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- 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.
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