Wix CEO Avishai Abrahami informed employees on May 28 that the company will cut about 20% of staff (about 1,000 positions). This is the largest round of layoffs in Wix’s history. The layoffs were triggered directly by the news on May 13 that its Q1 earnings fell short of expectations. After the news broke, the stock price dropped 1.52% on the 28th to $52.65.
Wix Confirmed Q1 Financial Results and the Stock Drop
Wix confirmed Q1 financial results: revenue of $541 million (up 14% year over year), but net loss of $57.5 million (turning from profit in the prior period), adjusted earnings per share of $0.68 (below the market’s expected $1.22), and the operating expense-to-revenue ratio rising from 21% in Q1 2025 to 35%.
After the May 13 earnings report, Wix’s stock plunged 27% in a single day. Since January 2026, it has fallen by more than 50% in total, and its market capitalization has shrunk to about $2 billion (compared with a peak of nearly $20 billion in 2021).
Wix also confirmed that professional development customers are moving to competitors’ AI tools, and that the new platform Wix Harmony has defects, slowing product update speed.
Wix Confirms the New Post-Layoff Organizational Structure and an AI-Native Competitive Landscape
Abrahami confirmed that, alongside the layoffs, Wix will streamline management layers and introduce two types of AI-native roles: “xEngineer” (a design-first engineering position for employees using AI tools) and “Creator.”
Earlier this year, Wix acquired the AI-native “atmosphere programming” platform Base44 for $80 million (reaching $100 million in annual recurring revenue within about a year), but this acquisition has not eased competitive pressure yet. The AI-native competition Wix faces includes Lovable (currently valued at $1.8 billion) and Bolt.new, both of which can generate websites directly based on natural-language descriptions.
Controversy Around Confirmations of 2026 Tech Layoffs and “AI Whitening”
As of May 2026, the technology industry has already cut more than 134,000 jobs through 212 rounds of layoffs, including Block (about 4,000 people in February), Cisco (5% this month), Meta (about 8,000 people last week), and Oracle (up to 30,000 people).
OpenAI CEO Sam Altman confirmed the existence of “AI whitening”—some companies attribute layoffs to AI, but layoffs would happen even without AI. A joint investigation by Duke University and the Federal Reserve into more than 750 CFOs confirmed that more than 80% of respondents said AI has brought no productivity improvements.
FAQ
What are the two specific reasons for layoffs that Wix CEO confirmed?
Based on Abrahami’s confirmation announcements on X and LinkedIn, the two reasons are: structural pressure on payroll costs caused by the strengthening of the Israeli shekel (up 14% in 2025, and up another 7% in the first five months of 2026); and that AI transformation is reshaping how the company builds, requiring adjustment of the existing organizational scale.
How large is the gap between the confirmed figures in Wix’s Q1 earnings and market expectations?
Adjusted earnings per share of $0.68, below the market’s expected $1.22; net loss of $57.5 million (turning from profit to loss); the operating expense-to-revenue ratio jumping from 21% to 35%. These figures led to a 27% one-day plunge in the stock on the earnings day.
What is the purpose of Wix’s employee headcount after the layoffs and the Base44 acquisition?
Abrahami confirmed that the total number of employees after the layoffs will remain stable at about 4,200, and affected employees will receive tailored severance packages. Wix’s $80 million acquisition of Base44 is intended to respond to AI-native rivals such as Lovable and Bolt.new, but Wix confirmed that the acquisition has not yet eased competitive pressure.
