WeWork’s CEO believes the company’s performance in the fourth quarter of 2022 is a testament to the employee efforts and product value.
Commercial real estate facilitator WeWork Inc (NYSE: WE) recently reported its Q4 and fiscal 2022 results. For the period ended December 31, the leading global flexible space provider reported revenue of $848 million. This earnings growth represents an 18% increase over a year ago as WeWork maximized cost-cutting efforts. For the fourth quarter, the New York-based company also generated revenue using its budgeted foreign exchange rates of $905 million. The figure came in 26% higher year-over-year (YoY) than WeWork’s previous revenue guidance of $870-890 million.
Commenting on the WeWork Q4 2022 outing, Sandeep Mathrani, President and CEO of the company, said:
“Our fourth quarter results demonstrate that we delivered on what we aimed to do in fiscal 2022 by focusing on reducing expenses, optimizing our portfolio, increasing revenue and increasing occupancy. As a result, we passed a historic milestone of achieving adjusted EBITDA profitability in December – a testament to the hard work of our employees and the enduring value of our products.
Furthermore, Mathrani also said, “As we move forward, we are committed to building on this momentum while simultaneously enhancing our balance sheet.”
Other WeWork Q4 2022 Details
WeWork reported that physical membership grew 17% on a consolidated basis. Meanwhile, the consolidated physical occupancy increased to 75% at the end of the last three months of last year. The company also identified 56% growth in All Access and On-Demand consolidated subscriptions for the fourth quarter. Membership in the previously mentioned category currently sits at around 70,000 for the quarter.
In February, WeWork extended the maturity of the junior tranche of its LC facility from November 2023 to March 2025. In addition, the physical and virtual coworking space provider also raised the facility from $350 million to $470 million.
WeWork’s net loss for the fourth quarter was $527 million, with the company also sustaining non-cash related expenses of $348 million. The latest quarterly report also gave Adjusted EBITDA as negative $26 million, which is a 75% improvement quarter-over-quarter. Nonetheless, the 75% quarterly improvement translates to a $257 million annual improvement.
In addition to generating $973 million in systemwide revenue in the fourth quarter, WeWork’s systemwide real estate portfolio also proved expansive. For example, as of December 31 last year, the real estate portfolio consisted of 779 locations across 39 countries. This portfolio supported roughly 906,000 workstations and 682,000 physical subscriptions, 75% physical occupancy.
Meanwhile, WeWork’s consolidated real estate portfolio consisted of 622 locations across 34 countries as of December 31, 2022. In addition, this base supported approximately 731,000 workstations and 547,000 physical memberships, which also translated to 75% physical occupancy.
WeWork’s systemwide physical membership growth was 16% YoY for the quarter, while its consolidated physical membership grew 17% YoY. Furthermore, the company has projected a Q1 2023 revenue outlook of between $830 million and $855 million.
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Tolu is a cryptocurrency and blockchain enthusiast based in Lagos. He likes to strip crypto stories down to the basics so that anyone anywhere can understand without a lot of background knowledge. When he is not delving deep into crypto stories, Tolu enjoys music, loves to sing and is an avid movie lover.
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