Starboard Value LP has built a 9 percent stake in the website development platform Wix. The activist hedge fund made the announcement in a filing on Friday. Starboard made the contribution and spoke with Wix about how it could improve operations. Wix has adopted a three-year cost-cutting program to raise the price of its stranded stock.
Activist investor Starboard believes Wix has significant room to improve its margins and continue to grow, the sources said. The fund has discussed its ideas with Wix management and is not seeking board seats, the sources said. Wix reported a loss of $111.2 million in the three months ended June, compared with a profit of $37.6 million in the corresponding period of 2021.
Wix had 222 million registered users worldwide, and the web development tools, most of which are free. from the end of December. Of these, only 6 million had premium subscriptions. Starboard, led by Jeff Smith, is one of the industry’s best-known active investors and is widely recognized for its hands-on experience. It is also an investor in another website development company, GoDaddy Inc, in which it bought a stake last year.