Wix.com Shares Plunge 30% on Q1 Earnings Miss, AI Investment Accelerates
Wix.com’s Q1 revenue rose 14% to $541.2M with bookings up 15% and ARR hitting $1.90B, but earnings missed consensus estimates, driving a nearly 30% share plunge and a 45% YTD decline. The stock now trades at single-digit free-cash-flow multiples despite accelerated AI investments in Base44 and Harmony LLM.
1. Q1 Financial Performance
In Q1, revenue totaled $541.2 million, up 14% year-over-year, with bookings rising 15% and ARR hitting $1.90 billion despite macro headwinds and partner channel challenges.
2. Earnings Miss and Market Reaction
The company missed consensus on adjusted earnings per share and reported declines in gross and operating margins, sparking a nearly 30% intraday share plunge and deepening a 45% year-to-date loss.
3. Valuation on Free Cash Flow
Following the steep sell-off, the stock now trades at single-digit free-cash-flow multiples, reflecting market concerns over profitability and growth sustainability.
4. AI Investments Driving Future Growth
Wix.com is accelerating its AI strategy through its Base44 development platform and the Harmony large language model, aiming to expand its app ecosystem and enhance customer creativity tools.