August 9, 2023 / 9:31 AMOnce worth as much as $47 billion, WeWork is now warning that there is"substantial doubt" about the company's ability to stay in business over the next year because of factors such as financial losses and a need for cash.
Shares of WeWork tumbled 2 cents, or 11%, to 19 cents in premarket trading as investors digested the Tuesday by the office-sharing company that its future is contingent upon its improving liquidity and profitability over the next 12 months. WeWork was once the biggest tenant in New York City, and made its name leasing, renovating and subleasing office space in cities nationwide. It eventually sold shares to the public in 2021, two years after a
during its first attempt to go public — which led to the ousting of its CEO and founder, Adam Neumann. "Substantial doubt exists about the Company's ability to continue as a going concern," WeWork said Tuesday."The company's ability to continue as a going concern is contingent upon successful execution of management's plan to improve liquidity and profitability over the next 12 months.
But over time its operating expenses soared and the company relied on repeated cash infusions from private investors. The company also said Tuesday it is facing high turnover rates by its members. It said it plans to negotiate more favorable lease terms, control spending and seek additional capital by issuing debt, stock or selling assets.
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