WeWork warns of bankruptcy; share price crashes 38% to near zero for a valuation of just $260 million
startups are willing to enter into long-term leases for geographically fixed spaces," interim CEO David Tolley said on an analyst call on Wednesday, Reuters reported. WeWork’s business model includes taking long-term leases and renting out spaces for a short term.
The company’s net loss narrowed to $349 million in the second quarter from $577 million a year ago, but it still burned through $646 million in cash in the first six months of the year. As of the end of June, the company had $205 million cash in hand, according to the Reuters report.
WeWork has never turned profitable. Japanese conglomerate SoftBank, which is one of the major investor in WeWork, has sunk tens of billions to prop up the startup, but the company has continued to lose money.
However, WeWork’s India division said the bankruptcy warning would not affect that unit. (With inputs from Reuters)Get the best recommendations on Stocks, Mutual Funds and more based on your Risk profile!
. Read more on livemint.com
