Wix revises down revenue forecast; The stock is falling

Wix allows its users to build and manage websites. Last month, the company issued a forecast in which it expected to show “mid-teens” (ie around 15%) growth in orders in 2026, and similar growth in revenues at the annual level and in the second quarter of the year. Now she updates that annual orders will grow at a rate of “Low-Teens”, meaning a low double-digit rate, and revenues will grow at a rate between Low and Mid, meaning between a low double-digit rate and around 15%. The free flow will amount to $420 million this year, an increase of about $20 million compared to the previous plan, and Wix explains this by focusing on profitable growth.

Reorganization and slowdown in the growth of the partners’ business

According to the report, Base44 – the vibe-coding platform that the company acquired last year – as well as the company’s ‘Harmony’ platform continue to perform according to the recently published forecast. Despite this, “the company anticipates a drop of about $50 million in orders and about $25 million in revenue in 2026,” compared to the previous forecast, for two main reasons.

The first is the reorganization process in which Wix laid off about 20% of its employees, and the second is a more significant slowdown, beyond early expectations, in the growth of Wix’s partner business also in May and early June. These businesses were also the weak link in the company’s first quarter reports. In the first quarter, Wix registered a slowdown in growth, and revenue from partners accounted for 38% of total revenue, approximately $203 million. The company explained this as a deliberate decrease in the marketing efforts of a product for the field, in preparation for the launch of its next generation.

In today’s report, Wix states that the lower-than-expected performance in the top line will be offset, and even more so, by the amount of approximately 70 million dollars, which are (Non-GAAP) costs related to the layoffs, and were not taken into account in the previous forecast. “The full annual savings rate is expected to be about 150 million dollars,” the company updates.

Wix is ​​expected to record costs of 30-35 million dollars before tax due to the organizational change, and most of them will be costs related to severance pay and related benefits. Most of the recognition will be in the second quarter of the year.

Wix, under the management of Avishi Abrahami, is traded on Nasdaq at a value of 2.2 billion dollars.