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WIX Q1 Results Lag Estimates, Earnings Slip Y/Y on Geopolitical Woes
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Key Takeaways
Wix reported Q1 revenue growth of 14% to $541.2 million despite missing estimates.
WIX launched a proprietary AI model, "Wix Harmony," to strengthen product innovation and differentiation.
Wix repurchased 17.5 million shares for $1.6 billion, reducing shares outstanding significantly.
Wix.com Ltd (WIX - Free Report) reported non-GAAP earnings per share (EPS) of 68 cents for first-quarter 2026, which missed the Zacks Consensus Estimate of $1.21. The company had reported EPS of $1.55 in the year-ago quarter.
Wix reported first-quarter revenue of $541.2 million, marking a 14% year-over-year increase on the back of healthy revenue growth across key segments. For a company already operating at a large scale, mid-teens growth remains highly commendable, especially considering macroeconomic uncertainties and ongoing geopolitical challenges in Israel. The upside suggests that Wix is successfully monetizing both individual creators and businesses through its commerce, payments and enterprise tools. However, the top line missed the Zacks Consensus Estimate of $543.8 million.
AI has become the central focus of Wix’s strategy. Management announced that the company has developed its own proprietary large language model (LLM), which now powers “Wix Harmony.” WIX described this as the start of a broader suite of Wix-driven AI systems that could become integral to product innovation and profitability. This positioning is significant because the website-building industry is rapidly shifting into an AI-assisted development ecosystem. Companies that only integrate third-party AI tools may struggle to differentiate themselves over time. Wix is aiming to develop proprietary AI moats instead. If successful, this could greatly enhance Wix’s competitive position against rivals and emerging AI-native site builders.
In response to mixed performance trends, shares have plunged 18% in pre-market trading today. WIX's shares have lost 60% compared with the Zacks Computer-IT Services’ fall of 32.2% in the past year.
Image Source: Zacks Investment Research
Quarter in Detail
Creative Subscriptions’ revenues (70.6% of total revenues) increased 13% year over year to $382 million. Business Solutions’ revenues (29.4% of total revenues) rose 17% to $159 million.
Annual recurring revenue (ARR) grew 15% year over year to $1.9 billion, demonstrating the resilience of Wix’s subscription-based business model.
Total bookings reached $585 million, up 15% year over year, suggesting that future revenue pipelines remain strong. The standout metric was the nearly 50% year-over-year increase in bookings from the first quarter's new user cohort. Management credited both strong core business performance and meaningful contributions from “Base44,” which appears to be emerging as a major growth initiative.
Creative Subscriptions’ bookings increased 13% to $418.8 million and Business Solutions’ bookings rose 18% to $166.2 million.
Partners revenue grew 19% to $203.4 million. Management acknowledged a slower-than-expected start in the Partners business, along with productivity disruptions tied to the war in the Middle East.
Region-wise, North America, Europe, Asia and others, and Latin America contributed 61%, 24%, 11% and 4% to first-quarter 2026 revenues, up 12%,9%,16% and 14% year over year, respectively.
At the end of March 31, 2026, registered users were 310 million.
Operating Details
Non-GAAP gross margin was 66% compared with 69% in the prior-year quarter.
Creative Subscriptions segment achieved 80%, and the Business Solutions segment 32%.
Wix reported a non-GAAP operating income of $27.8 million compared with $99.8 million in the year-ago quarter. Non-GAAP operating margin was 5%, down from 21%.
Balance Sheet & Cash Flow
As of March 31, 2026, Wix had cash and cash equivalents of $1.34 billion compared with $311.4 million as of Dec. 31, 2025.
First-quarter cash flow from operations amounted to $78.5 million compared with $145.5 million in the previous-year quarter.
Capital expenditures totaled $3.6 million. Free cash flow was $75 million. Excluding acquisition-related costs, free cash flow would have been $112.3 million, equivalent to 21% of revenue.
A boldest move from Wix this quarter was the completion of its modified Dutch Auction tender offer. In April, the company repurchased approximately 17.5 million shares at $92 each, totaling roughly $1.6 billion. The transaction reduced outstanding shares to approximately 41.8 million as of May 11, 2026. Repurchasing nearly 30% of shares outstanding dramatically boosts future earnings-per-share potential and signals strong management confidence in Wix’s long-term intrinsic value. For long-term investors, this could become highly accretive if Wix maintains double-digit growth while improving AI-driven monetization.
