Wix reported its third-quarter 2026 results. Revenue reached $570.2 million, up 13% from a year earlier, and bookings reached $573 million, up 11%. Annual recurring revenue (ARR) passed $2 billion for the first time, reaching $2.021 billion, up 15%. The company reported a GAAP loss of $13.7 million and adjusted net income of $69.3 million. The stock rose about 2.7% after the report.
The star of the report is Base44, the Israeli company Wix bought in June 2025 for about $80 million, which lets users build apps and websites from a plain-language description. According to Wix, Base44's ARR is nearing $250 million. Its adjusted gross margin reached 58% in the quarter, up from nearly zero in the first quarter, and the company attributes the improvement to lower costs of running AI models, mainly thanks to a model it built itself. Wix expects Base44's gross margin to approach the core business's level, about 70%, in 2027.
Wix also announced that its president, Nir Zohar, has been named co-CEO alongside founder Avishai Abrahami, effective immediately. Zohar, who has been with the company for many years, has in practice run much of its day-to-day operations, and the appointment formalizes the existing situation more than it changes it. Still, at a company whose identity is so tied to its founder, it is a first step toward an era in which Wix does not depend on one person.
The less glamorous side is cash flow. According to reports, Wix lowered its full-year free cash flow margin guidance, partly because of heavy investment in Base44's growth: servers, model costs and marketing. Free cash flow in the quarter was $74.5 million. In other words, Wix is buying growth and paying for it out of the profitability that until recently was one of its standout strengths.
The bottom line: Wix has achieved something most older software companies only talk about. It found an AI product that brings in real money, fast. But 13% growth is still below what the market expects from a company presenting itself as an AI company, and Base44 has to keep growing at a breakneck pace to pull all of Wix along. In a week when the whole market remembered that high rates punish companies promising future profits, Wix will have to show the model works even when money is expensive.
