Wix lays off 1,000 workers as AI capabilities and currency pressures force major restructuring

Wix lays off 1,000 workers as the AI jobs apocalypse keeps looking very real

Serving tech enthusiasts for over 25 years. TechSpot means tech analysis and advice you can trust. A hot potato: The AI jobs apocalypse that Sam Altman is glad isn't happening continues not to happen. The latest company to lay off a large portion of employees is Wix, which is cutting 20% of its workforce while citing the "fast evolution" of AI. CEO Avishai Abrahami wrote on X that reducing the Wix team by 20%, or around 1,000 people, was a "hard decision" (four times). Abrahami said the first reason why the website builder is cutting staff is the exchange rate between the Israeli shekel and the US dollar. He said the shekel has strengthened against the dollar in recent quarters, creating a "structural pressure" on Wix's ability to operate at scale. Then there's the very familiar second reason: "the fast evolution of AI capabilities." Abrahami writes that "we have witnessed the most significant shift in how companies are built since the invention of modern programming languages in the 1970s." "This is not just about adopting new tools - it is about rewiring how companies are built, how they think, how they manage and how they operate. Companies that embrace this change will not only build faster; they will build things the previous generation literally could not have imagined." The CEO goes on to talk about the need to become a faster, leaner, flatter organization due to AI, with fewer layers between leadership and team members. Then there are the usual lines about needing to evolve in order to compete, we had no choice, etc. This sort of CEO message has become a depressingly common sight in the AI age. Abrahami's post is very similar to the one Jack Dorsey wrote when Block laid off over 4,000 people earlier this year. The former Twitter boss said it was better to get rid of everyone at once rather than lay people off slowly over the coming months and years as automation took their jobs. Wix's mass layoffs come just days after OpenAI boss Altman gushed about how excited he was that the AI jobs apocalypse he predicted last year had not come to pass. There have been almost 116,000 layoffs in the tech world so far in 2026, quickly approaching the 124,000 that we saw for the entirety of 2025. A massive percentage of these cuts are tied to AI, either through direct job replacement or companies' resources being redirected toward AI infrastructure. Altman's view that things could always be worse might fade away in the coming years. A recent survey of almost 1,000 executives found that 99% said they expect to make some reduction in headcount in the next 24 months. The irony in all this is that companies spending millions and billions on AI still aren't seeing any meaningful returns. A survey in January found more than half the participating CEOs said AI adoption had not increased revenue or reduced costs, something Uber is all too familiar with.

