WeWork’s restructuring has helped to stem losses over the first quarter, and its chief executive has said it is now on “the runway to deliver”.
The flexible workspace provider made a net loss of $299m (£237m), which was a $205m improvement on the previous year. Adjusted EBITDA was a loss of $29m, up from a loss of $212m the previous year. Revenue for the first quarter was up 11%, to $849m.
CEO and chair Sandeep Mathrani said: “Over the past quarter we have continued to improve the fundamentals of our business while working to meet the needs of current and future members who seek turnkey, cost-efficient solutions for their office needs.”
He added: “The slight decline in memberships was a function of known enterprise client churn, the closure of some of our locations and the franchising of our South Africa business. April saw a reversal in enterprise demand resulting in USC’s first positive net sales month in 12 months.”
WeWork has now completed its previously announced debt restructuring, with new funding and capital commitments of more than $1bn, and total debt reduced by approximately $1.2bn.
“Critically, following our debt restructuring, we now have a strengthened balance sheet and liquidity position that gives us the runway to deliver against our plan,” Mathrani added. “Our debt restructuring was backed by a large majority of bondholders and investors, demonstrating their conviction in the WeWork business model and our future.”
WeWork’s real estate portfolio consists of 781 locations across 39 countries. It has approximately 904,000 workstations and 664,000 physical memberships, equating to 73% physical occupancy, with an increase in physical memberships of 6% year-over-year.
WeWork said it expects Q2 revenue to be $840m to $865m and adjusted EBITDA to be somewhere between a $10m loss and a $15m gain.
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