WeWork Losses Mount But 'seismic Shift' In Office Use Seen Helping Recovery

By Herbert Lash

NEW YORK (Reuters) - WeWork Companies LLC's revenue declined but its cash burn slowed in the third quarter, a company memo showed on Thursday, as management expressed confidence the shared-workplace provider can weather the hit to the global office sector from COVID-19.

Quarterly revenue slid 8% from the second quarter to $811 million (£618 million), while the company posted negative free cash flow of $517 million, less than $671 million of cash burn a quarter ago, WeWork said in the memo to employees seen by Reuters.

WeWork said member retention improved and renewal rates stabilized with the loss of desks in September at its lowest level since March when COVID-19 shut down businesses around the world and left office buildings vacant.

The pandemic has accelerated a "seismic shift" in the office sector that has put flexibility - an industry byword for the short-term leases the company embraces - and WeWork at the forefront, the memo signed by Chief Executive Sandeep Mathrani and Chief Financial Officer Ben Dunham said.

"This is our moment, and I know that together, we will continue to define the future of work," they said.

(This story corrects to say cash burn slowed, not increased in paragraph 1, corrects figure in paragraph 2. Clarifies attribution.)

(Reporting by Herbert Lash; Editing by Sam Holmes)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor