future severance payments in respect of those employees. As a result, the Company does not recognize any liability for severance pay due to these employees and the deposits under Section 14 are not recorded as an asset in the Company's balance sheet. Severance expense for the years ended December 31, 2018, 2019 and 2020, amounted to $9,489, $12,042 and $15,737, respectively. |
U.S. employees defined contribution plan: | o. U.S. employees defined contribution plan: The U.S. Subsidiary has a 401(k) defined contribution plan covering certain employees in the U.S. All eligible employees may elect to contribute up to 100%, but generally not greater than $19 per year (for certain employees over 50 years of age the maximum contribution is $25 per year), of their annual compensation to the plan through salary deferrals, subject to Internal Revenue Service limits. F - 17 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The U.S. Subsidiary matches 4% of employee contributions up to the plan with no limitation. During the years ended December 31, 2018, 2019 and 2020, the U.S. Subsidiary recorded expenses for matching contributions in amounts of $587, $727, and $1,117, respectively. |
Convertible senior notes: | p. Convertible senior notes: The Company accounts for the issuance of convertible senior notes in accordance with FASB ASC Subtopic 470-20, Debt with Conversion and Other Options. Pursuant to ASC Subtopic 470-20, as the Notes have a net settlement feature and may be settled wholly or partially in cash upon conversion, the Company is required to separately account for the liability (debt) and equity (conversion option) components of the instrument. The carrying amount of the liability component is computed by estimating the fair value of a similar liability without the conversion option. The amount of the equity component is then calculated by deducting the fair value of the liability component from the principal amount of the instrument. This difference represents a debt discount that is amortized to interest expense over the respective terms of the Notes using an effective interest rate method. In accounting for the issuance costs related to the Notes, the allocation of issuance costs incurred between the liability and equity components were based on their relative values. |
Revenue recognition: | q. Revenue recognition: The Company recognized revenue in accordance with Topic 606 when, or as, control of the promised goods or services is transferred to the customer, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. Revenue is recognized net of allowances for refunds and any taxes collected from customers, which are subsequently remitted to governmental authorities. The Company applies the following five steps: (1) identify the contract with a customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when a performance obligation is satisfied. The Company offers a 14-day money back guaranty ("Guaranty Period") on new premium subscription. The Company considers such amount collected from new premium subscriptions as customer deposits until the end of the 14-day trial period. Revenues are recognized once the Guaranty Period has expired. The Company's revenue is categorized and disaggregated as reflected in the statements of operations, as follows: F - 18 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) Creative Subscriptions Revenues from premium subscriptions are recognized on a straight-line basis over the contract period, since the customer simultaneously receives and consumes the benefits provided by the Company's performance as the Company performs. Revenues related to the purchase and registration of domain names are recognized at the full amount paid by the customer at a point in time upon the purchase and registration of the domain name, since that is when the Company satisfies the performance obligation. Business Solutions Revenues related to Google's G-Suite application is recognized at a point in time upon the purchase, since that is when the Company satisfies the performance obligation. Other subscriptions and software applications developed by the Company are recognized on a straight-line basis over the contract period, since the customer simultaneously receives and consumes the benefits provided by our performance as the Company performs. Revenues related to third-party software applications are recognized on a net basis at a point in time upon purchase of the application, since that is when the Company completes its obligation to facilitate the transfer between the customer and the third-party developer. Revenue related to the sale of online advertising inventory (ad space) and other related advertising services to brands and advertising agencies are recognized at a point in time, when an ad space is sold. Revenues related to Payments by Wix 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. In cases where the Company conclude that it is not the primary obligor, the Comapny recognizes revenue from revenue share arrangements on net basis. Each of our goods and services is sold separately, therefore standalone selling prices (SSP) for each of them is observed, and allocation of the transaction price between the performance obligations in the contract is made relatively on that basis. Refunds are estimated at contract inception and updated at the end of each reporting period if additional information becomes available. Principal versus Agent Considerations The Company sells its products directly to customers and also through a network of resellers. In certain cases, the Company acts as a reseller of products provided by others. The determination of gross or net revenue recognition is reviewed on a product-by-product basis and is dependent on the Company's determination as to whether it acts as principal or agent in the transaction. Revenue associated with sales through the Company's network of resellers, for certain domain sales, for third-party offerings including Google's G-Suite application and fees related to Payments by Wix is recorded on a gross basis as the Company has determined that the Company controls the product before transferring it to the end customers, responsible for fulfilling the promise to provide the service and act as primary obligor. Revenues related to third-party software applications when the Company does not control the product or service before transferring to the customers are recognized on a net basis. F - 19 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company uses the practical expedient and does not assess the existence of a significant financing component when the difference between payment and revenue recognition is a year or less. |
Research and development costs: | r. Research and development costs: Research and development costs are charged to the statements of comprehensive loss as incurred. |
Internal use software costs: | s. Internal use software costs: The Company capitalized costs related to the online platform for internal use incurred during the application development stage. Costs incurred in the process of software production are charged to expenses as incurred. Certain software development costs are capitalized under ASC 350-40, Internal-Use Software and are included in property and equipment, net in the consolidated balance sheets. Capitalization of such costs begins when the preliminary project stage is complete and ceases at the point in which the project is substantially complete and is ready for its intended purpose. During 2018, 2019 and 2020, the Company capitalized $392, $778 and $575, respectively. |
Advertising expenses: | t. Advertising expenses: Advertising expenses consist primarily of cost-per click expenses, social networking expenses, marketing campaigns and display advertisements. Advertising expenses are charged to the statement of comprehensive loss, as incurred. Advertising expenses for the years ended December 31, 2018, 2019 and 2020 amounted to $165,319, $187,318 and $282,804, respectively. |
Share-based compensation: | u. Share-based compensation: The Company accounts for share-based compensation in accordance with ASC 718, "Compensation - Stock Compensation" ("ASC No. 718"). ASC No. 718 requires companies to estimate the fair value of equity-based payment awards on the date of grant using an option-pricing model. The value of the portion of the award that is ultimately expected to vest is recognized as an expense over the requisite service periods in the Company's consolidated statements of comprehensive loss. F - 20 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) The Company recognizes compensation expenses for the value of its awards granted based on the straight-line method over the requisite service period of each of the awards, net of estimated forfeitures. The Company estimates forfeitures at the grant date, and revises its estimate if necessary, in subsequent periods if actual forfeitures differ from those estimates. Some of the options granted are subject to certain performance criteria: accordingly compensation expense is recognized for such awards when it becomes probable that the related performance condition will be satisfied. The Company selected the Black-Scholes-Merton option pricing model as the most appropriate model for determining the fair value for its stock options awards and Employee Stock Purchase Plan, whereas the fair value of restricted stock units is based on the closing market value of the underlying shares at the date of grant. The option-pricing model requires several assumptions, of which the most significant are the expected share price, volatility and the expected option term. Expected volatility was calculated based upon actual historical stock price movements over the most recent periods ending on the grant date, equal to the expected term of the options. The expected term of options granted is based upon historical experience and represents the period of time between when the options are granted and when they are expected to be exercised. The risk-free interest rate is based on the yield from U.S. treasury bonds with an equivalent term to the expected term of the options. The Company applies ASU 2018-07, "Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting" with respect to options and warrants issued to non-employees consultants. ASC No. 718 requires the use of option valuation models to measure the fair value of the options and warrants at the date of grant. |
Income taxes: | v. Income taxes: The Company accounts for income taxes in accordance with ASC No. 740, "Income Taxes" ("ASC No. 740"). This codification prescribes the use of the asset and liability method whereby deferred tax asset and liability account balances are determined based on differences between financial reporting and tax bases of assets and liabilities and for carry-forward tax losses. Deferred taxes are measured using the enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company provides a valuation allowance, if necessary, to reduce deferred tax assets to their estimated realizable value if it is more likely than not that some portion or all of the deferred tax asset will not be realized. The deferred tax assets and liabilities are classified as noncurrent in the statement of financial position The Company accounts for uncertain tax positions in accordance with the provisions of ASC No. 740. Accounting guidance addresses the determination of whether tax benefits claimed or expected to be claimed on a tax return should be recorded in the consolidated financial statements, under which a company may 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 the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position should be measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement. Accordingly, the Company reports a liability for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in tax expense. |
