Wix, an Israel-founded website-building platform, plans to cut about 1,000 jobs in the coming months, or roughly 20% of its workforce, as lower profitability and rising AI-related costs weigh on the business.

The company had 5,277 employees at the end of the first quarter, with more than 60% based in Israel. Management also said AI has driven a more than 40% reduction in Wix’s customer-care headcount since 2022.

Wix posted a US$57.5 million net loss in the quarter after several profitable quarters, even as revenue rose 14% to US$541 million. Cash flow fell 21% to US$112 million, while operating expenses rose 50% to US$423 million.

Part of the pressure is tied to Base44, an AI software-building platform Wix agreed to buy for about US$80 million upfront, plus earn-out payments through 2029.

Management said the margin pressure came from higher investment in Base44 and AI computing costs, but added those costs are front-loaded and could ease over time as Wix deploys its in-house AI model more broadly.

🔗 Source: Calcalist

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