Wix at 7.5x Free Cash Flow: Deep Value or Value Trap?

Wix took on $1.1B in 0% convertible notes priced near $210/share, then bought back $1.6B of stock, all with shares trading around $75. Is management seeing value the market is missing, or is WIX a value trap? Wix (WIX) has been one of the hardest-hit names in this year’s SaaSpocalypse. The market has been pricing software companies as if the AI labs will absorb everything. The numbers tell a more complicated story. Revenue re-accelerated 15% year over year to $563 million in Q2 2026, driven by price increases and by Base44, the vibe coding app builder Wix acquired in June 2025. Base44 crossed $150 million in annualized recurring revenue in May. In this video, Nick and Kasey break down Wix Harmony, Base44, and Base1, Wix’s proprietary LLM built to lower AI inference costs and lift gross margins. We walk through the balance sheet, the $1.6 billion net share repurchase, and an AI investment cycle that cut quarterly free cash flow from $156 million to $53 million. Then we run a reverse DCF and our normalized profit calculator, compare WIX to Shopify, Figma, and Adobe on valuation, and explain how we’re handling our own position. Our approach is a small-bets basket with a hard rule for reassessing. If you want the reasoning behind more names like this one, Semiconductor Insider covers the process in more depth. Get access to all our research, weekly live Q&A events, and a growing set of tools to build your process. Create your free demo account now at https://www.chipstockinvestor.com 📰 Why Chip Stock Investor Is Becoming a Software Business: https://chipstockinvestor.com/why-chip-stock-investor-is-becoming-a-software-business/ Linktree for all our socials: https://linktr.ee/chipstockinvestor If you found this video useful, please make sure to like and subscribe! 0:00 - Wix After the SaaSpocalypse: Dead or Mispriced? 2:00 - “Reports of My Death”: Why Wix Still Has Real Assets 3:00 - Wix Harmony vs. Base44: Two Paths to AI Site Building 4:00 - Base44 vs. the AI Lab