Basic and diluted net loss per share: | w. Basic and diluted net loss per share: Basic and diluted net loss per share is computed based on the weighted-average number of ordinary shares outstanding during each year. Diluted loss per share is computed based on the weighted average number of ordinary shares outstanding during the period, plus dilutive potential shares considered outstanding during the period, in accordance with ASC 260-10. Basic and diluted net loss per ordinary share was the same for each period presented as the inclusion of all potential ordinary shares outstanding was anti-dilutive. For the years ended December 31, 2018, 2019 and 2020, all outstanding options, RSUs and Convertible Senior Notes have been excluded from the calculation of the diluted net loss per share since their effect was anti-dilutive. |
Comprehensive income (loss): | x. Comprehensive income: The Company accounts for comprehensive income (loss) in accordance with ASC No. 220, "Comprehensive Income" ("ASC No. 220"). This statement establishes standards for the reporting and display of comprehensive income and its components in a full set of general purpose financial statements. Comprehensive income generally represents all changes in shareholders' equity during the period except those resulting from investments by, or distributions to shareholders. The total accumulated other comprehensive income was comprised as follows: Year ended December 31, 2020 Unrealized gains on marketable securities Unrealized gains (losses) on cash flow hedges Total Beginning balance, net $ 852 $ 505 $ 1,357 Other comprehensive income before reclassifications, net 2,962 11,425 14,387 Amounts reclassified from accumulated other comprehensive income, net (46 ) (6,292 ) (6,338 ) Total accumulated other comprehensive income, net $ 3,768 $ 5,638 $ 9,406 Year ended December 31, 2019 Unrealized gain (losses) on marketable securities Unrealized gain (losses) on cash flow hedges Total Beginning balance, net $ (315 ) $ (1,376 ) $ (1,691 ) Other comprehensive income before reclassifications, net 1,201 2,027 3,228 Amounts reclassified from accumulated other comprehensive income, net (34 ) (146 ) (180 ) Total accumulated other comprehensive income, net $ 852 $ 505 $ 1,357 |
Concentration of credit risks: | y. Concentration of credit risks: Financial instruments that potentially subject the Company to concentrations of credit risk consist principally of cash and cash equivalents, short-term and restricted deposits. The majority of the Company's and its subsidiaries' cash and cash equivalents, short-term, marketable securities, hedging and restricted deposits are invested with major banks in Israel, Brazil and the United States. Such investments in the United States may be in excess of insured limits and are not insured in other jurisdictions. Generally, these investments may be redeemed upon demand and, therefore, bear minimal risk. |
Fair value of financial instruments: | z. Fair value of financial instruments: ASC No. 820, “Fair Value Measurements and Disclosures” defines fair value and establishes a framework for measuring fair value. Fair value is an exit price, representing the amount that would be received for selling an asset or paid for the transfer of a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or a liability. A three-tier fair value hierarchy is established as a basis for considering such assumptions and for inputs used in the valuation methodologies in measuring fair value: Level 1 - Unadjusted quoted prices in active markets that are accessible on the measurement date for identical, unrestricted assets or liabilities; Level 2 - Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability. Level 3 - Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity). The fair value hierarchy also requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The carrying values of cash and cash equivalents, short-term and restricted deposits, trade receivables, trade payables, employees and payroll accruals and accrued expenses and other current liabilities approximate fair values due to the short-term maturities of these instruments. The following table represents the fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2020: F - 24 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) December 31, 2020 Fair value measurements using input type Level 1 Level 2 Level 3 Total Financial assets: Money market funds $ 20,656 $ - $ - $ 20,656 Marketable securities - 826,804 - 826,804 Investments in privately held companies - - 1,537 1,537 Foreign currency derivatives presented as contracts assets - 7,083 - 7,083 Financial liabilities: Foreign currency derivatives presented as contracts liabilities - (1,961 ) - (1,961 ) $ 20,656 $ 831,926 $ 1,537 $ 854,119 The following table represents the fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2019: December 31, 2019 Fair value measurements using input type Level 1 Level 2 Level 3 Total Financial assets: Money market funds $ 204,067 $ - $ - $ 204,067 Marketable securities - 341,599 - 341,599 Investment in privately held companies - - 862 862 Foreign currency derivatives presented as contracts assets - 1,465 - 1,465 Financial liabilities: Foreign currency derivatives presented as contracts liabilities - (696 ) - (696 ) $ 204,067 $ 342,368 $ 862 $ 547,297 As of December 31, 2020, the total estimated fair value of the Convertible Senior Notes was $1,431,058 (2023 notes were $844,351 and 2025 notes were $586,707). The fair value of the convertible notes is considered to be Level 2 within the fair value hierarchy and was determined based on quoted prices of the convertible notes in an over-the-counter market. |
Government grants: | aa. Government grants: Grants from the Investment and Development Authority for Economic and Industrial Development (the "Investment Authority") for participation in salary expenses for employees in national priority areas and the Israel Innovation Authority (the "IIA"), for participation in research and development activities, are recognized at the time the Company is entitled to such grants on the basis of the related cost incurred. The expenses are included in the Consolidated Financial Statements net of related grants. The Company will not be obligate to pay royalties to Investment Authority and IIA. The Company recorded grants from the Investment Authority in the amounts of $1,172, $852 and $957 for the years ended December 31, 2018, 2019 and 2020, respectively. The Company recorded grants from IIA in the amounts of $758 and $136 for the years ended December 31, 2019 and 2020. |
Leases: | bb. Leases On January 1, 2019, the Company adopted ASU No. 2016-02, Leases (ASC 842). The Company determines if an arrangement is a lease and the classification of that lease at inception based on: (1) whether the contract involves the use of a distinct identified asset, (2) whether the Company obtains the right to substantially all the economic benefits from the use of the asset throughout the period, and (3) whether the Company has a right to direct the use of the asset. The Company elected to not recognize a lease liability and a right-of-use (“ROU”) asset for leases with a term of twelve months or less. The Company also elected the practical expedient to not separate lease and non-lease components for its leases. Determining whether an arrangement contains a lease Under Topic 842 on the inception date of the lease, the Company determines whether the arrangement is a lease or contains a lease, while examining if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company as a lessee The Company entered into operating leases primarily for offices and vehicles. The leases have remaining lease terms of up to 10 years. Leases are classified as finance or operating, with classification affecting the pattern and classification of expense recognition in the income statement. A lease is a finance lease if it meets any one of the criteria below, otherwise the lease is an operating lease: • The lease transfers ownership of the underlying asset to the lessee by the end of the lease term. • The lease grants the lessee an option to purchase the underlying asset that the lessee is reasonably certain to exercise. F - 26 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) • The lease term is for the major part of the remaining economic life of the underlying asset. • The present value of the sum of the lease payments and any residual value guaranteed by the lessee that is not already reflected in the lease payments equals or exceeds substantially all of the fair value of the underlying asset. • The underlying asset is of such a specialized nature that it is expected to have no alternative use to the lessor at the end of lease term. Since all of the Company’s lease contracts do not meet any of the criteria above, the Company concluded that all of its lease contracts should be classified as operating leases. ROU assets represent the right to use an underlying asset for the lease term and lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets are initially measured at amounts, which represents the discounted present value of the lease payments over the lease, plus any initial direct costs incurred. The lease liability is initially measured at lease commencement date based on the discounted present value of lease payments over the lease term. The implicit rate within the operating leases is generally not determinable, therefore the Company uses the Incremental Borrowing Rate (“IBR”) based on the information available at the commencement date in determining the present value of lease payments. The Company’s IBR is estimated to approximate the interest rate for collateralized borrowing with similar terms and payments and in economic environments where the leased asset is located. Certain leases include options to extend or terminate the lease. An option to extend the lease is considered in connection with determining the ROU. asset and lease liability when it is reasonably certain that the Company will exercise that option. An option to terminate is considered unless it is reasonably certain that the Company will not exercise the option. Payments under lease arrangements are primarily fixed, however, certain lease agreements contain variable payments, which are expensed as incurred and not included in the operating lease right-of-use assets and liabilities. Variable lease payments are primarily comprised of payments affected by common area maintenance and utility charges. Under ASC No. 842, the Company is required to remeasure and reallocate the consideration in a contract when they remeasure the lease liability, which occurs as a result of any of the following: • A change to the lease term (e.g., a change resulting from a lessee’s determination that it is reasonably certain to exercise an existing option to extend a lease that it had previously determined it was not reasonably certain to exercise) • A change in the assessment of whether a lessee is reasonably certain to exercise an option to purchase the underlying asset • A change in the amount that it is probable the lessee will owe under a residual value guarantee F - 27 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) • A resolution of a contingency that results in some or all of the payments allocated to the lease component that were previously determined to be variable meeting the definition of lease payments (e.g., an event occurs that results in variable lease payments that were linked to the performance use of the underlying asset becoming fixed payments for the remainder of the lease term) • A lease modification that is not accounted for as a separate contract After lease commencement, the Company measures the lease liability at the present value of the remaining lease payments using the discount rate determined at lease commencement. The Company as a lessor The Company subleases certain office spaces to third-parties. Sublease income is recognized over the term of the agreement. |
