Office and coworking space rental company WeWork has acknowledged that “there is substantial doubt” about its ability to continue business. The news has caused the company to fall above 20% in the pre-opening of the market.
The losses keep piling up. In the second quarter of the year they have been 349 million dollars, some 320 million euros, 39.5% less than in the same period of 2022, but the company has spent four years struggling to be profitable without success, hit by its own problems and the covid.
“As a result of the losses and cash needs, combined with higher customer turnover and liquidity levels, there is substantial doubt about the company’s ability to continue as a business,” he admitted when presenting his second-quarter accounts. .
In the second quarter of 2023, WeWork’s turnover reached 844 million dollars (769 million euros), 3.5% more than a year ago. But expenses have risen by 5.6%, to 1,195 million dollars (1,089 million euros).
The sum of the losses in the first six months of the year is 613 million dollars (559 million euros), half that of a year ago. Revenues up to June were 1,693 million dollars (1,543 million euros), representing an increase of 7.1%.
“In a difficult operating environment, we have achieved strong year-over-year revenue growth and dramatic improvements in profitability,” WeWork interim CEO David Tolley said in any case.
For Tolley, the supply of commercial real estate, increased competition in flexible spaces and macroeconomic volatility have led to higher turnover and weaker-than-expected demand. Since its IPO the company has lost 98% of the value.