Outlook for 2026 Reaffirmed
Wix maintained its expectation for mid-teens revenue growth, mid-teens bookings growth and high-teens free cash flow margins excluding acquisition costs.
The company also expects second-quarter revenue growth to remain in the mid-teens range.
Certain professional-focused product rollouts have reportedly been delayed, which could temporarily weigh on growth.
Management cautioned that full-year free cash flow margins may land in the high-teens due to reduced interest income after deploying cash toward the tender offer, interest expense from a $500 million credit facility and currency headwinds from a stronger Israeli shekel. Assuming the capital structure before the tender offer is completed and excluding acquisition-related costs, we expect full-year free cash flow margin to remain in the low- to mid-20% range.
CDW Corporation (CDW - Free Report) reported first-quarter 2026 non-GAAP EPS of $2.28, matching the Zacks Consensus Estimate. The bottom line increased approximately 6.3% year over year. CDW reported quarterly net sales of $5.68 billion, representing a 9.2% year-over-year increase. On a constant currency (cc) basis, sales grew 8.4%, reflecting healthy organic demand across the business. Quarterly revenues also surpassed the consensus mark of $5.4 billion.
FUJIFILM Holdings Corporation (FUJIY - Free Report) reported a fourth-quarter fiscal 2025 (ended March 31, 2026) net income of ¥83.4 billion compared with ¥79.4 billion in the year-ago quarter. Revenues of ¥927.3 billion jumped 6.8% year over year. The company generated record fourth-quarter revenues and net income. Revenue growth was primarily driven by the Healthcare segment, supported by contributions from newly launched Bio CDMO facilities in Denmark.
Sensata Technologies Holding plc (ST - Free Report) reported first-quarter 2026 adjusted EPS of 86 cents, up from 78 cents a year ago. The bottom line beat the Zacks Consensus Estimate by 2.4%. Revenues for the quarter reached $934.8 million, up 2.6% from a year ago. The figure came near to the upper end of management’s expectations ($917-$937 million) and beat the consensus estimate by 0.7%. Strength Aerospace, Defense and Commercial Equipment segments drove the top-line performance.
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WIX Q1 Results Lag Estimates, Earnings Slip Y/Y on Geopolitical Woes
Key Takeaways
Wix.com Ltd (WIX - Free Report) reported non-GAAP earnings per share (EPS) of 68 cents for first-quarter 2026, which missed the Zacks Consensus Estimate of $1.21. The company had reported EPS of $1.55 in the year-ago quarter.
Wix reported first-quarter revenue of $541.2 million, marking a 14% year-over-year increase on the back of healthy revenue growth across key segments. For a company already operating at a large scale, mid-teens growth remains highly commendable, especially considering macroeconomic uncertainties and ongoing geopolitical challenges in Israel. The upside suggests that Wix is successfully monetizing both individual creators and businesses through its commerce, payments and enterprise tools. However, the top line missed the Zacks Consensus Estimate of $543.8 million.
AI has become the central focus of Wix’s strategy. Management announced that the company has developed its own proprietary large language model (LLM), which now powers “Wix Harmony.” WIX described this as the start of a broader suite of Wix-driven AI systems that could become integral to product innovation and profitability. This positioning is significant because the website-building industry is rapidly shifting into an AI-assisted development ecosystem. Companies that only integrate third-party AI tools may struggle to differentiate themselves over time. Wix is aiming to develop proprietary AI moats instead. If successful, this could greatly enhance Wix’s competitive position against rivals and emerging AI-native site builders.
In response to mixed performance trends, shares have plunged 18% in pre-market trading today. WIX's shares have lost 60% compared with the Zacks Computer-IT Services’ fall of 32.2% in the past year.
Image Source: Zacks Investment Research
Quarter in Detail
Creative Subscriptions’ revenues (70.6% of total revenues) increased 13% year over year to $382 million. Business Solutions’ revenues (29.4% of total revenues) rose 17% to $159 million.
Annual recurring revenue (ARR) grew 15% year over year to $1.9 billion, demonstrating the resilience of Wix’s subscription-based business model.
Total bookings reached $585 million, up 15% year over year, suggesting that future revenue pipelines remain strong. The standout metric was the nearly 50% year-over-year increase in bookings from the first quarter's new user cohort. Management credited both strong core business performance and meaningful contributions from “Base44,” which appears to be emerging as a major growth initiative.