Reclassification of prior years' amounts: | cc. Reclassification of prior years' amounts: Certain amounts in prior years' financial statements have been reclassified to conform to the current year's presentation. The reclassification had no effect on previously reported net loss or shareholders' equity. dd. Recently issued accounting standards, not yet adopted by the Company: In August 2020, the FASB issued ASU No. 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity (ASU 2020-06), which simplifies the accounting for certain financial instruments with characteristics of liabilities and equity, including convertible instruments and contracts in an entity’s own equity. Among other changes, ASU 2020-06 removes from GAAP the liability and equity separation model for convertible instruments with a cash conversion feature and a beneficial conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt. Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument. Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC Topic 815, Derivatives and Hedging, or (2) a convertible debt instrument was issued at a substantial premium. Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share (EPS). ASU 2020-06 is effective for fiscal years beginning after December 15, 2021, with early adoption permitted for fiscal years beginning after December 15, 2020 and can be adopted on either a fully retrospective or modified retrospective basis. Effective January 1, 2021, the Company early adopted ASU 2020-06 using the modified retrospective approach. Adoption of the new standard resulted in a decrease to accumulated deficit of $53,528, a decrease to additional paid-in capital of $215,713, and an increase to Convertible Senior Notes, net of $162,185. Interest expenses recognized in future periods will be reduced as a result of accounting for the convertible debt instrument as a single liability measured at its amortized cost. F - 28 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) In December 2019, the FASB issued ASU No. 2019-12, Income Taxes (Topic 740): “Simplifying the Accounting for Income Taxes” (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for the Company in the first quarter of 2021 on a prospective basis, and early adoption is permitted. The impact of the new guidance on the Company's consolidated financial statements is immaterial. Recently adopted accounting standards: In January 2017, the FASB issued ASU 2017-04, Simplifying the Test for Goodwill Impairment (Topic 350). This standard eliminates Step 2 from the goodwill impairment test, instead requiring an entity to recognize a goodwill impairment charge for the amount by which the goodwill carrying amount exceeds the reporting unit's fair value. This guidance is effective for interim and annual goodwill impairment tests in fiscal years beginning after December 15, 2019 with early adoption permitted. This guidance must be applied on a prospective basis. the Company adopted this standard in the first quarter of 2020. The adoption did not have material impact on its consolidated financial statements. In August 2018, the FASB issued ASU 2018-13, regarding ASC Topic 820 “Fair Value Measurement,” which modifies the disclosure requirements for fair value measurements for certain types of investments. The Company adopted this standard in the first quarter of 2020. The adoption did not have a material impact on its consolidated financial statements. In June 2016, FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments. ASU 2016-13 amends the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the more timely recognition of losses. ASU 2016-13 requires expected credit losses relating to financial assets to be measured on an amortized cost basis to be recorded through an allowance for credit losses. ASU 2016-13 also requires an investor to determine whether a decline in the fair value below the amortized cost basis (i.e., impairment) of an available for sale debt security is due to credit-related factors or noncredit-related factors. Any impairment that is not credit related is recognized in OCI , net of applicable taxes. However, if an entity intends to sell an impaired available for sell debt security or more likely than not will be required to sell such a security before recovering its amortized cost basis, the entire impairment amount must be recognized in earnings with a corresponding adjustment to the security’s amortized cost basis. Credit-related impairment is recognized as an allowance on the balance sheet with a corresponding adjustment to earnings. The Company adopted ASU 2016-13 using the modified retrospective approach as of January 1, 2020. The adoption by the Company of the new guidance did not have a material impact on its consolidated financial statements. |
SIGNIFICANT ACCOUNTING POLICI_3
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Property and Equipment, Estimated Useful Lives | Property and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets at the following annual rates: % Computers, peripheral equipment and electronic equipment 15 – 33 (mainly 33) Internal use software 33 Office furniture and equipment 6 – 14 (mainly 6) Vehicles 15 Leasehold improvements Over the shorter of the related lease period or the life of the asset |
Schedule of Total Accumulated Other Comprehensive Loss, Net | The total accumulated other comprehensive income was comprised as follows: Year ended December 31, 2020 Unrealized gains on marketable securities Unrealized gains (losses) on cash flow hedges Total Beginning balance, net $ 852 $ 505 $ 1,357 Other comprehensive income before reclassifications, net 2,962 11,425 14,387 Amounts reclassified from accumulated other comprehensive income, net (46 ) (6,292 ) (6,338 ) Total accumulated other comprehensive income, net $ 3,768 $ 5,638 $ 9,406 Year ended December 31, 2019 Unrealized gain (losses) on marketable securities Unrealized gain (losses) on cash flow hedges Total Beginning balance, net $ (315 ) $ (1,376 ) $ (1,691 ) Other comprehensive income before reclassifications, net 1,201 2,027 3,228 Amounts reclassified from accumulated other comprehensive income, net (34 ) (146 ) (180 ) Total accumulated other comprehensive income, net $ 852 $ 505 $ 1,357 |
Schedule of Financial Assets and Liabilities Measured at Fair Value | The following table represents the fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2020: F - 24 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 2:- SIGNIFICANT ACCOUNTING POLICIES (Cont.) December 31, 2020 Fair value measurements using input type Level 1 Level 2 Level 3 Total Financial assets: Money market funds $ 20,656 $ - $ - $ 20,656 Marketable securities - 826,804 - 826,804 Investments in privately held companies - - 1,537 1,537 Foreign currency derivatives presented as contracts assets - 7,083 - 7,083 Financial liabilities: Foreign currency derivatives presented as contracts liabilities - (1,961 ) - (1,961 ) $ 20,656 $ 831,926 $ 1,537 $ 854,119 The following table represents the fair value hierarchy of the Company's financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2019: December 31, 2019 Fair value measurements using input type Level 1 Level 2 Level 3 Total Financial assets: Money market funds $ 204,067 $ - $ - $ 204,067 Marketable securities - 341,599 - 341,599 Investment in privately held companies - - 862 862 Foreign currency derivatives presented as contracts assets - 1,465 - 1,465 Financial liabilities: Foreign currency derivatives presented as contracts liabilities - (696 ) - (696 ) $ 204,067 $ 342,368 $ 862 $ 547,297 |
MARKETABLE SECURITIES (Tables)
MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Marketable Securities Calssified as Available-for-sale Securities | As of December 31, 2019 and 2020, the Company held marketable securities classified as available-for-sale securities as follows: December 31, 2020 2019 LESS THAN A YEAR Amortized cost Gross unrealized gains Gross unrealized losses Fair value Amortized cost Gross unrealized gains Gross unrealized losses Fair value Government and corporate debentures - fixed interest rate $ 244,434 $ 526 $ (48 ) $ 244,912 $ 148,437 $ 329 $ (15 ) $ 148,751 Government-sponsored enterprises 10,006 32 - 10,038 12,548 - (1 ) 12,547 Government and corporate debentures - floating interest rate 34,967 10 - 34,977 3,003 1 (1 ) 3,003 $ 289,407 $ 568 $ (48 ) $ 289,927 $ 163,988 $ 330 $ (17 ) $ 164,301 December 31, 2020 2019 MORE THAN 1 YEAR THROUGH FIVE YEARS Amortized cost Gross unrealized gains Gross unrealized losses Fair value Amortized cost Gross unrealized gains Gross unrealized losses Fair value Government and corporate debentures - fixed interest rate $ 494,520 $ 3,821 $ (143 ) $ 498,198 $ 135,040 $ 595 $ (65 ) $ 135,570 Government-sponsored enterprises 21,264 67 - 21,331 17,579 9 (3 ) 17,585 Government and corporate debentures - floating interest rate 17,331 24 (7 ) 17,348 24,141 8 (6 ) 24,143 $ 533,115 $ 3,912 $ (150 ) $ 536,877 $ 176,760 $ 612 $ (74 ) $ 177,298 |
PREPAID EXPENSES AND OTHER CU_2
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | December 31, 2020 2019 Government authorities $ 7,381 $ 3,548 Hedging transaction asset 7,083 1,465 Prepaid expenses 13,984 8,468 Other current assets 12,218 5,730 $ 40,666 $ 19,211 |
PROPERTY AND EQUIPMENT, NET (Ta
PROPERTY AND EQUIPMENT, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment, Net [Abstract] | |
Schedule of Property and Equipment, Net | The composition of property and equipment, net is as follows: December 31, 2020 2019 Cost: Leasehold improvements $ 41,101 $ 34,831 Computers, peripheral equipment and electronic equipment 27,449 22,534 Internal use software 2,467 1,891 Office furniture and equipment 6,464 5,664 Vehicles 130 - 77,611 64,920 Less - accumulated depreciation 41,748 33,214 Depreciated cost $ 35,863 $ 31,706 |
