Wix Stock Drops 50% as 1,000 Job Cuts Signal Deeper Trouble after Earnings

TLDR

• Wix is cutting around 1,000 jobs — about 20% of its workforce — in what would be its largest layoff ever.
• The move follows a Q1 earnings miss that wiped a third of the stock’s value in a single day; WIX is down ~50% year-to-date.
• Q1 showed a $57.5 million loss despite a 14% revenue rise to $541 million, with operating expenses jumping 50%.
• AI platform Base44, acquired for $80 million, is growing fast — hitting $150 million ARR in May — but is adding major costs.
• Wix spent $1.6 billion on a share buyback that has so far failed to reassure investors.

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Wix reported a first-quarter loss of $57.5 million, a sharp reversal after several profitable quarters. Revenue climbed 14% to $541 million, but operating expenses surged 50% to $423 million. Cash flow dropped 21% to $112 million.

Wix.com Ltd., WIX

The stock has lost nearly 50% of its value since January. After the Q1 results dropped last week, it shed another third of its value in a single session.

Now the cuts are coming. Wix is preparing to lay off around 1,000 employees — roughly 20% of its total headcount of 5,277. More than 60% of its staff are based in Israel.

The company pointed to AI as a driver of the restructuring. As AI tools take on more development and design work, several roles are simply becoming redundant.

Earlier this year, management ordered a return to full-time office work, which met strong internal resistance. In Q1, the workforce only shrank by 63 people. The upcoming layoffs mark a much harder shift.

Base44: Growth Engine With a Price Tag

Much of Wix’s recent growth story runs through Base44, the vibe-coding platform it acquired for $80 million. Founded by Maor Shlomo, it lets users build software using plain-language prompts.

Base44’s annual recurring revenue hit $150 million in May, well ahead of targets. But that growth comes with a cost. Heavy marketing spend, rising computing costs, and additional acquisition-related payments to Shlomo are all hitting the bottom line.

Wix paid Shlomo $38 million in Q1 alone and expects more payments later this year. The company aired two Super Bowl commercials — one for Wix, one for Base44 — adding to the marketing bill.

Wix is also building its own AI model to power Harmony, its AI website-building tool. CEO Avishai Abrahami says it will improve accuracy and cut inference costs over time, but for now it’s another major expense.

Buyback Fails to Lift Sentiment

In March, Wix launched a $1.6 billion share buyback — nearly clearing out its cash reserves, which fell to $900 million. The move was meant to signal confidence to investors.

It hasn’t worked. The stock continues to slide, weighed down by broader concerns that its core website-building business is losing relevance as AI makes it easier for anyone to spin up a site for a few dollars a month.

Investor anxiety around software stocks has been running high. Wix doesn’t operate as a traditional SaaS business, but it’s been caught in the same negative sentiment wave.

Operating expenses as a share of revenue jumped from 21% in Q1 2025 to 35% in Q1 2026 — a trend that has unsettled the market. Wix’s market cap now stands at around $2 billion.

Base44’s ARR reached $150 million in May 2026, according to the company.