Wix added $150M in revenue, then fired 1,000 people to afford it.

This week it is firing 1,000 people to afford it.

Revenue up 14% to $541 million. A $34 million profit last year turned into a $57 million loss. Cash flow down 21%. Twenty percent of the workforce, gone.

Revenue up. Everything that actually matters, down.

Here is what happened, because every founder should sit with this one.

A year ago Wix saw AI coming and moved fast. It bought Base44, a vibe-coding startup, to bolt an AI site-building tool onto its platform. Smart, early, decisive. And it worked. Base44 went from zero to $150 million in annual recurring revenue in months. Most of Wix's growth now comes from it.

So why the loss? Why the layoffs?

Because that revenue costs more than it earns.

Every new Base44 user adds compute and marketing costs. Wix spent $90 million acquiring customers for it last quarter. $200 million on marketing overall. $20 million on a single Super Bowl campaign. Operating expenses jumped 50%. The faster Base44 grows, the more money Wix loses.

That is not a growth engine. It is a subsidy with a growth chart attached.

Founders fall in love with ARR because it is the cleanest, most flattering number on the board deck. But ARR that costs $1.20 to earn $1.00 is not an asset. It is a liability wearing a growth costume.

The question is never "are we growing." Plenty of companies grew right up until the day they didn't. The question is "does each new customer make us money or cost us money, and is that gap getting better or worse."

Wix added $150 million in revenue and had to fire a fifth of its people to afford it.

If your top line is climbing and the floor still feels like it is dropping, you do not have a growth problem. You have a revenue quality problem. And new customers never fix revenue that loses money on the way in.