BUSINESS COMBINATION (Tables)
BUSINESS COMBINATION (Tables) - InkFrog, Inc. [Member] | 12 Months Ended |
Dec. 31, 2020 | |
Schedule of Fair Values of Assets Acquired and Liabilities Assumed | The following table summarizes the fair values of the assets acquired and liabilities assumed from Inkfrog: (in thousands) Trade receivables $ 226 Prepaid expenses and other current assets 361 Intangible assets 2,016 Goodwill 4,936 Total Assets $ 7,539 Current liabilities 461 Deferred tax liability 452 913 Total Liabilities $ 913 Total purchase price allocation, net of cash acquired $ 6,626 |
Schedule of Identifiable Assets as of Date of Acquisition | The following table provides details regarding the identifiable assets acquired as of the date of the acquisition: Fair value Weighted Average Useful Life (in thousands) (in years) Technology 1,338 8 Customer relations 387 7 Distribution agreement 291 1.5 Total purchased intangible assets $ 2,016 |
INTANGIBLE ASSETS, NET (Tables)
INTANGIBLE ASSETS, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets | December 31, 2020 2019 Cost: Technology $ 9,614 $ 8,275 Customer relations 11,054 10,667 Customer data 12,043 12,043 Domain 552 552 Distribution agreement 291 - 33,554 31,537 Less - accumulated amortization 14,273 11,696 Intangible assets, net $ 19,281 $ 19,841 |
Schedule of estimated amortization expense | Estimated amortization expense for the years ended: 2021 $ 2,278 2022 2,087 2023 1,790 2024 1,732 Thereafter 11,394 $ 19,281 |
ACCRUED EXPENSES AND OTHER CU_2
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Other Liabilities, Current [Abstract] | |
Summary of Accrued Expenses and Other Current Liabilities | December 31, 2020 2019 Accrued expenses $ 40,649 $ 36,154 Government authorities 26,008 17,584 Hedging transaction liability 1,961 696 Uncertain tax positions 1,811 2,030 $ 70,429 $ 56,464 |
CONVERTIBLE NOTES (Tables)
CONVERTIBLE NOTES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Net Carrying Amount | The net carrying amount of the Notes were as follows (in thousands): Principal outstanding Unamortized debt discount Unamortized debt issuance costs Net carrying value December 31, 2020: Convertible Notes $ 575,000 $ (109,655 ) $ (11,766 ) $ 453,579 The net carrying amount of the equity component of the 2025 Convertible Notes were as follows (in thousands): Amount allocated to conversion option Less: allocated issuance costs Equity component, net December 31, 2020: Convertible notes $ 116,521 $ (3,184 ) $ 113,337 The Company recognized interest expense on the 2025 Convertible Notes as follows: Year ended December 31, 2020 Amortization of debt discount and issuance costs $ 7,629 F - 36 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) 2025 Capped Call Transactions In connection with the pricing of the 2025 Convertible Notes, the Company entered into capped call transactions (the “Capped Call Transactions”) with certain of the purchasers of the Convertible Notes. The 2025 Capped Calls are purchased call options that give the Company the option to purchase, subject to anti-dilution adjustments substantially identical to those in the 2025 Convertible Notes.. The 2025 Capped Calls will expire in 2025, if not exercised earlier. The 2025 Capped Calls are intended to offset potential dilution to the Company’s common shares and/or offset the potential cash payments that the Company could be required to make in excess of the principal amount upon any conversion of the 2025 Notes under certain circumstances described in the Capped Call Transactions. The 2025 Capped Calls are separate transactions and are not part of the terms of the 2025 Notes. As the Capped Call Transactions are considered indexed to the Company's stock and are considered equity classified, they are recorded in shareholders’ equity on the consolidated balance sheets. The Company paid an aggregate amount of $46,000 for the 2025 Capped Calls. The amount paid for the 2025 Capped Calls was recorded as a reduction to Additional paid-in capital in the consolidated balance sheets. 2023 Convertible notes In June and July of 2018, The Company issued $442,750 aggregate principal amount, 0% coupon rate, of Convertible Senior Notes due 2023 (the “2023 Convertible Notes”). Subject to satisfaction of certain conditions and during certain periods, as defined in the indenture governing the Convertible Notes, the holders will have the option to exchange the notes into cash or the Company ordinary shares, if any (subject to the Company right to pay cash in lieu of all or a portion of such shares). The conversion rate was initially 7.0113 Ordinary Shares per $1,000 principal amount of notes (equivalent to an initial conversion price of approximately $142.63 per Ordinary Share). The conversion rate will be subject to adjustment in some events, but will not be adjusted for any accrued and unpaid special interest, if any. In addition, following certain corporate events that occur prior to the maturity date, or following the Company’s delivery of a notice of tax redemption, the Company will, in certain circumstances, increase the conversion rate for a holder who elects to convert his or her Convertible Notes in connection with such a corporate event or notice of tax redemption, as the case may be. Conversion terms: Holders may convert their notes at their option at any time prior to the close of business on the business day immediately preceding January 1, 2023 only under the following circumstances: F - 37 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) e. During any calendar quarter commencing after September 30, 2018 (and only during such calendar quarter), if the f. During the five business day period after any ten consecutive trading day period (the “measurement period”) in g. If the Company calls the notes for a tax redemption, at any time prior to the close of business on the second h. Upon the occurrence of specified corporate events. On or after January 1, 2023 until the close of business on the i. For at least 20 trading days during the period of 30 consecutive trading days ended June 30, 2020, the last reported In accounting for the issuance of the Convertible Notes, the Company separated the Convertible Notes into liability and equity components. The carrying amount of the equity component representing the conversion option was $105,375 and was determined by deducting the fair value of the liability component from the par value of the Convertible Notes. The equity component is not remeasured as long as it continues to meet the conditions for equity classification. The excess of the principal amount of the liability component over its carrying amount ("debt discount") is amortized to interest expense over the term of the Convertible Notes at an effective interest rate of 6.20% over the contractual terms of the Convertible Notes. Debt issuance costs related to the 2023 Convertible Notes comprised of commissions and payable to third party consultants of $11,511 and third party costs of $1,090. The Company allocated the total amount incurred to the liability and equity components of the 2023 Convertible Notes based on their relative values. Issuance costs attributable to the liability component were $9,602 and will be amortized to interest expense using the effective interest method over the contractual term. Issuance costs attributable to the equity component were netted with the equity component in stockholders’ equity. The Company initially recorded equity issuance costs of $2,999. F - 38 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) The net carrying amount of the 2023 Convertible Notes were as follows (in thousands): Principal outstanding Unamortized debt discount Unamortized debt issuance costs Converted to shares Net carrying value December 31, 2020: Convertible Notes $ 442,750 $ (57,435 ) $ (4,275 ) $ (179 ) $ 380,861 Principal outstanding Unamortized debt discount Unamortized debt issuance costs Net carrying value December 31, 2019: Convertible Notes $ 442,750 $ (77,527 ) $ (6,508 ) $ 358,715 The net carrying amount of the equity component of the 2023 Convertible Notes were as follows (in thousands): Amount allocated to conversion option Less: allocated issuance costs Converted to shares Equity component, net December 31, 2020: Convertible notes $ 105,375 $ (2,999 ) $ 179 $ 102,555 The Company recognized interest expense on the 2023 Convertible Notes as follows: Year ended December 31, 2020 Amortization of debt discount and issuance costs $ 22,325 The effective interest rate of the liability component is 6.20% for the Convertible Notes. F - 39 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 9:- CONVERTIBLE NOTES (Cont.) Amount allocated to conversion option Less: allocated issuance costs and Capped call Equity component, net December 31, 2019: Convertible notes $ 105,375 $ (48,337 ) $ 57,038 The Company recognized interest expense on the Notes as follows (in thousands, except for percentages): Year ended December 31, 2019 Amortization of debt discount and issuance costs $ 20,938 |
LEASE (Tables)
LEASE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Schedule of Components of Lease Cost | The Company`s leases include offices for its facilities worldwide, as well as car leases, which are all classified as operating leases. Certain leases include renewal options that are under the Company`s sole discretion. The renewal options were included in the right of use (“ROU”) and liability calculation if it was reasonably certain that the Company will exercise the option. December 31 2020 2019 Lease cost: Fixed cost and variable payments that depend on an index or rate $ 21,104 $ 16,995 Short-term lease cost 1,854 1,031 Total operating lease cost $ 22,958 $ 18,026 |
Schedule of Supplemental Cash Flow Information | December 31 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ (19,061) $ (15,376) Weighted average remaining operating lease term 6.57 7.79 Weighted average discount rate operating lease 4.1 % 4.8 % |
Schedule of Future Minimum Lease Payments of Operating Lease Liabilities | Future minimum lease payments of the operating lease liabilities as of December 31, 2020 were as follows: Fiscal Years Ending December 31, Lease Commitments 2021 $ 23,186 2022 20,461 2023 14,786 2024 11,670 2025 10,315 After 2026 33,227 Total operating lease payments 113,645 Less: Imputed interest 17,122 Present value of lease liabilities $ 96,523 |
SHAREHOLDERS' EQUITY (Tables)
SHAREHOLDERS' EQUITY (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Stockholders' Equity Note [Abstract] | |
Total Share-Based Compensation Expense | The total share-based compensation expense related to all of the Company's equity-based awards, which include options, RSUs and employee stock purchase rights issued pursuant to the Company's Employee Share Purchase Plan (“ESPP”) and recognized for the years ended December 31, 2018, 2019 and 2020 was comprised as follows: Year ended December 31, 2020 2019 2018 Cost of revenues $ 9,127 $ 5,854 $ 4,418 Research and development 76,882 56,161 39,417 Sales and marketing 22,845 18,458 9,770 General and administrative 38,458 28,864 18,725 Total share-based compensation expense $ 147,313 $ 109,337 $ 72,330 |
