Wix: A Mildly Interesting Investment

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The year is 2026, and the markets, as they are wont to do, are experiencing a period of what can only be described as ‘mild panic.’ Nearly everything related to software is being sold off, a phenomenon roughly equivalent to everyone suddenly deciding they no longer require oxygen. The cause? A collective fear that artificial intelligence (AI) will render entire industries obsolete, replacing carefully crafted code with…well, more code, only generated by machines. The idea is that companies can now conjure software from thin air in a matter of hours, bypassing the need for actual, paid-for programmers. (Which, let’s be honest, is a bit like discovering you can teleport instead of driving. Convenient, but potentially disruptive to the automotive industry.) Shares are plummeting, sometimes by as much as 20% overnight. It’s all terribly dramatic.

One stock caught in this particular whirlwind is Wix.com (WIX 3.64%). The website-building platform has dipped below $70 a share, its market value shrinking to a mere $3.8 billion. (A sum, incidentally, that could buy you a surprisingly small island, depending on location and the presence of pirates.) I suspect this is a rather overzealous reaction, a classic case of throwing the digital baby out with the bathwater, and potentially presents an opportunity for…well, let’s just say ‘interesting’ returns over the next decade.

Here’s why accumulating some Wix stock today might not be the worst decision you’ve ever made. (Although, it’s unlikely to be as good as discovering a winning lottery ticket, or finally understanding the offside rule in football.)

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An AI Loser Treated Like…Another AI Loser?

Wix, at its core, is a low-code website builder. It allows individuals with minimal technical expertise – shop owners, freelance consultants, people who simply want to share their cat pictures with the world – to establish an online presence. It’s free to tinker with, to experiment, to create a digital monument to one’s hobbies. But to actually have a website, a proper, functioning entity on the internet, requires a monthly or annual subscription. They also generate revenue through add-ons – email marketing, payment processing, analytical tools, the usual suspects.

The prevailing bearish argument is that AI chatbots will now allow anyone to build a website with a few well-chosen prompts. This, however, misses the point. Wix already allows individuals to use prompts, templates, and AI to build their online presence. It’s been doing so for years. In fact, Wix is now actively leveraging these very AI advancements to improve its products, making it even easier for people to get online. (Think of it as AI helping AI. It’s turtles all the way down.)

Therefore, Wix should be considered an AI winner, not an AI loser. Furthermore, their acquisition of Base44, a prompt-based mobile app builder, is proving rather fruitful. Annual recurring revenue (ARR) is expected to hit $50 million in 2025, a significant jump from under $1 million at the time of the acquisition last year. (Which, statistically speaking, is a rather impressive growth rate. Unless, of course, you’re comparing it to the expansion of the universe, in which case it’s barely noticeable.)

Looking at Wix’s recent performance, there’s little evidence to suggest the company is struggling due to AI. Revenue was up 14% year-over-year last quarter, reaching $500 million, with expectations of $600 million in free-cash-flow generation in 2025. (Which, if converted into physical currency, would require a rather large truck.)

Why Wix Might Not Completely Ruin Your Portfolio

Wix represents a potentially fantastic investment due to its sustained growth in both website (and now app) development, coupled with the fact that its stock is currently trading at a price that could be described as ‘remarkably reasonable.’

At a market cap of $3.8 billion, Wix is trading at just 6.3 times its 2025 free-cash-flow guidance. Moreover, the company has announced a $2 billion share repurchase program, representing over half its current market value. If aggressively implemented, this could significantly reduce the number of outstanding shares over the next few years, further boosting returns for shareholders. (Assuming, of course, that shareholders still exist. It’s a valid concern.)

If revenue continues to grow at a healthy pace, free cash flow remains robust, and the buyback program continues, Wix could deliver substantial returns to shareholders who buy today and hold for the next decade. (Although, past performance is no guarantee of future results. It’s a disclaimer we’re legally obligated to include, even though it’s utterly pointless.)

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2026-02-17 18:52