WeWork posts $900 million loss as it preps for IPO
WeWork owner The We Company on Wednesday published detailed financial statements for the first time, showing it lost more than $900 million in the first half of 2019 while revenue doubled, as it steps up preparations for an initial public offering next month.
The filing with the U.S. Securities and Exchange Commission underscores We Company’s rapid growth but also the billions of dollars it is investing to fund its expansion.
The IPO, planned for as early as September, will be a test of investor appetite for fast-growing companies with massive losses at a time when stock markets are in turmoil because of the prolonged trade war between the United States and China.
We Company’s business model – largely based on short-term revenue agreements with renters, and long-term loan liabilities from the properties it leases and manages – has drawn investor skepticism.
The IPO filing provides the most comprehensive financial picture yet of the company, co-founded in 2010 by its chief executive, Adam Neumann.
Among the disclosures in the filing, We Company reported a net loss of $904.65 million in the six months ended June, compared with a loss of $722.89 million a year earlier. Some $689.7 million of the losses were attributed to WeWork, by far its largest business division.
In the same period, the company’s revenue more than doubled to $1.54 billion.
To support that growth, We Company burned through $2.36 billion in cash, more than twice the amount it spent in the same period a year earlier.
The company did not give a time frame for becoming profitable as it continues to invest in expanding its operations.