Schedule of Stock Options Granted to Employees Activity | A summary of the activity in options granted to employees for the year ended December 31, 2020 is as follows: Number of options Weighted average exercise price Weighted Average remaining contractual term (in years) Aggregate intrinsic value Balance at December 31, 2019 7,438,119 $ 37.53 5.49 $ 631,994 Granted 715,247 $ 155.62 Exercised (3,493,875 ) $ 12.59 Forfeited (41,111 ) $ 80.18 Balance at December 31, 2020 4,618,380 $ 74.31 6.74 $ 812,500 Exercisable at December 31, 2020 2,844,347 $ 50.61 5.80 $ 567,048 Vested and expected to vest at December 31, 2020 4,530,353 $ 73.56 6.71 $ 800,307 |
Schedule of Stock Option Valuation Assumptions - Compensation to Employees | The following table set forth the parameters used in computation of the options compensation to employees for the years ended December 31, 2018, 2019 and 2020: Year ended December 31, 2020 2019 2018 Expected volatility 42.26%-49.24% 42.60%-45.24% 45.19%-46.64% Expected dividends 0% 0% 0% Expected term (in years) 4.84-4.99 4.94 -4.99 5.17 -7.53 Risk free rate 0.25%-1.40% 1.51%-2.47% 2.59%-3.03% |
Summary of Options Data | A summary of options data for the years ended December 31, 2018, 2019 and 2020, is as follows: Year ended December 31, 2020 2019 2018 Weighted-average grant date fair value of options granted $ 68.91 $ 53.67 $ 34.93 Total intrinsic value of the options exercised $ 436,187 $ 128,003 $ 137,448 Total fair value of shares vested $ 40,367 $ 33,316 $ 27,629 |
Schedule of Options Outstanding and Exercisable | The following tables summarize information about the Company's outstanding and exercisable options granted to employees as of December 31, 2020: Exercise price (range) Options outstanding as of December 31, 2020 Weighted average remaining contractual term Options exercisable as of December 31, 2020 Weighted average remaining contractual term (years) (years) 0-19.79 451,409 2.91 442,098 2.80 19.8-21.13 586,121 4.67 586,121 4.67 21.14-51.32 326,467 5.17 300,362 5.09 51.33-56.61 451,958 6.12 404,324 6.12 56.62-61.75 741,489 7.12 430,890 7.12 61.76-101.67 407,639 7.57 218,296 7.39 101.68-102.67 736,632 8.12 305,214 8.12 102.68-142.09 266,061 8.55 88,162 8.35 142.1-143.13 544,383 9.14 57,108 9.14 143.14-286.29 106,221 9.51 11,772 9.06 4,618,380 6.74 2,844,347 5.80 |
Schedule Stock Options Outstanding and Exercisable to Non-Employees | The following table summarizes information about the Company's outstanding and exercisable options to purchase ordinary shares granted to non-employees consultants as of December 31, 2020: Grant Date Options outstanding as of December 31, 2020 Exercise price Exercisable as of December 31, 2020 Exercisable through $ January 9, 2013 3,400 2.34 3,400 January 9, 2023 |
Schedule of Stock Option Valuation Assumptions - Non-Employees | The following table set forth the parameters used in computation of the employee stock purchase plan for the years ended December 31, 2018, 2019 and 2020: Year ended December 31, 2020 2019 2018 Expected volatility 34.52%-83.3% 31.88%-54.49% 39.9%-41.2% Expected dividends 0% 0% 0% Expected term (in years) 0.5 0.5 0.5 Risk free rate 0.13%-0.95% 1.89%-2.52% 1.85%-2.28% |
Schedule of Restricted Stock Unit Activity | f. A summary of RSU activity for the year ended December 31, 2020, is as follows: Number of shares Weighted average grant date fair value per share $ Unvested as of December 31, 2019 2,124,430 $ 98.50 Granted 1,054,030 $ 199.80 Vested (956,651 ) $ 93.16 Forfeited (143,382 ) $ 120.44 Unvested as of December 31, 2020 2,078,427 $ 150.87 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income (Loss) before Taxes on Income | b. Loss before taxes on income is comprised as follows: Year ended December 31, 2020 2019 2018 Domestic $ (151,460 ) $ (85,369 ) $ (50,679 ) Foreign 1,295 1,553 16,766 Loss before taxes on income $ (150,165 ) $ (83,816 ) $ (33,913 ) |
Schedule of Deferred Income Taxes | Deferred taxes reflect the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts recorded for tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: December 31, 2020 2019 Deferred tax assets: Net operating loss carryforward $ 30,481 $ 19,362 Capital losses carry-forwards 1 54 Operating lease liabilities 16,495 15,197 Research and development expenses carryforward 1,742 2,093 Share-based compensation 18,242 12,955 Depreciation differences 582 1,082 Accrued employees costs 3,506 1,774 Intra-entity intellectual property transfer(1) - 1,835 Intangible assets 358 - Tax advances 4,032 3,353 Other 139 189 Deferred tax assets 75,578 57,894 Deferred tax liabilities: Convertible notes $ 19,415 $ 8,990 Other financial income 15,343 - Property and equipment 1,740 299 Operating lease ROU assets 14,999 14,401 Acquired Intangible assets 1,880 1,831 Share-based compensation - - Other 1,574 209 Deferred tax liabilities $ 54,951 $ 25,730 Valuation allowance (6,797 ) (30,470 ) Deferred taxes are included in the consolidated balance sheets, as follows: Long-term receivables $ 1,813 $ 14,730 Long-term liabilities $ 15,643 $ 13,036 F - 49 WIX.COM LTD. AND ITS SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS U.S. dollars in thousands (except share and per share data) NOTE 13:- INCOME TAXES (Cont.) (1) During 2019, the Company completed an intra-entity transfer from US to Israel of certain intangible property |
Schedule of Income Taxes | d. Income taxes are comprised as follows: Year ended December 31, 2020 2019 2018 Current $ (535 ) $ 3,309 $ 4,188 Deferred 15,524 (711 ) (981 ) $ 14,989 $ 2,598 $ 3,207 Domestic $ 16,193 $ (1,981 ) $ 1,140 Foreign (1,205 ) 4,579 2,067 $ 14,989 $ 2,598 $ 3,207 |
Reconciliation of Effective Tax Rate to Statutory Rate | e. A reconciliation of the Company's theoretical income tax expense to actual income tax expense as follows: Year ended December 31, 2020 2019 2018 Loss before taxes on income $ (150,165 ) $ (83,816 ) $ (33,913 ) Statutory tax rate 23 % 23 % 23 % Theoretical income tax expense (34,538 ) (19,278 ) (7,800 ) Deferred tax assets for which valuation allowance was provided 29,485 8,749 (1,925 ) Non-deductible option expenses (5,529 ) (443 ) 12,609 Non-deductible expenses 627 2,280 824 Tax adjustment in respect of different tax rate of foreign subsidiary 345 (249 ) (1,627 ) Preferred enterprise benefits 23,700 9,732 - Rate change impact (57 ) (93 ) (174 ) Intra-entity intellectual property transfer - 196 - Different tax rate 372 463 - Foreign tax - 102 1,182 Other 584 1,139 118 Income tax expense $ 14,989 $ 2,598 $ 3,207 |
Schedule of reconciliation of the opening and closing amounts of total unrecognized tax benefits | A reconciliation of the opening and closing amounts of total unrecognized tax benefits is as follows: Year ended December 31, 2020 2019 2018 Opening balance $ 2,030 $ 334 $ 1,378 Increases (decrease) related to previous and current year tax positions (219 ) 1,696 (1,044 ) Closing balance $ 1,811 $ 2,030 $ 334 |
FINANCIAL INCOME, NET (Tables)
FINANCIAL INCOME, NET (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Nonoperating Income (Expense) [Abstract] | |
Schedule of Financial Income, Net | Year ended December 31, 2020 2019 2018 Bank charges $ (539 ) $ (533 ) $ (310 ) Income (expenses) related to hedging activity (5,529 ) 963 1,435 Amortization of debt discount and issuance costs (29,954 ) (20,938 ) (10,004 ) Exchange rate loss (2,352 ) (2,905 ) (3,522 ) Other financial income(1) 69,042 - - Total expenses 30,668 (23,413 ) (12,401 ) Interest income 16,391 19,792 9,607 Total financial income (expenses), net $ 47,059 $ (3,621 ) $ (2,794 ) |
BASIC AND DILUTED NET LOSS PE_2
BASIC AND DILUTED NET LOSS PER SHARE (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Net Loss Per Share | Year ended December 31, 2020 2019 2018 Net loss available to shareholders of ordinary shares $ (165,154 ) $ (86,414 ) $ (37,120 ) Denominator: Shares used in computing net loss per ordinary shares, basic and diluted 54,425,056 50,504,698 48,017,188 |
Summary of Reconciliation of Basic Weighted Average Number of Shares | The following table summarizes the reconciliation of the basic weighted average number of shares outstanding and the diluted weighted average number of shares outstanding. Year ended December 31, 2020 2019 2018 Shares used in computing net loss per ordinary shares, basic and diluted 54,425,056 50,504,698 48,017,188 The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: Stock options 4,621,780 7,447,519 7,676,713 Restricted share units 2,078,427 2,125,440 2,090,512 Convertible Notes 4,428,999 3,104,251 3,104,251 11,129,206 12,677,210 12,871,476 |
SEGMENTS, CUSTOMERS AND GEOGR_2
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Revenues by Geographical Areas | b. The following tables present total revenues for the years ended December 31, 2018, 2019 and 2020 and long-lived Revenues: Year ended December 31, 2020 2019 2018 North America (*) $ 563,824 $ 414,775 $ 316,446 Europe 251,597 195,324 159,768 Latin America 51,053 51,108 46,232 Asia and others 122,286 99,881 81,258 $ 988,760 $ 761,088 $ 603,704 (*) Include revenue from USA in amount of $278,784, $363,431 and $481,098 for 2018, 2019 and 2020, respectively. |
Schedule of Long-lived Assets by Geographical Areas | Long-lived assets and ROU: December 31, 2020 2019 Israel $ 56,684 $ 40,147 Europe and Asia 15,233 13,609 America 52,352 57,200 $ 124,268 $ 110,955 |
SIGNIFICANT ACCOUNTING POLICI_4
SIGNIFICANT ACCOUNTING POLICIES (Narrative) (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020USD ($)shares | Dec. 31, 2019USD ($)shares | Dec. 31, 2018USD ($)shares | |
Significant Accounting Policies [Line Items] | |||
Outstanding options and RSU's excluded from the calculation of the diluted net loss per share | shares | 11,129,206 | 12,677,210 | 12,871,476 |
Advertising expense | $ 282,804 | $ 187,318 | $ 165,319 |
Severance pay expenses | $ 15,737 | $ 12,042 | 9,489 |
Severance pay rate | 8.33% | ||
Weighted average interest rates of short-term deposits | 1.21% | 2.86% | |
Restricted deposits, weighted average interest rate | 0.038% | 0.05% | |
Number of reporting units | 1 | ||
Useful life of intangible assets | 13 years | ||
Foreign currency derivative fair value, net | $ 6,841 | $ 888 | |
Maximium plan contribution, percent of annual salary | 100.00% | ||
Maximum annual contribution to plan, per employee | $ 19 | ||
Employer matching contribution, percent of employee's contribution | 4.00% | ||
Defined contribution plan expenses | $ 1,117 | 727 | 587 |
Income (expenses) related to hedging activity | (5,529) | 963 | 1,435 |
Accumulated income (loss) on derivatives | 5,133 | 1,881 | (1,381) |
Grants | 957 | 852 | 1,172 |
Capitalization of software development costs | $ 575 | 778 | 392 |
Remaining lease term | 10 years | ||
Financial income in amount | $ 67,084 | ||
Total estimated fair value of convertible senior notes | 1,431,058 | ||
Appreciation of valuation related to holdings in a privately held company | 66,709 | ||
Decrease to accumulated deficit from early adoption of ASU 2020-06 using the modified retrospective approach | 53,528 | ||
Decrease to additional paid-in capital from early adoption of ASU 2020-06 using the modified retrospective approach | 215,713 | ||
Increase to Convertible Senior Notes | 162,185,000 | ||
