Wix Shares Drop Despite Higher Bookings and Revenue Forecast Following AI-Driven Demand

Core Viewpoint - Wix.com raised its full-year bookings and revenue outlook following strong third-quarter results, driven by increased demand from its AI coding platform Base44, despite a significant drop in share price [1][2]. Financial Performance - For 2025, Wix expects bookings to be between $2.06 billion and $2.08 billion, an increase from the previous range of $2.04 billion to $2.08 billion [2]. - The full-year revenue forecast has been raised to $1.99 billion to $2.00 billion, compared to the earlier guidance of $1.98 billion to $2.00 billion [2]. - Third-quarter revenue was reported at $505.2 million, with total bookings rising to $514.5 million [4]. Growth Metrics - For the fourth quarter, Wix projects revenue between $521 million and $531 million, indicating a year-over-year growth of 13% to 15% [3]. - Creative Subscriptions revenue increased by 12% to $356.2 million, while Business Solutions revenue grew by 18% to $149 million [4]. - Creative Subscriptions annual recurring revenue reached $1.48 billion, reflecting an 11% year-over-year increase [4]. Cost and Margin Expectations - The non-GAAP gross margin for the year is expected to be between 68% and 69%, influenced by increased AI-related costs from Base44 [3]. - Non-GAAP operating expenses are projected to be approximately 50% of revenue, with free cash flow expected to reach about $600 million, or around 30% of revenue [3].