Wix cuts 20% of workforce in AI and currency restructuring

Wix is cutting roughly 1,000 jobs, about 20% of its workforce, in the largest layoff in company history. CEO Avishai Abrahami cited the strengthening Israeli shekel and the need to rebuild the company around AI-native roles. The stock has fallen more than 50% in 2026. Wix is laying off approximately 1,000 employees, roughly 20% of its workforce, in the largest round of cuts in the company's history. CEO and co-founder Avishai Abrahami announced the decision on 28 May in a message posted publicly on X and sent simultaneously to all staff. He framed the restructuring as a company-wide change driven by two forces: a currency mismatch that is making the company's Israeli workforce increasingly expensive in dollar terms, and a fundamental shift in how software companies need to operate in the age of AI. Wix employed 5,277 people at the end of March 2026, with more than 60% based in Israel. The cuts will reduce headcount to roughly 4,200. Affected employees will receive what Abrahami described as personally curated separation packages and will be contacted individually. The shekel problem The Israeli shekel has strengthened sharply against the US dollar over the past two years, rising roughly 14% in 2025 and a further 7% in the first five months of 2026. For a company that earns the vast majority of its revenue in dollars but pays the majority of its workforce in shekels, the effect is a structural cost increase that no amount of product improvement can offset. The currency shift has hit the entire Israeli tech sector. A startup that raised a million dollars when the exchange rate was 3.7 shekels to the dollar now finds that same million buys roughly 700,000 fewer shekels. Israeli engineering salaries have risen 15% to 20% in dollar terms within a few months, making Israeli developers among the most expensive in the world, sometimes more costly than their counterparts in Silicon Valley. Wix is not the only Israeli company affected, but its exposure is unusually concentrated. With more than 3,000 employees in Israel and revenue denominated almost entirely in dollars, the company's cost base has been rising faster than its top line can grow. AI is the other half of the equation Abrahami described the current moment as the most significant shift in how companies are built since the invention of modern programming languages in the 1970s. He said Wix is moving to a flatter organisational structure with fewer management layers, designed to enable faster decisions and clearer ownership. The company has introduced new roles, including a position it calls xEngineer, a design-first engineering role built around AI-native workflows, and Creators, a broader category for employees working primarily with AI tools. The restructuring is not abstract. Other SaaS companies have made similar moves in recent months, with ClickUp cutting 22% of its staff and GitLab restructuring for what it called the agentic era. The common thread is that companies are eliminating roles they believe AI can perform or augment, then reorganising around a smaller workforce that directs AI systems rather than doing the work manually. The stock collapse that preceded the cuts The layoffs follow a brutal period for Wix's stock. Shares fell 27% on 13 May after the company reported first-quarter earnings that missed Wall Street expectations. Revenue rose 14% year on year to $541 million, but Wix posted a net loss of $57.5 million after several profitable quarters. Adjusted earnings came in at $0.68 per share, well below the $1.22 consensus estimate. Operating expenses as a percentage of revenue surged from 21% in Q1 2025 to 35% in Q1 2026, a trajectory that alarmed investors. The stock has lost more than 50% of its value since the start of the year, reducing Wix's market capitalisation to roughly $2 billion, down from a peak of nearly $20 billion in 2021. The company also acknowledged that its professional developer customers were using competing AI tools, and that its new Wix Harmony platform had gaps and missing capabilities that delayed product updates. Wix acquired Base44, a vibe-coding platform, for $80 million earlier this year, but the integration has not yet reversed the competitive pressure. The vibe-coding threat Wix's core business, helping non-technical users build websites, is being challenged by a new generation of AI-powered tools that let anyone describe what they want in plain language and have an AI build it. Platforms like Lovable, valued at $1.8 billion, and Bolt.new have attracted users who might previously have turned to Wix. The vibe-coding movement has also raised security concerns, with research finding thousands of vulnerabilities in publicly deployed applications built with these tools, but the speed and simplicity of the approach is drawing users regardless. Wix's response has been to layer AI into its existing platform through Wix Harmony, its core website builder, Wix Vibe, a headless AI site creation tool, and Base44 for AI application building. Base44 reportedly reached $100 million in annual recurring revenue within roughly a year of its founding. But the broader market narrative, sometimes called the SaaSpocalypse, has punished conventional software companies whose products investors believe AI agents could make obsolete. A pattern across the industry Wix is part of a wave of AI-driven layoffs that has swept the tech industry in 2026. More than 95,000 jobs have been cut across roughly 250 events so far this year, according to industry trackers. Meta cut 8,000 jobs and Microsoft offered its first-ever voluntary retirement programme. Oracle eliminated up to 30,000 positions. GitLab restructured around AI agents. The pattern is consistent: record or near-record revenues, significant headcount reductions, and the savings redirected into AI infrastructure. Abrahami's letter was notable for its directness. He told remaining staff to treat departing colleagues with respect and acknowledged that the people being let go had built things the company is proud of. He framed the decision as necessary to protect Wix's users, shareholders, and long-term viability. Whether the restructuring succeeds will depend on whether a leaner, AI-augmented Wix can grow its way out of a currency squeeze and a competitive landscape that is being redrawn by the same technology it is betting on.

Wix CEO cites 'fast evolution of AI capabilities' in announcement of 20% workforce cut

