WeWork, whose logo is emblazoned on Atlanta’s iconic Centennial Tower overlooking downtown, announced Thursday it is laying off more than 2,000 employees as the office-sharing company struggles to survive.
WeWork confirmed to CNBC the cuts were being made to "create a more efficient organization" and refocus on the company's major office-sharing business.
“The process began weeks ago in regions around the world and continued this week in the U.S.,” a WeWork spokesperson said. “This workforce reduction affects approximately 2,400 employees globally, who will receive severance, continued benefits and other forms of assistance to aid in their career transition.”
WeWork lost $1.25 billion in the third quarter. The company was planning to go public, a plan that has since been abandoned.
The losses outpaced a 94% spike in revenue, which reached $934 million in the same period compared with last year.
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The figures were included in a report to debtholders obtained by The Associated Press.
WeWork added 103 office-sharing locations during the third quarter. It now has 625 locations in 127 cities around the world. WeWork makes money by leasing buildings and dividing them into smaller spaces, which it then leases to members on a flexible, short-term basis.
After its public offering was scrapped, WeWork’s biggest investor, Softbank, stepped in with $9.5 billion in equity and debt financing that gave the Japanese tech conglomerate almost 80% ownership of WeWork.
WeWork intends to focus on building up that clientele because it provides more stable recurring revenue than the smaller companies, startups and freelancers that make up most of its members.
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