WeWork drops billions in the third quarter

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WeWork

With cost reductions, the office landlord wants to return to profitability.


(Photo: Reuters)

new York The US office space leasing company suffered larger losses in the third quarter than in the previous year. Net loss increased to $ 1.25 billion from $ 497 million a year ago, according to parent company WeWork Company. As the business figures show, the loss is due to the opening of 97 new locations.

Gross revenue from office sales and service revenue increased to $ 808 million in the third quarter from $ 454 million in the year-ago quarter. After the failure of the WeWork stock market plans, the Japanese technology investor Softbank had invested more than ten billion dollars in the company and increased its share from around one third to 80 percent.

Without the cash injection from Japan, According to insiders, WeWork would have run out of money in just a few weeks. Overall, the start-up after the capital injection is valued at only eight billion dollars. A few weeks ago, the company had planned for the planned IPO $ 47 billion – but the investors got cold feet.

The IPO was canceled because there was no demand on Wall Street for the high-rated, but also highly-deficient start-up. WeWork CEO Adam Neumann had to vacate the lead post. Softbank and other investors have de-trusted Neumann. His successor is the current T-Mobile US boss John Legere in conversation.

The office landlord now wants to get back on track with cost reductions. As part of a restructuring plan, WeWork plans to lay off up to 4,000 employees, according to the Financial Times (FT). That would be about one third of the global workforce.

Softbank CEO Masayoshi Son said he continues to believe in WeWork's business model, which changes the way people work. "We remain committed to WeWork, its employees, customers and landlords."

More: Why WeWork is far from being saved, read here.

. (tagsToTranslate) WeWork (t) Office landlords (t) Real Estate (t) Financial Figures (t) Losses (t) Quarter (t) Real Estate Market (t) Going public (t) Office Organization (t) Company Formation (t) Workplace (t) Internet Company (t) Softbank (t) T-Mobile (t) Adam Neumann (t) Commercial real estate

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