The American office lessor WeWork again suffered a loss in the fourth quarter. The company wants to reduce the loss in the current quarter. CEO Sandeep Mathrani is cutting costs deeply and a major round of layoffs was announced last month.
The New York-based company, which is also active in the Netherlands, suffered a loss of 527 million dollars (493 million euros) last quarter. That was more than the $328 million shortfall analysts had projected. The turnover of 848 million dollars was also lower than experts had expected.
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Mathrani stated upon taking office in 2020 that WeWork was on track to be profitable by the end of 2021, but that is still not the case. When releasing third-quarter earnings, he said the company should be on track to positive cash flow by 2023. Cash flow is the difference between the money coming in and going out of a company.
For the first quarter, WeWork hopes for its operating profit, which is still adjusted for a number of items, for a loss of $ 25 million or, at best, a break-even result. The latter is the point at which a company no longer makes a loss, but also does not yet make a profit. To get to that point, cutbacks are needed. In addition to cutting jobs, WeWork is also terminating leases on dozens of buildings that no longer make financial sense.
WeWork is seeing the occupancy rate of its buildings slowly improve after the collapse during the nadir of the corona pandemic. The occupancy rate reached 75 percent in the December quarter, compared to 71 percent in the previous three months.