* Wix has confirmed plans to lay off around one in five workers * Despite job cuts, the company will continue to hire new roles for an AI-first future * Share prices down following news, also down following disappointing Q1 EPS miss Wix CEO Avishai Abrahami confirmed in an X post that the company will be laying off around 20% of its workers as a result of an ongoing restructuring initiative set to affect all departments. Among the reasons cited for the mass layoffs were currency and exchange rate pressures, with many of the company's workers and a large portion of its operating costs housed in Israel, under the Israeli Shekel. Conversely, a lot of company revenue is Dollar-dominated, which has created a significant gap in currency sustainability. AI, streamlining and missed earnings "In the past few quarters the exchange rate between the Shekel and the US dollar has shifted significantly," he said. "This creates a structural pressure on our ability to operate at our current scale." Additionally, the CEO unsurprisingly blamed artificial intelligence for the shakeup. "We have witnessed the most significant shift in how companies are built since the invention of modern programming languages in the 1970s," the leader stated. Abrahami explained that companies like Wix must 'rewire' how they operate, leading to major job cuts. But the leader didn't rule out future hires, noting the creation of new roles like Xengineer and Creators already. He also become one of a growing number of business leaders to cite the need to flatten organizational hierarchy to streamline efficiency. He hopes a leaner will will enable faster decisions to be more agile to shifts in tech capabilities and customer trends. Though the finer details are under wraps, affected workers are being promised "personally curated separation packages." Company shares are down around 1.5% following the announcement, and worse still, down around 47.9% this year to date following a major first-quarter earnings miss where adjusted EPS stood at $0.68 compared with Wall Street forecasts of $1.22. Follow TechRadar on Google News and add us as a preferred source to get our expert news, reviews, and opinion in your feeds.

Wix cuts 20% of its employees citing shekel-dollar exchange rate, AI implementation

Israeli tech giant Wix will lay off 20% of its employees, CEO Avishai Abrahami announced in a Thursday X/Twitter thread, citing financial difficulties due to the recent strengthening of the shekel against the dollar. "We are reducing the Wix team size by roughly 20%. It is one of the hardest decisions I have had to make, but I am confident it is the right one, and I will explain why," Abrahami wrote in a letter that was also shared with all of the company's employees. According to his assessment, the fact that the company has shekel-dominated costs and dollar-denominated revenue made it impossible to keep its current operations running without cutting some of its Israeli operations. "This creates a structural pressure on our ability to operate at our current scale. It is a reality that directly shapes what is sustainable for our company," he added. The second reason stems from Wix's recent use of artificial intelligence for several tasks, which made some positions at the company redundant, with those employees replaced by automated agents. According to Abrahami, the company is now introducing new positions, such as "Xengineer and Creators," whose roles were "designed from the ground up around AI-native ways of working." But these new positions require a "faster-moving structure" than what Wix has been using. AI pushing Wix towards layoffs "We are moving to a structure with fewer levels between any member of our leadership and the most junior person on the team. Fewer layers means faster decisions, clearer ownership, and less distance between the people setting direction and the people building the product - but it also means a smaller number of people," Abrahami explained. He also added that the company is "choosing to compete" in an era when companies need to take on risk, invest in AI, or risk "falling behind." "To those of you who are being let go, I want to once more say: Thank you," he wrote, adding that every person being let go would be personally contacted, and his situation would be handled by the company "with sensitivity, respect, and the care you deserve, you will also be granted personally curated separation packages." Shekel-dollar crisis hits high-tech sector Wix becomes the first victim of the "shekel-dollar crisis," with many analysts noting that companies based in Israel with returns in dollars (as is the case for many high-tech startups and firms) might be hit hard by the current strengthening of the Israeli currency. While many companies were able to overcome it by hedging their dollar transactions, this strategy would only solve the problem in the short term. Venture Capital Michael Eisenberg, who works as a managing partner at the Israeli VC firm Aleph, told Walla that he has been pushing companies to hedge their funds, which would allow them to set the exchange and avoid liquidity problems if they needed to convert those funds to shekels. Hedging dollar transactions and currency transactions in general is a financial tool used by companies that helps establish stable exchange rates for buying and selling currencies, providing greater stability and predictability. "Every 10% shift in the shekel-dollar exchange rate removes between 150 and 200 months of runway among our portfolio companies that did not hedge the dollars they raised," Eisenberg said. The Bank of Israel, which serves as Israel's central bank and sets the country's interest rates, lowered rates on Tuesday in an effort to weaken the shekel, boosting sectors highly dependent on exports. But the move didn't accomplish its objective, with the shekel registering another round of strengthening, with the shekel-dollar exchange rate down 1.651% at NIS 2.859/$ and down 1.571% against the euro at NIS 3.326/euro. In late-afternoon interbank trading, the shekel strengthened a further 1.02% to NIS 2.824/$ and a further 1.43% against the euro to NIS 3.301/euro. Tzally Greenberg and Eitan Gerstenfeld/Globes/TNS contributed to this article.