Certain Employees Over 50 Years Of Age [Member] | |||
Significant Accounting Policies [Line Items] | |||
Maximum annual contribution to plan, per employee | 25 | ||
Not Designated as Hedging Instrument [Member] | |||
Significant Accounting Policies [Line Items] | |||
Foreign currency derivative fair value, net | $ (1,719) | (119) | |
Not Designated as Hedging Instrument [Member] | Foreign Exchange Forward [Member] | |||
Significant Accounting Policies [Line Items] | |||
Derivative notional amount | 111,372 | ||
Designated as Hedging Instrument [Member] | |||
Significant Accounting Policies [Line Items] | |||
Derivative notional amount | 45,000 | ||
Income (expenses) related to hedging activity | $ 1,582 | 147 | $ (1,687) |
Accumulated income (loss) on derivatives | 6,841 | ||
R&D projects [Member] | |||
Significant Accounting Policies [Line Items] | |||
Grants | 136 | $ 758 | |
2023 Note [Member] | |||
Significant Accounting Policies [Line Items] | |||
Total estimated fair value of convertible senior notes | 844,351 | ||
2025 Note [Member] | |||
Significant Accounting Policies [Line Items] | |||
Total estimated fair value of convertible senior notes | $ 586,707 |
SIGNIFICANT ACCOUNTING POLICI_5
SIGNIFICANT ACCOUNTING POLICIES (Schedule Of Property Plant And Equipment Estimated Useful Lives) (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Computers, peripheral equipment and electronic equipment | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 33.00% |
Computers, peripheral equipment and electronic equipment | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 15.00% |
Computers, peripheral equipment and electronic equipment | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 33.00% |
Office furniture and equipment | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 6.00% |
Office furniture and equipment | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 6.00% |
Office furniture and equipment | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 14.00% |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Annual depreciation rate | 15.00% |
Leasehold improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Depreciation rate, description | Over the shorter of the related lease period or the life of the asset |
SIGNIFICANT ACCOUNTING POLICI_6
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Reclassification of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Beginning Balance, net | $ 1,357 | $ (1,691) |
Other comprehensive income before reclassifications, net | 14,387 | 3,228 |
Amounts reclassified from accumulated other comprehensive income, net | (6,338) | (180) |
Total accumulated other comprehensive income, net | 9,406 | 1,357 |
Unrealized gains (losses) on marketable securities [Member] | ||
Beginning Balance, net | 852 | (315) |
Other comprehensive income before reclassifications, net | 2,962 | 1,201 |
Amounts reclassified from accumulated other comprehensive income, net | (46) | (34) |
Total accumulated other comprehensive income, net | 3,768 | 852 |
Unrealized gains (losses) on cash flow hedges [Member] | ||
Beginning Balance, net | 505 | (1,376) |
Other comprehensive income before reclassifications, net | 11,425 | 2,027 |
Amounts reclassified from accumulated other comprehensive income, net | (6,292) | (146) |
Total accumulated other comprehensive income, net | $ 5,638 | $ 505 |
SIGNIFICANT ACCOUNTING POLICI_7
SIGNIFICANT ACCOUNTING POLICIES (Schedule of Financial Assets and Liabilities Measured at Fair Value) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | $ 854,119 | $ 547,297 |
Foreign currency derivatives presented as contracts liabilities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial liabilities | (1,961) | (696) |
Money Market Funds [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 20,656 | 204,067 |
Marketable securities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 826,804 | 341,599 |
Investments in Privately Held Companies [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 1,537 | 862 |
Foreign currency derivatives presented as contracts assets [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 7,083 | 1,465 |
Level 1 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 20,656 | 204,067 |
Level 1 [Member] | Foreign currency derivatives presented as contracts liabilities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial liabilities | ||
Level 1 [Member] | Money Market Funds [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 20,656 | 204,067 |
Level 1 [Member] | Marketable securities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 1 [Member] | Investments in Privately Held Companies [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 1 [Member] | Foreign currency derivatives presented as contracts assets [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 2 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 831,926 | 342,368 |
Level 2 [Member] | Foreign currency derivatives presented as contracts liabilities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial liabilities | (1,961) | (696) |
Level 2 [Member] | Money Market Funds [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 2 [Member] | Marketable securities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 826,804 | 341,599 |
Level 2 [Member] | Investments in Privately Held Companies [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 2 [Member] | Foreign currency derivatives presented as contracts assets [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 7,083 | 1,465 |
Level 3 [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 1,537 | 862 |
Level 3 [Member] | Foreign currency derivatives presented as contracts liabilities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial liabilities | ||
Level 3 [Member] | Money Market Funds [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 3 [Member] | Marketable securities [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | ||
Level 3 [Member] | Investments in Privately Held Companies [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets | 1,537 | 862 |
Level 3 [Member] | Foreign currency derivatives presented as contracts assets [Member] | ||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Total financial assets |
MARKETABLE SECURITIES (Schedule
MARKETABLE SECURITIES (Schedule of Marketable Securities Calssified as Available-for-sale Securities) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Fair value | $ 289,927 | $ 164,301 |
Less Than A Year [Member] | ||
Amortized cost | 289,407 | 163,988 |
Gross unrealized gains | 568 | 330 |
Gross unrealized losses | (48) | (17) |
Fair value | 289,927 | 164,301 |
Government and corporate debentures - fixed interest rate Less Than A Year [Member] | ||
Amortized cost | 244,434 | 148,437 |
Gross unrealized gains | 526 | 329 |
Gross unrealized losses | (48) | (15) |
Fair value | 244,912 | 148,751 |
Government Sponsored Enterprises Less Than A Year [Member] | ||
Amortized cost | 10,006 | 12,548 |
Gross unrealized gains | 32 | |
Gross unrealized losses | (1) | |
Fair value | 10,038 | 12,547 |
Government and corporate debentures - floating interest rate Less Than A Year[Member] | ||
Amortized cost | 34,967 | 3,003 |
Gross unrealized gains | 10 | 1 |
Gross unrealized losses | (1) | |
Fair value | 34,977 | 3,003 |
More Than A Year Through Five Years [Member] | ||
Amortized cost | 533,115 | 176,760 |
Gross unrealized gains | 3,912 | 612 |
Gross unrealized losses | (150) | (74) |
Fair value | 536,877 | 177,298 |
Government and corporate debentures - fixed interest rate More Than A Year Through Five Years [Member] | ||
Amortized cost | 494,520 | 135,040 |
Gross unrealized gains | 3,821 | 595 |
Gross unrealized losses | (143) | (65) |
Fair value | 498,198 | 135,570 |
Government-sponsored enterprises More Than A Year Through Five Years [Member] | ||
Amortized cost | 21,264 | 17,579 |
Gross unrealized gains | 67 | 9 |
Gross unrealized losses | (3) | |
Fair value | 21,331 | 17,585 |
Government and corporate debentures - floating interest rate More Than A Year Through Five Years [Member] | ||
Amortized cost | 17,331 | 24,141 |
Gross unrealized gains | 24 | 8 |
Gross unrealized losses | (7) | (6) |
Fair value | $ 17,348 | $ 24,143 |
PREPAID EXPENSES AND OTHER CU_3
PREPAID EXPENSES AND OTHER CURRENT ASSETS (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Government authorities | $ 7,381 | $ 3,548 |
Hedging transaction asset | 7,083 | 1,465 |
Prepaid expenses | 13,984 | 8,468 |
Other current assets | 12,218 | 5,730 |
Total prepaid expenses and other current assets | $ 40,666 | $ 19,211 |
PROPERTY AND EQUIPMENT, NET (De
PROPERTY AND EQUIPMENT, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Cost | $ 77,611 | $ 64,920 | |
Less accumulated depreciation | 41,748 | 33,214 | |
Depreciated cost | 35,863 | 31,706 | |
Depreciation | 14,610 | 12,126 | $ 8,724 |
Reduction to the cost and accumulated depreciation of fully depreciated equipment no longer in use | 5,923 | 2,841 | |
Leasehold improvements [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 41,101 | 34,831 | |
Computers, peripheral equipment and electronic equipment | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 27,449 | 22,534 | |
Internal use software [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 2,467 | 1,891 | |
Office furniture and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Cost | 6,464 | 5,664 | |
Vehicles [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Cost | $ 130 |
BUSINESS COMBINATION (Narrative
BUSINESS COMBINATION (Narrative) (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
Feb. 29, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | ||||
Cash consideration | $ 6,626 | |||
InkFrog, Inc. [Member] | ||||
Business Acquisition [Line Items] | ||||
Percentage acquired | 100.00% | |||
Cash consideration | $ 10,000 | |||
Escrow Deposit | $ 3,500 | |||
Acquisition related expense | 4,200 | |||
Professional consulting | $ 200 |
BUSINESS COMBINATION (Schedule
BUSINESS COMBINATION (Schedule of Fair Values of Assets Acquired and Liabilities Assumed) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Feb. 29, 2020 | Dec. 31, 2019 |
Business Acquisition [Line Items] | |||
Goodwill | $ 24,235 | $ 17,800 | |
InkFrog, Inc. [Member] | |||
Business Acquisition [Line Items] | |||
Trade receivables | $ 226 | ||
Prepaid expenses and other current assets | 361 | ||
Intangible assets | 2,016 | ||
Goodwill | 4,936 | ||
Total Assets | 7,539 | ||
Current liabilities | 461 | ||
Deferred tax liability | 452 | ||
Total Liabilities | 913 | ||
Total purchase price allocation,net of cash acquired | $ 6,626 |
BUSINESS COMBINATION (Schedul_2
BUSINESS COMBINATION (Schedule of Identifiable Assets as of Date of Acquisition) (Details) - InkFrog, Inc. [Member] $ in Thousands | 1 Months Ended |
Feb. 29, 2020USD ($) | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total purchased intangible assets | $ 2,016 |
Technology [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total purchased intangible assets | $ 1,338 |
Weighted average useful life | 8 years |
Customer Relations [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total purchased intangible assets | $ 387 |
Weighted average useful life | 7 years |
Distribution agreement [Member] | |
