According to a recent report, the global market for Website Builders is estimated to grow at 9% CAGR to reach $2.7 billion by 2026. New York-based Squarespace (NYSE: SQSP) is focused on helping smaller businesses expand their digital presence through its offerings.

Squarespace’s Financials

In its recent fourth quarter, revenues grew 20% to $207.4 million. Adjusted EBITDA was $33 million.

By segment, revenues from unique subscriptions grew 12% to 4.1 million, while average revenue per unique subscription (ARPUS) grew 9% to $203. Annual Runrate Revenue was up 18% to $835.2 million. Commerce revenues grew 60% to $229.5 million.

For the full fiscal year, revenues grew 26% to $784 million and net loss was $249.1 million.

For the first quarter, Squarespace expects revenues of $203-$205 million. For the fiscal year, it forecast revenues of $862-$878 million. The market expects revenues of $207.42 million for the quarter and $784.04 million for the year.

Squarespace’s Growth

Recently, Squarespace announced the launch of several new products to help customers sell online. It released new tools for marketplace sellers that will allow customers to build their brand by adding integrations to their Etsy shop products and reviews. Customers will be able to create an online store and manage their Etsy shop simultaneously. It also announced a partnership with Tock to provide a seamless experience for time-slotted businesses to manage reservations, events, and to-go orders in one location. Squarespace Scheduling provides businesses with the ability to share their availability on their website, social media, and through email or text for easy management for any appointment or class.

Their biggest announcement though was their foray into the video offerings to compete with players like YouTube, Patreon, and OnlyFans. Squarespace Video Studio App will allow customers to create professional-level videos to promote their business. Content creators will be able to create 30 minutes of video for free, or longer videos for a premium fee. Squarespace will allow users to upload these videos directly to their Squarespace site. These clips will be hosted natively on the platform itself or can be routed in videos from YouTube and Vimeo where necessary. Squarespace is focusing this offering on chefs, instructors, wellness providers, and educators.

Squarespace operates in a highly fragmented market with competitors offering similar products and services. Wix and Weebly, for instance, offer simple DIY website building services. Wix is one of its biggest competitors that has over 200 million users worldwide who have built more than 110 million websites. Wix even offers a free website builder plan that allows users to build an ad-supported website. Squarespace will need to continue to offer additional capabilities, such as video integration, to help it stand apart from the crowd.

Squarespace went public in May last year at a list price of $50.00 and a valuation of $7.4 billion. Before going public, it had raised $578.5 million in four rounds of funding, with the most recent round being held in March of 2021. Its stock is currently trading at $26.56, with a market capitalization of $3.7 billion.