WeWork reports quarterly loss of nearly $2.1 bln ahead of public listing (updated)

Wework

20/05/2021 23:49

(Adds details on results, background)
    May 20 (Reuters) - SoftBank-backed office-sharing startup
WeWork on Thursday reported a first-quarter net loss of $2.06
billion, as it was hit by restructuring charges while it
prepares to go public through a merger with a blank-check firm.
    WeWork said its business was recovering as more people
returned to offices due to easing of COVID-19 curbs, after 
work-from-home arrangements last year weighed heavily on the
company by reducing occupancy and increasing operating costs.
    Total occupancy ticked up to 50% in the first quarter
compared to 47% in the fourth quarter, the company said.
    WeWork in March agreed to go public through a merger with
BowX Acquisition Corp  BOWX.O , a special purpose acquisition
company, in a deal that valued it at $9 billion. SoftBank Group
Corp  9984.T  said it would retain a majority stake in the
company after the merger.  urn:newsml:reuters.com:*:nL4N2LO2G8   
    The company, whose attempt at an initial public offering in
2019 spectacularly imploded due to investor concerns over its
business model and co-founder Adam Neumann's management style,
said first-quarter revenue nearly halved to $598 million from a
year ago.
    WeWork said it had 490,000 members in the first quarter,
compared to 693,000 in March 2020.
    The company said it incurred restructuring costs of $494
million, driven by non-cash SoftBank stock purchases and a
settlement with Neumann. It posted an impairment charge of $299
million partly due to an exit out of some real estate.
   SoftBank and Neumann, WeWork's former chief executive officer
 reached a settlement in February ending a legal battle that
started in 2019 when SoftBank agreed to buy around $3 billion in
WeWork stock belonging to Neumann and other employees, but later
contested its obligation to purchase the shares.

 (Reporting by Uday Sampath in Bengaluru; Editing by Shailesh
Kuber)
 ((UdaySampath.Kumar@thomsonreuters.com; within U.S.+1 646 223
8780; Twitter: https://twitter.com/sampath_uday  ;))