Acquired Finite-Lived Intangible Assets [Line Items] | |
Total purchased intangible assets | $ 291 |
Weighted average useful life | 1 year 6 months |
INTANGIBLE ASSETS, NET (Schedul
INTANGIBLE ASSETS, NET (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cost: | |||
Intangible assets, gross | $ 33,554 | $ 31,537 | |
Less accumulated amortization | 14,273 | 11,696 | |
Intangible assets, net | 19,281 | 19,841 | |
Amortization expense | 2,577 | 4,588 | $ 2,784 |
DeviantArt's technology [Member] | |||
Cost: | |||
Amortization expense | 1,206 | ||
Technology [Member] | |||
Cost: | |||
Intangible assets, gross | 9,614 | 8,275 | |
Customer Relations [Member] | |||
Cost: | |||
Intangible assets, gross | 11,054 | 10,667 | |
Customer data [Member] | |||
Cost: | |||
Intangible assets, gross | 12,043 | 12,043 | |
Domain [Member] | |||
Cost: | |||
Intangible assets, gross | 552 | 552 | |
Distribution agreement [Member] | |||
Cost: | |||
Intangible assets, gross | $ 291 |
INTANGIBLE ASSETS, NET (Sched_2
INTANGIBLE ASSETS, NET (Schedule of Estimated Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Estimated amortization expense | ||
2021 | $ 2,278 | |
2022 | 2,087 | |
2023 | 1,790 | |
2024 | 1,732 | |
Thereafter | 11,394 | |
Intangible assets, net | $ 19,281 | $ 19,841 |
ACCRUED EXPENSES AND OTHER CU_3
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Other Liabilities, Current [Abstract] | ||
Accrued expenses | $ 40,649 | $ 36,154 |
Government authorities | 26,008 | 17,584 |
Hedging transaction liability | 1,961 | 696 |
Uncertain tax positions | 1,811 | 2,030 |
Total accrued expenses and other current liabilities | $ 70,429 | $ 56,464 |
CONVERTIBLE NOTES (Narrative) (
CONVERTIBLE NOTES (Narrative) (Details) $ / shares in Units, $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($)$ / shares | |
2025 Convertible notes [Member] | |
Principal amount | $ 575,000 |
Coupon rate | 0.00% |
Maturity date | Feb. 15, 2025 |
Conversion rate | $ / shares | $ 2.4813 |
Carrying amount of equity component representing conversion option | $ 116,521 |
Effective interest rate | 5.21% |
Debt issuance costs | $ 15,712 |
Issuance costs attributable to liability component | 12,528 |
2025 Convertible notes [Member] | Third Party Consultants [Member] | |
Debt issuance costs | 3,184 |
2025 Convertible notes [Member] | Ordinary shares [Member] | |
Principal amount | $ 1,000 |
Conversion rate | $ / shares | $ 403.01 |
2023 Convertible note [Member] | |
Principal amount | $ 442,750 |
Coupon rate | 0.00% |
Maturity date | Jan. 1, 2023 |
Conversion rate | $ / shares | $ 7.0113 |
Carrying amount of equity component representing conversion option | $ 105,375 |
Effective interest rate | 6.20% |
Debt issuance costs | $ 11,511 |
Issuance costs attributable to liability component | 9,602 |
Equity issuance costs | 2,999 |
2023 Convertible note [Member] | Third Party Consultants [Member] | |
Debt issuance costs | 1,090 |
2023 Convertible note [Member] | Ordinary shares [Member] | |
Principal amount | $ 1,000 |
Conversion rate | $ / shares | $ 142.63 |
2025 Capped Call [Member] | |
Aggregate amount | $ 46,000 |
2023 Capped Call [Member] | |
Aggregate amount | $ 45,338 |
CONVERTIBLE NOTES (Schedule of
CONVERTIBLE NOTES (Schedule of Net Carrying Amount) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net carrying value | $ 834,440 | $ 358,715 | |
Amortization of debt discount and issuance costs | 29,954 | 20,938 | $ 10,004 |
2025 Convertible notes [Member] | |||
Principal outstanding | 575,000 | ||
Unamortized debt discount | (109,655) | ||
Unamortized debt issuance costs | (11,766) | ||
Net carrying value | 453,579 | ||
Amount allocated to conversion option | 116,521 | ||
Less: allocated issuance costs | (3,184) | ||
Equity component, net | 113,337 | ||
Amortization of debt discount and issuance costs | 7,629 | ||
2023 Convertible note [Member] | |||
Principal outstanding | 442,750 | 442,750 | |
Unamortized debt discount | (57,435) | (77,527) | |
Unamortized debt issuance costs | (4,275) | (6,508) | |
Converted to shares | (179) | ||
Net carrying value | 380,861 | 358,715 | |
Amount allocated to conversion option | 105,375 | 105,375 | |
Less: allocated issuance costs | (2,999) | (48,337) | |
Converted to shares | 179 | ||
Equity component, net | 102,555 | 57,038 | |
Amortization of debt discount and issuance costs | $ 22,325 | $ 20,938 |
LEASE (Narrative) (Details)
LEASE (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating leases | $ 506 | $ 658 |
Operating lease commitment amount | $ 167 | |
Operating lease term | 10 years | |
Operating lease term extend | 15 years |
LEASE (Schedule of Components o
LEASE (Schedule of Components of Lease Cost) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Lease cost: | ||
Fixed cost and variable payments that depend on an index or rate | $ 21,104 | $ 16,995 |
Short-term lease cost | 1,854 | 1,031 |
Total operating lease cost | $ 22,958 | $ 18,026 |
LEASE (Schedule of Supplemental
LEASE (Schedule of Supplemental Cash Flow Information) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash flows from operating leases | $ (19,061) | $ (15,376) |
Weighted average remaining operating lease | 6 years 6 months 25 days | 7 years 9 months 14 days |
Weighted average discount rate operating lease | 4.10% | 4.80% |
LEASE (Schedule of Future Minim
LEASE (Schedule of Future Minimum Lease Payments of Operating Lease Liabilities) (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Lessee Disclosure [Abstract] | |
2021 | $ 23,186 |
2022 | 20,461 |
2023 | 14,786 |
2024 | 11,670 |
2025 | 10,315 |
After 2026 | 33,227 |
Total operating lease payments | 113,645 |
Less: imputed interest | 17,122 |
Present value of lease liabilities | $ 96,523 |
COMMITMENTS AND CONTINGENT LI_2
COMMITMENTS AND CONTINGENT LIABILITIES (Narrative) (Details) $ in Thousands | Dec. 31, 2020USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Guarantee obligation amount | $ 715 |
SHAREHOLDERS' EQUITY (Narrative
SHAREHOLDERS' EQUITY (Narrative) (Details) $ in Thousands | 12 Months Ended |
Dec. 31, 2020USD ($)shares | |
Stockholders Equity Note [Line Items] | |
Unrecognized compensation cost | $ | $ 352,079 |
Weighted-average period for unrecognized compensation cost to be recognized | 2 years 6 months |
Employee Shares Incentive Plan ("the Plan") [Member] | Employee Stock Option [Member] | |
Stockholders Equity Note [Line Items] | |
Shares available for future grant | shares | 1,819,295 |
SHAREHOLDERS' EQUITY (Schedule
SHAREHOLDERS' EQUITY (Schedule of Stock-Based Compensation) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | $ 147,313 | $ 109,337 | $ 72,330 |
Cost of Revenues [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | 9,127 | 5,854 | 4,418 |
Research and Development Expense [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | 76,882 | 56,161 | 39,417 |
Sales and Marketing Expense [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | 22,845 | 18,458 | 9,770 |
General and Administrative Expense [Member] | |||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | |||
Total share-based compensation expense | $ 38,458 | $ 28,864 | $ 18,725 |
SHAREHOLDERS' EQUITY (Summary O
SHAREHOLDERS' EQUITY (Summary Of Employee Options Activity) (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Number of options | ||
Outstanding, balance | 7,438,119 | |
Granted | 715,247 | |
Exercised | (3,493,875) | |
Forfeited | (41,111) | |
Outstanding, balance | 4,618,380 | 7,438,119 |
Exercisable options at the end of the year | 2,844,347 | |
Options vested and expected to vest at the end of the year | 4,530,353 | |
Weighted average exercise price | ||
Outstanding, weighted average exercise price | $ 37.53 | |
Granted, weighted average exercise price | 155.62 | |
Exercised, weighted average exercise price | 12.59 | |
Forfeited, weighted average exercise price | 80.18 | |
Outstanding, weighted average exercise price | 74.31 | $ 37.53 |
Exercisable, weighted average exercise price | 50.61 | |
Options vested and expected to vest at the end of the year | $ 73.56 | |
Additional Disclosures | ||
Outstanding, weighted average remaining contractual term | 6 years 8 months 26 days | 5 years 5 months 26 days |
Exercisable, weighted average remaining contractual term | 5 years 9 months 18 days | |
Options vested and expected to vest, weighted average remaining contractual term | 6 years 8 months 15 days | |
Outstanding at the beginning of the year, aggregate intrinsic value | $ 812,500 | $ 631,994 |
Exercisable, aggregate intrinsic value | 567,048 | |
Options vested and expected to vest at the end of the year, aggregate intrinsic value | $ 800,307 |
SHAREHOLDERS' EQUITY (Schedul_2
SHAREHOLDERS' EQUITY (Schedule of Stock Option Valuation Assumptions) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Employee Stock Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility, minimum | 42.26% | 42.60% | 45.19% |
Expected volatility, maximum | 49.24% | 45.24% | 46.64% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Risk free rate, minimum | 0.25% | 1.51% | 2.59% |
Risk free rate, maximum | 1.40% | 2.47% | 3.03% |
Employee Stock Option [Member] | Minimum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 4 years 10 months 2 days | 4 years 11 months 8 days | 5 years 2 months 1 day |
Employee Stock Option [Member] | Maximum [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 4 years 11 months 26 days | 4 years 11 months 26 days | 7 years 6 months 10 days |
Equity Option [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility, minimum | 34.52% | 31.88% | 39.90% |
Expected volatility, maximum | 83.30% | 54.49% | 41.20% |
Expected dividends | 0.00% | 0.00% | 0.00% |
Expected term | 6 months | 6 months | 6 months |
Risk free rate, minimum | 0.13% | 1.89% | 1.85% |
Risk free rate, maximum | 0.95% | 2.52% | 2.28% |
SHAREHOLDERS' EQUITY (Summary_2
SHAREHOLDERS' EQUITY (Summary of Options Data) (Details) - Employee Stock Option [Member] - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Weighted-average grant date fair value of options granted | $ 68.91 | $ 53.67 | $ 34.93 |
Total intrinsic value of the options exercised | $ 436,187 | $ 128,003 | $ 137,448 |
Total fair value of shares vested | $ 40,367 | $ 33,316 | $ 27,629 |
SHAREHOLDERS' EQUITY (Schedul_3
SHAREHOLDERS' EQUITY (Schedule Of Options Outstanding and Exercisable by Exercise Price) (Details) | 12 Months Ended |
Dec. 31, 2020shares | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 4,618,380 |
Weighted average remaining contractual life | 6 years 8 months 26 days |
Number of exercisable options outstanding | 2,844,347 |
Weighted average remainging contractual life of options | 5 years 9 months 18 days |
Employee Stock Option [Member] | 0-19.79 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 451,409 |
Weighted average remaining contractual life | 2 years 10 months 28 days |
Number of exercisable options outstanding | 442,098 |
Weighted average remainging contractual life of options | 2 years 9 months 18 days |
Employee Stock Option [Member] | 19.8-21.13 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 586,121 |
Weighted average remaining contractual life | 4 years 8 months 1 day |
Number of exercisable options outstanding | 586,121 |
