Wix Stock Under Pressure Heading Into Earnings – Down 42% YTD

Wix.com Ltd. (NASDAQ: WIX), a leading cloud-based web development platform, is facing significant headwinds as it approaches its third-quarter 2025 earnings release this morning. The stock is currently trading at $126.92, down 6% in the last five days, and a substantial 41% year-to-date decline reflects market unease.

Analysts expect a relatively stable quarter for Wix, projecting EPS of $1.49, essentially flat compared with $1.50 in the same period last year, alongside revenue of about $502.51 million, representing an estimated 13.01% year-over-year sales growth.

Several recent developments have influenced Wix's stock performance. A strategic collaboration with PayPal, announced on October 29th, aims to integrate AI-powered product discovery and checkout services for Wix merchants. This partnership, expected to roll out in early 2026, could potentially boost merchant sales and customer engagement by seamlessly syncing product data with PayPal’s AI-driven shopping platforms.

However, not all news has been positive. On November 1st, Wall Street Zen downgraded Wix's stock rating from “strong-buy” to “buy,” suggesting a more cautious outlook from analysts. Adding to the volatility, in early October, the stock plummeted 13.4% following the announcement of a $1 billion upsized convertible notes offering, raising concerns about potential share dilution. Conversely, positive momentum arrived mid-October, with a 1.99% surge fueled by AI-driven product launches and strategic financial services expansion.

Institutional investment activity offers a mixed signal. Analyst IMS Investment Management Services Ltd. recently disclosed the acquisition of 71,420 shares of Wix.com, valued at approximately $10.9 million, increasing their total holdings significantly.

Wix has also been actively investing in AI, unveiling “Astro,” an AI-powered business assistant designed to enhance user productivity. This reflects the company's commitment to integrating advanced technologies into its platform.

While the prevailing sentiment surrounding Wix appears cautious, a closer examination reveals a company actively adapting and innovating. The market may be overly focused on short-term headwinds, such as the convertible notes offering, and underestimating the potential of Wix's AI-driven initiatives and strategic partnerships.

The integration of AI is not merely a cosmetic upgrade; it represents a fundamental shift towards a more intuitive and efficient platform, potentially attracting a new wave of users and driving revenue growth. Furthermore, the concerns about share dilution may be overblown. The capital raised through the convertible notes could be strategically deployed to accelerate growth initiatives and further solidify Wix's market position.

We will be paying close attention to revenue growth, profitability metrics, and management's outlook for the future. The next 24 hours could prove to be pivotal.