When a small shop owner or a startup founder can "vibe code" a fully functional website in a matter of hours, life gets considerably harder for companies that built their entire business on being the easy option. Wix.com Ltd. (WIX) watched its stock nosedive 27.1% on Wednesday, May 13, after delivering a quarterly earnings report that left Wall Street with more questions than answers.
The company pinned the wide earnings miss on heavy investments in its Base44 app-building platform and a marketing bill that ballooned nearly 50% year-over-year (YOY) to $167.8 million. Now, to stay in the game, Wix has been weaving artificial intelligence (AI) into its own products. Base44, which drew unusually strong demand during the quarter, runs on AI at its core.
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In addition, the company went a step further and built its own proprietary large language model (LLM), trained on internal data and real user feedback. CEO Avishai Abrahami noted the company expects this homegrown LLM to sharpen its competitive edge and rein in AI costs, operating with "little to no reliance on third party LLMs."
However, the ambition carries a price tag with no guaranteed return attached. Every user who taps into Wix's AI tools consumes compute bandwidth, which means rising demand translates directly into higher infrastructure costs for the company. Wix management argues these costs will load up heavily at the front and ease off steadily over time, though the market is clearly not taking that assurance at face value just yet.
About Wix Stock
Based in Tel Aviv-Yafo, Israel, Wix.com is a global, cloud-based website building platform. The company offers a toolkit that spans drag and drop design, AI powered creation tools, full e-commerce functionality, and no code app development, all packaged within a freemium model that allows users to get started for free before upgrading to paid tiers.
Despite the scale, the stock tells a painful story for anyone who has held it over the past year. Shares of the $3.23 billion market cap web development platform collapsed 72% over the last 52-week period as investors priced in the threat that AI-native tools pose to the company's bread-and-butter business.
The bleeding did not stop in 2026 either. Year-to-date (YTD), WIX stock has already fallen 48.86%. In fact, the stock's five most recent trading sessions dealt another 33.87% blow, driven largely by the disappointing quarterly earnings results.
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www.barchart.com For those inclined to look at the numbers through the lens of value, WIX stock is currently trading at 46.69 times forward adjusted earnings and 1.42 times sales.
Wix Misses on Q1 Earnings
Wix published its Q1 FY2026 earnings report on May 13, in which revenue during the quarter came in at $541.2 million, growing 14.3% YOY, but it still fell short of the $544 million Wall Street had penciled in. Adjusted EPS plunged 56.1% from the year-ago value to $0.68 and missed the $1.24 analysts had expected.
Total annual recurring revenue (ARR) reached $1.9 billion at the close of Q1 2026, up 15% YOY. Total bookings for the quarter landed at $585 million, also growing 15% YOY. Creative Subscriptions bookings climbed 13% YOY contributing $418.8 million, while Business Solutions bookings added $166.2 million and grew 18% from the prior year’s period.
Stripping out acquisition-related costs, free cash flow for Q1 would have reached $112.3 million, equal to 21% of revenue. Looking ahead, Wix holds firm on its full year FY2026 outlook, maintaining expectations for both bookings and revenue to grow at a mid-teens percentage year over year. The company extends the same guidance to Q2 FY2026, projecting mid-teens revenue growth YOY.
The picture for earnings in the near term, however, looks considerably rougher. Analysts currently project FY2026 EPS to fall 51.8% YOY to $1.63. The silver lining sits further out, with FY2027 EPS expected to bounce back decisively, growing 95.1% YOY to $3.18.
What Do Analysts Expect for Wix Stock?
Wall Street's collective verdict on WIX stock settles at a "Moderate Buy." Among the 23 analysts tracking the stock, 14 have stamped it a "Strong Buy," three sit at "Moderate Buy," five call for a "Hold," and one has flagged it as a "Strong Sell."
To that end, the average price target of $117.55 points to a potential upside of 122.4%. Meanwhile, the Street-High target of $180 suggests the stock could run as much as 240.6% from current levels.
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www.barchart.com On the date of publication, Aanchal Sugandh did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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