Creative Subscriptions’ bookings increased 13% to $418.8 million and Business Solutions’ bookings rose 18% to $166.2 million.
Wix.com Ltd. Price, Consensus and EPS Surprise
Wix.com Ltd. price-consensus-eps-surprise-chart | Wix.com Ltd. Quote
Partners revenue grew 19% to $203.4 million. Management acknowledged a slower-than-expected start in the Partners business, along with productivity disruptions tied to the war in the Middle East.
Region-wise, North America, Europe, Asia and others, and Latin America contributed 61%, 24%, 11% and 4% to first-quarter 2026 revenues, up 12%,9%,16% and 14% year over year, respectively.
At the end of March 31, 2026, registered users were 310 million.
Operating Details
Non-GAAP gross margin was 66% compared with 69% in the prior-year quarter.
Creative Subscriptions segment achieved 80%, and the Business Solutions segment 32%.
Wix reported a non-GAAP operating income of $27.8 million compared with $99.8 million in the year-ago quarter. Non-GAAP operating margin was 5%, down from 21%.
Balance Sheet & Cash Flow
As of March 31, 2026, Wix had cash and cash equivalents of $1.34 billion compared with $311.4 million as of Dec. 31, 2025.
First-quarter cash flow from operations amounted to $78.5 million compared with $145.5 million in the previous-year quarter.
Capital expenditures totaled $3.6 million. Free cash flow was $75 million. Excluding acquisition-related costs, free cash flow would have been $112.3 million, equivalent to 21% of revenue.
A boldest move from Wix this quarter was the completion of its modified Dutch Auction tender offer. In April, the company repurchased approximately 17.5 million shares at $92 each, totaling roughly $1.6 billion. The transaction reduced outstanding shares to approximately 41.8 million as of May 11, 2026. Repurchasing nearly 30% of shares outstanding dramatically boosts future earnings-per-share potential and signals strong management confidence in Wix’s long-term intrinsic value. For long-term investors, this could become highly accretive if Wix maintains double-digit growth while improving AI-driven monetization.
Outlook for 2026 Reaffirmed
Wix maintained its expectation for mid-teens revenue growth, mid-teens bookings growth and high-teens free cash flow margins excluding acquisition costs.
The company also expects second-quarter revenue growth to remain in the mid-teens range.
Certain professional-focused product rollouts have reportedly been delayed, which could temporarily weigh on growth.
Management cautioned that full-year free cash flow margins may land in the high-teens due to reduced interest income after deploying cash toward the tender offer, interest expense from a $500 million credit facility and currency headwinds from a stronger Israeli shekel. Assuming the capital structure before the tender offer is completed and excluding acquisition-related costs, we expect full-year free cash flow margin to remain in the low- to mid-20% range.
WIX’s Zacks Rank
Currently, Wix carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Performance of Other Companies
CDW Corporation (CDW - Free Report) reported first-quarter 2026 non-GAAP EPS of $2.28, matching the Zacks Consensus Estimate. The bottom line increased approximately 6.3% year over year. CDW reported quarterly net sales of $5.68 billion, representing a 9.2% year-over-year increase. On a constant currency (cc) basis, sales grew 8.4%, reflecting healthy organic demand across the business. Quarterly revenues also surpassed the consensus mark of $5.4 billion.
FUJIFILM Holdings Corporation (FUJIY - Free Report) reported a fourth-quarter fiscal 2025 (ended March 31, 2026) net income of ¥83.4 billion compared with ¥79.4 billion in the year-ago quarter. Revenues of ¥927.3 billion jumped 6.8% year over year. The company generated record fourth-quarter revenues and net income. Revenue growth was primarily driven by the Healthcare segment, supported by contributions from newly launched Bio CDMO facilities in Denmark.
Sensata Technologies Holding plc (ST - Free Report) reported first-quarter 2026 adjusted EPS of 86 cents, up from 78 cents a year ago. The bottom line beat the Zacks Consensus Estimate by 2.4%. Revenues for the quarter reached $934.8 million, up 2.6% from a year ago. The figure came near to the upper end of management’s expectations ($917-$937 million) and beat the consensus estimate by 0.7%. Strength Aerospace, Defense and Commercial Equipment segments drove the top-line performance.