Wix Pours More Money Into AI, Cuts Cash Flow Outlook

Wix.com Ltd. (NASDAQ:WIX) stock was little changed in premarket trading Tuesday after falling 8.33% in the previous session.

The Israel-based website-building software company reported better-than-expected third-quarter results and reaffirmed its full-year revenue outlook.

Wix Beats Earnings and Revenue Estimates

Wix reported adjusted earnings of $1.42 per share, beating the Wall Street estimate of $1.39.

Revenue rose 13% year over year to $570.17 million, topping the analyst estimate of $565.98 million.

Total bookings increased 11% to $573 million. Annual recurring revenue climbed 15% to $2.02 billion.

Creative Subscriptions revenue grew 14% to $406.7 million, while Business Solutions revenue rose 10% to $163.5 million. Partners revenue increased 11% to $212.4 million.

Wix Reports Stable Margins, Strong Cash Flow

Adjusted gross margin held steady at 69%, supported by Wix’s proprietary AI model, Base 1.

Operating cash flow reached $78.3 million, while free cash flow totaled $74.5 million.

Wix ended September with approximately $1.05 billion in cash, short-term deposits and marketable securities, alongside $1.63 billion in debt.

AI Investments Drive Growth

CEO Avishai Abrahami said Base44 continues to outperform expectations as Wix expands its AI investments.

He also highlighted Wix Studio Two, which combines AI-powered website creation, visual design and React coding.

CFO Lior Shemesh said Base44’s annual recurring revenue is approaching $250 million, supported by customer growth and improving retention.

Wix expects Base44’s adjusted gross margin to exceed 60% by year-end as AI costs decline.

The company also named Nir Zohar co-CEO. Zohar will oversee strategy and operations, while Abrahami focuses on AI, products and technology.

Wix Maintains Revenue Outlook, Cuts Cash Flow Forecast

Wix expects fourth-quarter revenue to grow by a low-double-digit percentage.

The company reaffirmed its 2026 outlook, forecasting revenue growth in the low- to mid-teens and bookings growth in the low teens.

However, Wix lowered its free cash flow margin forecast to approximately 16%, excluding acquisition-related and restructuring costs, from its previous high-teens forecast.

The reduction reflects higher sales and marketing spending to accelerate Base44’s growth.

WIX Stock Price Action

WIX Price Action: Wix.com shares were up 0.29% at $69.95 during premarket trading on Tuesday, according to Benzinga Pro data.

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