Wix Stock Down 70% This Past Year as One Fund Discloses $122 Million Exit

Core Insights - Foxhaven Asset Management sold its entire stake in Wix.com for approximately $122.39 million, liquidating 689,041 shares as per a SEC filing dated February 17, 2026 [1][2]. Company Overview - Wix.com reported a total revenue of $1.93 billion and a net income of $138.90 million for the trailing twelve months (TTM) [4]. - The company's market capitalization stood at $3.79 billion, with shares priced at $68.07 as of February 17, 2026, reflecting a 70% decline over the past year [4][7]. Business Model and Competitive Advantage - Wix.com operates a scalable subscription model and offers a broad ecosystem of integrated services, which drives recurring revenue and customer engagement [6]. - The platform is recognized for its user-friendly interface and extensive feature set, catering to the diverse needs of businesses and creators in the digital economy [6][8]. Financial Performance - In the third quarter, Wix's revenue increased by 14% year-over-year to $505 million, with bookings also rising 14% to $514.5 million [7]. - The company's annual recurring revenue (ARR) from subscriptions reached $1.46 billion, and it generated $127 million in free cash flow during the quarter [9]. Market Position and Future Outlook - Despite operational stability, Wix.com has faced significant stock price declines, underperforming the S&P 500, which gained approximately 15% in the same period [7]. - Management has raised full-year bookings guidance to between $2.06 billion and $2.08 billion, driven by strong demand for its AI-driven Base44 product, expected to achieve at least $50 million in ARR by year-end [9]. - The current valuation disconnect reflects changing investor expectations, with a focus on margin pressures from AI investments and a shift towards longer-term subscription packages [10].