Workspaces provided by WeWork are used by enterprises and organizations of varying sizes, ranging from sole proprietors and fledgling firms to those in the Fortune 500. As of the year 2021, the business has operations at over 700 sites worldwide, spread over 150 cities and 38 countries.
WeWork is a player in the highly fragmented office-space sector, which involves rivalry from huge organizations operating on a national or worldwide scale in addition to competition from regional and local businesses of varied sizes. International Workplace Group (IWG.L), headquartered in Switzerland; Servcorp Ltd., based in Australia; and Industrious, based in New York City; these three companies are some of the company's primary competitors.
The Financials of WeWork
WeWork reported its financial statistics for the fourth quarter of its fiscal year (FY) 2021, which concluded on December 31, 2021, in March. Since the firm had been publicly traded on October 20, 2021, as a consequence of a SPAC merger, this was the first formal reporting of the company's financial statements. The next day saw the beginning of trading for WeWork's shares on the New York Stock Exchange (NYSE). The annual net loss for the corporation in FY 2021 was $4.4 billion, a significant increase from the annual net loss of $3.1 billion in FY 2020. Annual sales plummeted 24.8 percent to $2.6 billion.
WeWork is a relatively new corporation with an eye toward expansion. It is prepared to forego profitability soon to devote resources to extend its share of the office-space leasing market. As a result, it is also ready to forgo profitability in the long run. According to the information provided by the corporation, in 2021, it occupied around 0.5 percent of all commercial office space in the United States and, accordingly, in Europe.
WeWork's Business Segments
WeWork is comprised of a single operational business division. On the other hand, it breaks down its income geographically into four distinct regions: the United States, the United Kingdom, Japan, and other nations outside Japan. In the past, WeWork presented a distinct revenue breakdown for a Greater China area. However, on October 2, 2020, the firm's Chinese business was deconsolidated since the company sold shares in the business. Following the sale of its shares, WeWork was no longer the principal benefactor of the company's success. However, the corporation maintains a presence in China with few facilities.
America (United States)
WeWork's facilities and activities in the United States brought in Money of $1.1 billion during the fiscal year 2021, which was 31.8 percent less than the previous year. The revenue generated in the United States amounted to roughly 45 percent of the overall revenue generated by the firm for the year.
The revenue generated by WeWork's sites and activities in the United Kingdom had a 17.6 percent decline compared to FY 2020. The United Kingdom area contributed around 14 percent of the total revenue to the corporation, with a total of $347.3 million.
WeWork's facilities and activities in Japan brought in an income of $211.7 million during the fiscal year 2021, 15.6 percent less than the amount brought in during the previous year. The area contributed a more than eight percent share of total income.
Other International Countries
WeWork also has activities and sites in several other international nations, some of which are located in Latin America, Europe, the Middle East, and Africa. These countries include Canada, China, India, Israel, and others. Revenue of $862.3 million was created by the firm's sites and activities in various other international nations. This figure represents about 34 percent of the total revenue earned by the company. The revenue in this area increased by 1.2 percent throughout the fiscal year 2021, making it the only geographic region to see growth in that period.
In the short term, WeWork will continue to require infusions of cash to continue its aggressive growth trajectory; however, the company may find it more difficult to acquire such cash in the future than it has in the past. This is even though the company is still actively seeking a route to profitability in the long term.
SoftBank, the firm's biggest single investor, was the solution to WeWork's financial demands in the past; however, ties between the coworking startup and the Japanese investment behemoth seem to have evolved. In the past, SoftBank was the obvious response to WeWork's financial needs. In January 2019, SoftBank reduced an investment that it had intended to make of $16 billion to merely $2 billion. Some people have argued that this change implies a reevaluation of the profit potential of The We Company. WeWork has made it clear to the public that the company is unconcerned with the shift in the amount of the agreement.