Again, the We Company’s revenue and losses mount

The flexible-office-space giant reported $220M in negative EBITDA in Q1, more than double a year ago
By David Jeans | May 15, 2019 05:45PM

The We Company CEO Adam Neumann (Credit: Getty Images and iStock)

The We Company CEO Adam Neumann (Credit: Getty Images and iStock)

In providing a window into the We Company’s financial position ahead of a planned initial public offering, the $47 billion company reported $728 million in revenue, more than double that of the first quarter of 2018. Its net losses totaled $264 million, narrowing from $274 million last year, which is partly attributed to a $367 million one-time gain the company realized.

But the We Company’s adjusted EBITDA losses more than doubled, increasing to $220 million from $106 million year over year. That figure included $31 million in merger and acquisition fees and inventory write-off costs, the company said. The company said its total cash and cash commitments dropped to $5.9 billion, down from $6.6 billion at the start of the year, a signal of the company’s move to offset losses.

The firm’s total member count jumped to 466,000 individual customers in the first quarter, during which time WeWork added 50 locations.

The latest financials continue a trend for the flexible office firm, which reported that both revenue and losses doubled last year to $1.82 billion and $1.93 billion respectively.

Alongside those metrics, the company’s spending on marketing almost tripled, while its occupancy rates and average revenue per member took a hit. Both of these negative indicators have been blamed on the company’s focus on global expansion; 57 percent of its locations are now outside the United States.

The earnings were announced the same day the We Company announced the launch of its real estate investment arm, ARK, which has $1 billion in backing from Ivanhoe Cambridge. It is hoping to raise a total $2.9 billion to buy real estate assets.