--- title: "Wix’s Base44 nears US$250m ARR as its gross margin climbs to 58% from near zero" summary: "Wix’s results for July to September: how moving Base44 onto its own AI model took gross margin from near zero to 58% in six months, what that figure leaves out, and where the savings went." url: https://www.thetechbag.com/blog/wix-base44-250m-arr-58-percent-margin format: Note desk: "SaaS & business software" region: Global published: 2026-11-10 facts_checked: 2026-11-10 author: TechBag (The TechBag Journal) tags: ["Wix","Base44","Base 1","vibe coding","AI inference","large language models","GPUs","gross margin","ARR","free cash flow","sales and marketing","co-CEO","Nir Zohar","earnings"] cover: https://www.thetechbag.com/blog/covers/wix-base44-250m-arr-58-percent-margin.png --- # Wix’s Base44 nears US$250m ARR as its gross margin climbs to 58% from near zero *Wix’s results for July to September: how moving Base44 onto its own AI model took gross margin from near zero to 58% in six months, what that figure leaves out, and where the savings went.* Note · SaaS & business software · By TechBag · Published 2026-11-10 · Facts checked 2026-11-10 · Canonical: https://www.thetechbag.com/blog/wix-base44-250m-arr-58-percent-margin Base44, the app-building tool Wix bought in June 2025, is close to US$250m of annual recurring revenue, and its non-GAAP gross margin reached 58% in July–September from near zero in January–March.[1] Wix paid a total consideration of about US$92m for it, most of that an earn-out tied to revenue through 2028.[6] On the same day Wix cut its full-year free-cash-flow margin guide to about 16% from the high teens, “primarily due to accelerated sales and marketing investments in Base44”.[1] ~US$250m Base44 annual recurring revenue, 10 November US$100m in March 58% Base44 non-GAAP gross margin, July–September near zero in January–March <30% all AI costs as a share of Base44 bookings, second-half forecast free and paid users ~16% Wix full-year free-cash-flow margin guide was high teens ## Why a vibe-coding product starts near zero Vibe coding, as Wix describes it, is building an application by describing it in plain language.[6] Every prompt runs through a large language model, and Wix calls compute and inference spend “the largest cost driver in AI-native businesses”.[3] Inference is the computing consumed each time a model answers. While Base44 ran on models bought from outside, that bill grew with use, and Wix says the product entered the year with a gross margin near zero.[3] Wix names no supplier in these documents. So it built its own, as it had already done for Wix Harmony.[4] Base 1, Base44’s proprietary model, launched with the second-quarter results, and the third quarter was its first full one.[2][3] Sending prompts to Base 1 instead of a bought-in model is what moved the margin; Wix also credits other work on inference costs.[2] It does not make the bill disappear. Wix’s research costs include “increased GPU investments” to train its models, and it expects a working-capital hit of about US$10m in the fourth quarter from prepaying for GPUs “required to run our models for the next couple of years”.[1][2] In our reading, paying for chips in advance replaces part of a bill that used to rise with each prompt. Across the whole company, non-GAAP gross margin was 69%, up two points from the quarter before, which Wix puts down mainly to that full quarter of Base 1.[2] ## What the 58% counts The figure covers paying users only. Wix says gross margin “takes into account only AI costs incurred by paid users as well as hosting, customer care and overhead expenses”. AI costs for free users, who are Base44’s sales funnel, go elsewhere: they sit in sales and marketing.[2] Those fell more than 50% from the previous quarter, which Wix attributes mainly to routing free users’ prompts through Base 1.[2] The wider measure Wix gives is total AI cost for free and paid users as a share of Base44 bookings, now expected below 30% in the second half, against an earlier expectation of 30% to 40%.[2] ReportedWhat Wix expects next Wix expects Base44’s gross margin above 60% by the fourth quarter and approaching the core business next year; Creative Subscriptions, the segment that holds both, was at 83%.[1][2] Wix says most Base44 subscriptions are billed monthly, and annual plans were more than 20% of the September cohort against about 5% a year earlier.