Automattic (WordPress.com)
Parent of WordPress.com and Tumblr, powers about 42% of all websites through WordPress software.
On the record
Checkpoint: WP Engine v. Automattic litigation outcome or settlement
The call
Automattic still runs a huge share of the web's existing sites, but new sites are increasingly built elsewhere, and layoffs plus legal fights are piling up at the same time.
Automattic owns WordPress.com and influences WordPress, the free software that runs nearly half of all websites. The company makes money by hosting sites, selling add-ons like storage and premium themes, and providing commerce tools. Wix and Shopify are winning new customers because they are easier to use and require no coding, while WordPress has become harder to compete with as more drag-and-drop website builders and AI tools (like Lovable and Bolt.new) let people build sites without learning WordPress at all. The biggest question is whether WordPress's share of new websites keeps shrinking over the next few quarters, and what happens in Automattic's lawsuit against WP Engine, a major hosting company, because a ruling against Automattic could strip away its control over the WordPress plugin store and updates.
Why
01
AI pressure: AI-native site builders like Lovable, Bolt.new, Vercel v0. AI tools let anyone generate a working site by typing a prompt, skipping WordPress entirely for new projects. Could AI do the core job? Only partly.
02
Bigger players: Wix and Shopify. Wix grew 32.6% year over year while WordPress's overall share slipped from 43.6% to 42.4% in under a year. Could a giant copy it? No, they are blocked.
03
What protects it. Millions of existing sites, plugins, and hosting setups are too costly and risky to migrate off WordPress.
What would change this call
WordPress's global CMS share over the next two to three quarters. Continued decline below ~60% would confirm accelerating loss of new sites to Wix and Shopify.
Outcome or settlement of the WP Engine v. Automattic litigation. A ruling limiting Automattic's control of WordPress.org would weaken its ecosystem moat.
Whether Automattic raises new equity or confirms a valuation near or below the $7.5B 2021 mark. A markdown or failed raise would show investor confidence eroding further.
Outcome or settlement of the WP Engine v. Automattic litigation. A ruling limiting Automattic's control of WordPress.org would weaken its ecosystem moat.
Whether Automattic raises new equity or confirms a valuation near or below the $7.5B 2021 mark. A markdown or failed raise would show investor confidence eroding further.
Key numbers
- WordPress share fell to 42.4% of websites
- Wix grew 32.6% year over year
- Staff cut 16% in April 2025 after 8.4% buyout in Oct 2024
Named risks
- WordPress's first sustained market share decline in 20+ years, with Wix and Shopify taking net new sites.
- Active WP Engine litigation naming Mullenweg personally, with defamation and unfair competition claims proceeding.
- Two rounds of layoffs in 2024-2025 (8.4% then 16%) signal financial strain and cost cutting.
- Tumblr's ongoing losses (~$30M/year) and shelved migration plans drag on the broader portfolio.
- Stale $7.5B valuation from 2021 with reported BlackRock markdown, no confirmed new equity round since.
Rivals, as read in July 2026
| Rival | Direction | Evidence |
|---|---|---|
| Wix | losing to | Wix grew 32.6% YoY as of July 2026 while WordPress CMS share fell to ~59.8-60.7% |
| Shopify | losing to | Shopify steadily gaining CMS share, directly competing with WooCommerce as of mid 2026 |
| AI native builders (Lovable, Bolt.new, Vercel v0) | losing to | Threaten WordPress.com's new site creation funnel despite Automattic's own AI features shipped through March 2026 |
| Squarespace | contesting | Acquired by Permira for $7.2B in October 2024, remains design focused site builder competitor |
| WP Engine | contesting | Active litigation since October 2024; June 2026 ruling found Mullenweg 'evasive' in deposition |
Questions people ask
- Is Automattic profitable in 2026?
- Automattic does not disclose audited financials. Aggregator estimates put 2024 revenue near $710M with about 11% YoY growth (vendor-claimed), but Tumblr alone loses roughly $30M a year and CEO Matt Mullenweg called it his biggest failure in October 2025, suggesting overall profitability is uncertain.
- Is WordPress losing market share to Wix and Shopify?
- Yes. Independent W3Techs based tracking shows WordPress's CMS market share fell from 65.2% in 2022 to about 59.8 to 60.7% by mid 2026, while Wix grew 32.6% year over year as of July 2026, marking WordPress's first sustained decline in over 20 years.
- Has Automattic had layoffs?
- Yes, twice. In October 2024, 159 employees (8.4% of staff) took a voluntary buyout, and on April 2, 2025 Automattic laid off about 16% of remaining staff, roughly 279 to 281 people, cutting headcount from about 1,774 to 1,495.
- Could AI replace WordPress developers and site builders?
- Automattic's own AI tools, including the Big Sky site builder (April 2025) and native AI Assistant (February 17, 2026), already automate layout, design and first draft content, work traditionally done by freelance WordPress developers and theme designers, per trade press coverage.
- Who is Automattic's biggest competitor threat?
- Wix and Shopify are actively taking new site creation share; Wix grew 32.6% year over year as of July 2026 per W3Techs based data, while AI native builders like Lovable and Bolt.new threaten the 'build me a site' funnel that feeds WordPress.com growth.
- What is Automattic's current valuation?
- The last confirmed valuation is $7.5 billion from a February 2021 round with BlackRock, Wellington and Schonfeld as investors. No new equity round has been publicly confirmed since, and BlackRock reportedly marked down its stake by 10% in late 2024.
Timeline
- 2026-06-08Court finds Mullenweg 'evasive' in deposition; discovery disputes ongoing in WP Engine case
- 2026-05-06Developer Michael Willman's contempt motion against Automattic/Mullenweg denied with prejudice
- 2026-03-20Automattic launches MCP write capabilities letting AI agents edit and publish WordPress.com content
- 2026-02-17WordPress.com launches native in editor AI Assistant for layout, style and content editing
- 2026-01-14Motion to dismiss granted in Keller v. Automattic; amended complaint due
- 2025-10-20CEO Mullenweg calls Tumblr his 'biggest failure', says it loses money
- 2025-07-16Automattic acquires Beeper for $125M and Texts.com for $50M
- 2025-04-02Automattic lays off about 16% of remaining staff, headcount 1,774 to 1,495
- 2024-12-01Preliminary injunction in WP Engine v. Automattic case goes against Automattic
- 2024-10-31159 employees (8.4% of staff) take voluntary buyout amid WP Engine dispute turmoil
Revision history
23 July 2026
First assessed. Losing its protection. The text above is fixed as of this date and is not edited afterwards.
In the same band
Sources
- WordPress Statistics 2026: What the Numbers Actually Tell You (2026-04-27)
- CMS Market Share: Who's Up, Who's Down (2026-07-09)
- WordPress.com parent Automattic raises $300 million from Salesforce at a $3 billion valuation (2019-09-19)
- $710M Est. ARR, $7.5B Valuation (2026-07-03)
- Automattic - $300M Raised (2026-06-24)
- Automattic CEO's Billion Dollar Confession
- Automattic Cuts 16% of Workforce (2025-04-13)
- WordPress maker Automattic lays off 16% of staff (2025-04-10)
- Automattic Number of Employees 2026 (2026-06-29)
- Automattic is pulling back on investing in Tumblr, which loses $30 million a year
- Automattic CEO calls Tumblr his 'biggest failure' so far (2025-10-20)
- tumblr.com Website Traffic, Ranking, Analytics [January 2026] (2026-02-11)