TLDR
- Wix stock hit a 52-week low of $55.88, dropping ~30% on earnings day
- Q1 EPS came in at $0.68, well below the $1.21 consensus estimate
- Revenue grew 14% year-over-year to $541.2 million but missed estimates of $543.8 million
- Wix launched its own AI model, “Wix Harmony,” built on a proprietary large language model
- The company repurchased 17.5 million shares at $92 each in a $1.6 billion Dutch Auction tender offer
Wix.com (WIX) stock dropped nearly 30% on Tuesday after the company posted Q1 2026 results that fell short on both the top and bottom lines. The stock touched a 52-week low of $55.88 before trading around $58.75 by midday.
Q1 non-GAAP EPS came in at $0.68, a sharp miss against the $1.21 consensus estimate. That’s also a steep drop from the $1.55 EPS reported in the same quarter a year ago.
Revenue for the quarter reached $541.2 million, up 14% year-over-year. That missed the $543.8 million estimate, though the growth rate itself remains solid for a company at Wix’s scale.
$WIX Q1’26 EARNINGS HIGHLIGHTS
🔹 Revenue: $541.2M (Est $544.04M) 🔴
🔹 EPS: $0.68 (Est $1.22) 🔴FY26 Guide:
🔹 Revenue Growth: Mid-teens % YoY, maintained
🔹 Bookings Growth: Mid-teens % YoY, maintained— Wall St Engine (@wallstengine) May 13, 2026
Management pointed to geopolitical pressures tied to the ongoing conflict in Israel as a headwind. Productivity disruptions in the Partners business were also called out specifically.
The Partners segment still posted 19% revenue growth to $203.4 million. But management acknowledged the business got off to a slower-than-expected start in the quarter.
AI Push With Wix Harmony
The biggest strategic announcement from the quarter was the launch of “Wix Harmony,” powered by a proprietary large language model the company developed in-house. This marks a shift away from relying on third-party AI tools.
Management described Harmony as the first in a broader suite of Wix-built AI systems. The goal is to build AI capabilities that competitors can’t easily replicate.
Creative Subscriptions revenue, which makes up 70.6% of total revenue, grew 13% year-over-year to $382 million. Business Solutions revenue rose 17% to $159 million.
Annual recurring revenue hit $1.9 billion, up 15% year-over-year. Total bookings came in at $585 million, also up 15%.
One standout: bookings from Q1’s new user cohort were up nearly 50% year-over-year. Management credited “Base44” as a meaningful contributor to that growth.
Massive Share Buyback Completed
In April, Wix completed a modified Dutch Auction tender offer, repurchasing roughly 17.5 million shares at $92 each. The total cost was approximately $1.6 billion.
That reduced the total shares outstanding to around 41.8 million as of May 11, 2026 — a reduction of nearly 30%.
Non-GAAP gross margin came in at 66%, down from 69% in the year-ago quarter. Non-GAAP operating income dropped to $27.8 million from $99.8 million a year ago. Operating margin fell to 5% from 21%.
Cash on the balance sheet stood at $1.34 billion as of March 31, 2026, up from $311.4 million at year-end 2025 — partly reflecting the timing of the tender offer financing.
Free cash flow for the quarter was $75 million. Excluding acquisition-related costs, it would have been $112.3 million, or 21% of revenue.
Wix maintained its full-year outlook for mid-teens revenue growth and mid-teens bookings growth. Free cash flow margins are expected to land in the high-teens due to lower interest income following the cash deployment, interest costs on a $500 million credit facility, and currency headwinds from a stronger Israeli shekel.
Certain product rollouts aimed at professionals were reportedly delayed, which may weigh on near-term growth.
Wix currently holds a Zacks Rank of #3 (Hold).
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