Key Highlights

  • Wix shares are trading down 3.69% at $65.82 versus a prior close of $68.34.
  • Third quarter Revenue was $570.2 million, up 13%.
  • Adjusted Earnings Per Share were $1.42, ahead of estimates.
  • Base44 annual Recurring Revenue neared $250 million.
  • Free Cash Flow Margin guidance was cut to about 16% from the high teens.

Wix.com (NASDAQ:WIX) is trading down 3.69% at $65.82, extending a slide after Tuesday's 7.70% drop to $64.38. A third quarter beat was overshadowed by a Bank of America downgrade to Underperform with a target cut to $68 from $75 and a lower free cash flow margin target. Peer Shopify (NASDAQ:SHOP) is trading down 1.18%.

Quarter Beats

Revenue was $570.2 million, up 13%, and adjusted earnings per share were $1.42, both ahead of estimates. Total non-GAAP gross margin was 69%, up two points from the prior quarter. Non-GAAP Operating Income was 12% of revenue, pressured by higher Base44 marketing.

Base44 Ramps

Base44 annual recurring revenue neared $250 million, and about 20% of the September 2026 cohort converted to paid, versus roughly 5% a year earlier. First-cohort retention beat expectations. Management plans to raise fourth quarter sales and Marketing within its return guardrails, with a roughly 13-month payback, and is building a Base44 enterprise sales team.

Free Cash Flow Target Cut

Free cash flow margin, excluding Acquisition and restructuring costs, is now about 16%, down from a high-teens target, because of Base44 Investment and a roughly $10 million fourth quarter Working Capital item. Cash was about $1.05 billion against $1.63 billion of debt.

Guidance

Full-year 2026 guidance for bookings growth in the low teens and revenue growth in the low to mid teens was maintained. Fourth quarter revenue is expected to grow at a low double-digit rate, with bookings growth lagging revenue. Looking to 2027, the chief financial officer expects Base44 gross margin to approach core Wix levels and absolute free cash flow dollars to be higher than in 2026, depending on marketing spend.

Analyst Views

BofA flagged partner growth slowing to 11%, competition from AI coding tools such as Lovable and Cursor, and core annual recurring revenue growth of perhaps 3% to 4%. JPMorgan trimmed its target to $59, while Jefferies and Cantor raised theirs. Of 22 analysts, 13 are bullish, seven neutral and two bearish, with an average target of $97.59 and a range of $58 to $210.

Base44 Returns Decide the Next Move

The debate is whether Base44 spending earns enough to justify lower near-term cash flow. Investors will watch fourth quarter marketing against the 13-month payback, whether the paid conversion rate holds near 20% and whether partner growth stabilizes.

The 2027 free cash flow dollars and Base44 gross margin are the longer-term markers.