[1] ## Where the saving went Wix said in August that it would put the AI savings into Base44’s marketing, and it did. Non-GAAP sales and marketing rose 46% to US$185.5m, 33% of revenue; non-GAAP operating margin fell to 12% from 18%.[1][2][3] Free cash flow excluding restructuring was US$99.6m, or 17% of revenue, against US$159.4m a year earlier.[1] The full-year guide has moved from the low- to mid-20s in March, on a slightly different definition, to high teens in August to about 16% now.[1][3][5] The rest of Wix is growing more slowly. Bookings rose 11% to US$573.0m and revenue 13% to US$570.2m, with total recurring revenue up 15% to US$2.02bn; Base44 is about 12% of that (our arithmetic, its figure being a later date). Wix expects fourth-quarter bookings to lag revenue again on softness in its Partners business, the agencies and resellers who build for clients.[1] Nir Zohar, co-founder and president, became co-chief executive alongside Avishai Abrahami, effective immediately; Zohar takes business strategy, go-to-market and operations and Abrahami takes product, AI and technology.[1] Wix’s shares closed at US$69.75 on 9 November, down 8.3%, the day before the results.[7] What to watch: the fourth-quarter margin against the 60% Wix has promised, and whether marketing spend falls once the margin is there. How we did this Figures as of 10 November 2026, 7:30pm IST All Base44 figures are Wix’s own, from its release and Shareholder Update of 10 November and earlier releases; the purchase terms are from its 20-F for 2025. Non-GAAP gross margin is Wix’s measure, and the paragraph above sets out what it includes. Base44’s share of total recurring revenue is our arithmetic and compares a figure for today with one for 30 September. The account of Base 1 is Wix’s own; Wix does not name its outside model suppliers here or give Base44 revenue separately. This piece uses the 6-K accepted at 4:47pm IST on 10 November; the US market had not opened when it was written, and Wix’s results call, which began at 7pm IST, is not used. The close is Nasdaq’s, and we attribute no cause to the share move. Spotted an error? Write to us; corrections are published at the foot of the piece. Sources 1. [Wix, Reports Third Quarter 2026 Results (6-K, Exhibit 99.1)](https://www.sec.gov/Archives/edgar/data/1576789/000162828026072477/thirdquarter2026results.htm) — 10 November 2026 2. [Wix, Shareholder Update, Third Quarter 2026](https://4f4a3186-9467-4c09-aa74-51fe1affec20.usrfiles.com/ugd/4f4a31_6d77ccb9de674ee79cd504000c1e6aba.pdf) — 10 November 2026 3. [Wix, Reports Second Quarter 2026 Results (6-K, Exhibit 99.1)](https://www.sec.gov/Archives/edgar/data/1576789/000162828026052108/secondquarter2026results.htm) — 4 August 2026 4. [Wix, Reports First Quarter 2026 Results (6-K, Exhibit 99.1)](https://www.sec.gov/Archives/edgar/data/1576789/000162828026034370/firstquarter2026results.htm) — 13 May 2026 5. [Wix, Reports Fourth Quarter and Full Year 2025 Results (6-K, Exhibit 99.1)](https://www.sec.gov/Archives/edgar/data/1576789/000162828026014406/fourthquarterandfullyear20.htm) — 4 March 2026 6. [Wix, annual report on Form 20-F for 2025 (acquisition of Base44, Note 3; vibe coding)](https://www.sec.gov/Archives/edgar/data/1576789/000162828026015222/wix-20251231.htm) — 5 March 2026 7. [Nasdaq, Wix (WIX) historical prices (closes to 9 November 2026)](https://www.nasdaq.com/market-activity/stocks/wix/historical) — 9 November 2026 **Disclosure.** TechBag is a software reseller: it earns a margin when a reader buys through it, including from vendors named here. The analysis is TechBag’s own; no vendor paid for or saw this piece before publication. Facts are labelled reported, TechBag count or our view. **Read this next:** [GPU rent turned up: B200 hours rose 21% in a month, H100 hours 7%](https://www.thetechbag.com/blog/gpu-rental-prices-turn-up-b200-h100) — What running your own model now costs by the hour: rented B200 GPU hours rose 21% in a month and H100 hours 7%, on two public indices. Go deeper on TechBag - [Cloudflare’s revenue grew 39%; its gross margin fell to 71.2%](https://www.thetechbag.com/blog/cloudflare-grows-39-margin-falls) — AI inference and gross margin at another software company, the same quarter - [8 of 10 low-code platforms print a price](https://www.thetechbag.com/blog/top-10-low-code-solutions-smbs-streamline) — what the tools before vibe coding charge - [An Agentforce action costs 10 cents, a conversation $2](https://www.thetechbag.com/blog/how-ai-agents-are-billed-credits-actions) — how usage-based AI is sold, the other side of an inference bill