JERUSALEM (dpa-AFX) - Website development platform Wix.com Ltd. (WIX) is cutting roughly 20% of its workforce as part of a broad restructuring aimed at adapting to the rapid rise of artificial intelligence and streamlining operations, CEO Avishai Abrahami said in a message to employees.
The Israel-based company, which had 5,277 employees at the end of the first quarter, is expected to eliminate about 1,000 jobs, marking the largest layoff round in its history.
'It also means we need to become a faster, leaner, and flatter organization. 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 said.
He described AI as the most significant technological shift in company building since the emergence of modern programming languages in the 1970s.
Abrahami also cited pressure from the strengthening Israeli shekel against the U.S. dollar, noting that most of Wix's costs are denominated in shekels while much of its revenue is generated in dollars.
'The first reason is the Shekel/Dollar rates. In the past few quarters the exchange rate between the Shekel and the US dollar has shifted significantly as the Israeli Shekel strengthens against the US Dollar almost every day. As the majority of our teams are Israel-based, a very meaningful portion of our costs are shekel-denominated, while our revenue is largely dollar-denominated. 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 company said the currency shift has created structural pressure on profitability and sustainability at its current scale.
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