Weighted average remainging contractual life of options | 4 years 8 months 1 day |
Employee Stock Option [Member] | 21.14-51.32 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 326,467 |
Weighted average remaining contractual life | 5 years 2 months 1 day |
Number of exercisable options outstanding | 300,362 |
Weighted average remainging contractual life of options | 5 years 1 month 2 days |
Employee Stock Option [Member] | 51.33-56.61 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 451,958 |
Weighted average remaining contractual life | 6 years 1 month 13 days |
Number of exercisable options outstanding | 404,324 |
Weighted average remainging contractual life of options | 6 years 1 month 13 days |
Employee Stock Option [Member] | 56.62-61.75 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 741,489 |
Weighted average remaining contractual life | 7 years 1 month 13 days |
Number of exercisable options outstanding | 430,890 |
Weighted average remainging contractual life of options | 7 years 1 month 13 days |
Employee Stock Option [Member] | 61.76-101.67 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 407,639 |
Weighted average remaining contractual life | 7 years 6 months 25 days |
Number of exercisable options outstanding | 218,296 |
Weighted average remainging contractual life of options | 7 years 4 months 20 days |
Employee Stock Option [Member] | 101.68-102.67 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 736,632 |
Weighted average remaining contractual life | 8 years 1 month 13 days |
Number of exercisable options outstanding | 305,214 |
Weighted average remainging contractual life of options | 8 years 1 month 13 days |
Employee Stock Option [Member] | 102.68-142.09 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 266,061 |
Weighted average remaining contractual life | 8 years 6 months 18 days |
Number of exercisable options outstanding | 88,162 |
Weighted average remainging contractual life of options | 8 years 4 months 6 days |
Employee Stock Option [Member] | 142.1-143.13 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 544,383 |
Weighted average remaining contractual life | 9 years 1 month 20 days |
Number of exercisable options outstanding | 57,108 |
Weighted average remainging contractual life of options | 9 years 1 month 20 days |
Employee Stock Option [Member] | 143.14-286.29 [Member] | |
Share-based Payment Arrangement, Option, Exercise Price Range [Line Items] | |
Options Outstanding | 106,221 |
Weighted average remaining contractual life | 9 years 6 months 3 days |
Number of exercisable options outstanding | 11,772 |
Weighted average remainging contractual life of options | 9 years 21 days |
SHAREHOLDERS' EQUITY (Options G
SHAREHOLDERS' EQUITY (Options Granted to Non-Employee Consultants) (Details) - Equity Option [Member] - Equity Issuance Date One [Member] | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Options outstanding | 3,400 |
Exercise price | $ / shares | $ 2.34 |
Exercisable | 3,400 |
Exercisable Through | Jan. 9, 2023 |
SHAREHOLDERS' EQUITY (Schedul_4
SHAREHOLDERS' EQUITY (Schedule of Restricted Stock Unit Activity) (Details) - Restricted Stock Units (RSUs) [Member] | 12 Months Ended |
Dec. 31, 2020$ / sharesshares | |
Number of shares | |
Unvested as of December 31, 2019 | shares | 2,124,430 |
Granted | shares | 1,054,030 |
Vested | shares | (956,651) |
Forfeited | shares | (143,382) |
Unvested as of December 31, 2020 | shares | 2,078,427 |
Weighted average grant date fair value | |
Unvested as of December 31, 2019 | $ / shares | $ 98.50 |
Granted | $ / shares | 199.80 |
Vested | $ / shares | 93.16 |
Forfeited | $ / shares | 120.44 |
Unvested as of December 31, 2020 | $ / shares | $ 150.87 |
INCOME TAXES (Narrative) (Detai
INCOME TAXES (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Line Items] | |||
Corporate income tax rate | 23.00% | 23.00% | 23.00% |
Income tax expense for US tax purpose | $ 15,000 | ||
Minimum [Member] | |||
Income Tax Disclosure [Line Items] | |||
Corporate income tax rate | 22.00% | 21.00% | |
Maximum [Member] | |||
Income Tax Disclosure [Line Items] | |||
Corporate income tax rate | 35.00% | ||
Domestic Country [Member] | |||
Income Tax Disclosure [Line Items] | |||
Operating loss carry-forwards | $ 248,203 | ||
Capital loss carry-forwards | 5 | ||
Foreign Country [Member] | |||
Income Tax Disclosure [Line Items] | |||
Operating loss carry-forwards | 208,146 | ||
Capital loss carry-forwards | $ 5 |
INCOME TAXES (Income (Loss) Bef
INCOME TAXES (Income (Loss) Before Taxes on Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Domestic | $ (151,460) | $ (85,369) | $ (50,679) |
Foreign | 1,295 | 1,553 | 16,766 |
Loss before taxes on income | $ (150,165) | $ (83,816) | $ (33,913) |
INCOME TAXES (Deferred Income T
INCOME TAXES (Deferred Income Taxes) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 | |
Deferred tax assets: | |||
Net operating loss carryforwards | $ 30,481 | $ 19,362 | |
Capital losses carry-forwards | 1 | 54 | |
Operating lease liabilities | 16,495 | 15,197 | |
Research and development expenses carryforward | 1,742 | 2,093 | |
Share-based compensation | 18,242 | 12,955 | |
Depreciation differences | 582 | 1,082 | |
Accrued employees costs | 3,506 | 1,774 | |
Intra-entity intellectual property transfer | [1] | 1,835 | |
Intangible assets | 358 | ||
Tax advances | 4,032 | 3,353 | |
Other | 139 | 189 | |
Deferred tax assets | 75,578 | 57,894 | |
Deferred tax liabilities: | |||
Convertible notes | 19,415 | 8,990 | |
Other financial income | 15,343 | ||
Property and equipment | 1,740 | 299 | |
Operating lease ROU assets | 14,999 | 14,401 | |
Acquired Intangible assets | 1,880 | 1,831 | |
Share-based compensation | |||
Other | 1,574 | 209 | |
Deferred tax liabilities | 54,951 | 25,730 | |
Valuation allowance | (6,797) | (30,470) | |
Long term receivables [Member] | |||
Deferred tax assets: | |||
Deferred tax assets | 1,813 | 14,730 | |
Long term liabilities [Member] | |||
Deferred tax liabilities: | |||
Deferred tax liabilities | $ 15,643 | $ 13,036 | |
[1] | During 2019, the Company completed an intra-entity transfer from US to Israel of certain intangible property |
INCOME TAXES (Schedule of Curre
INCOME TAXES (Schedule of Current and Deferred Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Current | $ (535) | $ 3,309 | $ 4,188 |
Deferred | 15,524 | (711) | (981) |
Domestic | 16,193 | (1,981) | 1,140 |
Foreign | (1,205) | 4,579 | 2,067 |
Income tax expenses | $ 14,989 | $ 2,598 | $ 3,207 |
INCOME TAXES (Reconciliation of
INCOME TAXES (Reconciliation of Income Tax Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Loss before taxes on income | $ (150,165) | $ (83,816) | $ (33,913) |
Statutory tax rate | 23.00% | 23.00% | 23.00% |
Theoretical income tax expense | $ (34,538) | $ (19,278) | $ (7,800) |
Deferred tax assets for which valuation allowance was provided | 29,485 | 8,749 | (1,925) |
Non-deductible option expenses | (5,529) | (443) | 12,609 |
Non-deductible expenses | 627 | 2,280 | 824 |
Tax adjustment in respect of different tax rate of foreign subsidiary | 345 | (249) | (1,627) |
Preferred enterprise benefits | 23,700 | 9,732 | |
Rate change impact | (57) | (93) | (174) |
Intra-entity intellectual property transfer | 196 | ||
Different tax rate | 372 | 463 | |
Foreign Tax | 102 | 1,182 | |
Other | 584 | 1,139 | 118 |
Income tax expenses | $ 14,989 | $ 2,598 | $ 3,207 |
INCOME TAXES (Schedule of recon
INCOME TAXES (Schedule of reconciliation of the opening and closing amounts of total unrecognized tax benefits) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Opening balance | $ 2,030 | $ 334 | $ 1,378 |
Increases (decrease) related to previous and current year tax positions | (219) | 1,696 | (1,044) |
Closing balance | $ 1,811 | $ 2,030 | $ 334 |
FINANCIAL INCOME, NET (Details)
FINANCIAL INCOME, NET (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Nonoperating Income (Expense) [Abstract] | ||||
Bank charges | $ (539) | $ (533) | $ (310) | |
Income (expenses) related to hedging activity | (5,529) | 963 | 1,435 | |
Amortization of debt discount and issuance costs | (29,954) | (20,938) | (10,004) | |
Exchange rate loss | (2,352) | (2,905) | (3,522) | |
Other financial income | [1] | 69,042 | ||
Total expenses | 30,668 | (23,413) | (12,401) | |
Interest income | 16,391 | 19,792 | 9,607 | |
Total financial income (expenses), net | 47,059 | $ (3,621) | $ (2,794) | |
Amount appreciation of valuation related to holdings in a privately held | $ 66,709 | |||
[1] | This includes $66,709 of appreciation of valuation related to holdings in a privately held company, which the Company has held since 2012. |
BASIC AND DILUTED NET LOSS PE_3
BASIC AND DILUTED NET LOSS PER SHARE (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |||
Net loss available to shareholders of ordinary shares | $ (165,154) | $ (86,414) | $ (37,120) |
Denominator: | |||
Shares used in computing net loss per ordinary shares, basic and diluted | 54,425,056 | 50,504,698 | 48,017,188 |
BASIC AND DILUTED NET LOSS PE_4
BASIC AND DILUTED NET LOSS PER SHARE (Summary of Reconciliation of Basic Weighted Average Number of Shares) (Details) - shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings Per Share [Abstract] | |||
Shares used in computing net loss per ordinary shares, basic and diluted | 54,425,056 | 50,504,698 | 48,017,188 |
The following items have been excluded from the diluted weighted average number of shares outstanding because they are anti-dilutive: | |||
Stock options | 4,621,780 | 7,447,519 | 7,676,713 |
Restricted share units | 2,078,427 | 2,125,440 | 2,090,512 |
Convertible Notes | 4,428,999 | 3,104,251 | 3,104,251 |
Outstanding options and RSU's excluded from the calculation of the diluted net loss per share | 11,129,206 | 12,677,210 | 12,871,476 |
SEGMENTS, CUSTOMERS AND GEOGR_3
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION (Revenues by Geographical Areas from External Customers) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 988,760 | $ 761,088 | $ 603,704 | |
America [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | [1] | 563,824 | 414,775 | 316,446 |
Europe and Asia [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 251,597 | 195,324 | 159,768 | |
Latin America [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 51,053 | 51,108 | 46,232 | |
Asia and others [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 122,286 | 99,881 | 81,258 | |
USA [Member] | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 481,098 | $ 363,431 | $ 278,784 | |
[1] | Include revenue from USA in amount of $278,784, $363,431 and $481,098 for 2018, 2019 and 2020, respectively. |
SEGMENTS, CUSTOMERS AND GEOGR_4
SEGMENTS, CUSTOMERS AND GEOGRAPHIC INFORMATION (Schedule of Long-lived Assets by Geographical Areas) (Details) - USD ($) $ in Thousands | Dec. 31, 2020 | Dec. 31, 2019 |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets and ROU | $ 124,268 | $ 110,955 |
Israel [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets and ROU | 56,684 | 40,147 |
Europe and Asia [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets and ROU | 15,233 | 13,609 |
America [Member] | ||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||
Long-lived assets and ROU | $ 52,352 | $ 57,200 |