On May 25, 2026, Wix (NASDAQ: WIX) announced plans to cut between 800 and 1,000 employees, the largest workforce reduction in the Israeli website-builder's 20-year history. The cuts represent roughly 20% of the company's 5,277-person global headcount as of the end of Q1 2026, and will affect every department across the business. Because over 60% of Wix employees are based in Israel, the layoff also stands as one of the largest single-event reductions in Israeli tech history.
The announcement landed less than a week after Wix reported its Q1 2026 earnings, in which the company posted a $57.5 million net loss despite a 14% increase in revenue to $541 million. Operating expenses jumped 50% year over year to $423 million, eating roughly 35% of revenue compared with 21% in Q1 2025. Cash flow fell 21% to $112 million. The stock dropped roughly a third in a single session on the print and is now down close to 50% year to date.
Wix is unusually direct about the reasoning. Internal language reported by Globes and Calcalist names AI tools as the reason multiple roles are no longer required. As AI agents take on more development, design, and content production work, several positions across engineering and creative are described as redundant. The framing is consistent with the broader 2026 pattern from LinkedIn, Intuit, Cisco, and ClickUp, but the workforce percentage is higher than most peers and lands the cut in the AI-driven tier.
The irony is local. Wix's own AI platform Base44, acquired in 2024 and run as a separate brand inside the company, hit roughly $150 million in annualized recurring revenue in May, well ahead of internal targets. The product that is working is the same kind of agent technology being cited as the reason coworkers are being cut. Wix is reallocating headcount around Base44 and AI-native product surfaces, and the rest of the org is paying for it.
Wix went public on Nasdaq in 2013 and rode the COVID-era SMB digitization wave to a peak market cap above $19 billion. It now trades roughly 75% below that peak. The current price reset reflects both a slowdown in net subscriber additions and a sharp markup in operating costs as the company tries to compete on AI-native website creation against Shopify, Squarespace, and a fresh tier of OpenAI- and Anthropic-powered builders that did not exist 18 months ago.
This is the largest Wix workforce reduction by a wide margin. Prior rounds in 2022 and 2023 were each in the low hundreds and framed as targeted optimizations. May 2026 is described internally and in the press as a strategic reset, not a routine trim. Coupled with the recent end of the hybrid work policy and the move to a large new Glilot Junction campus, the company is signaling that it intends to operate as a smaller, in-office, AI-forward shop going forward.
Wix is one of the most globally recognized Israeli tech brands and a bellwether for SMB-focused SaaS. A 20% cut at the largest Israeli software company sized for 2026 economics tells two stories at once. First, the AI-native rebuild of the website creation stack is far enough along that incumbents are restructuring around it in public. Second, the cost of running a global SaaS business with traditional headcount math no longer pencils when the AI tier of competition has been operational for a year. Expect Squarespace, GoDaddy, and Shopify to face investor pressure to publish their own AI-readiness restructuring plans in the next two quarters.