In February, Mr. Claure set a goal of achieving operational profitability by the end of next year and said that WeWork remains on track to achieve it.
The New York-based company, which abandoned its initial public offering last year, has taken aggressive steps to reduce cash consumption and cut costs. It cut its workforce from 14,000 people last year to 5,600 people, a figure that has not been released before.
“Everyone thought WeWork was an impossible mission. [That we had] zero chance. And now, in a year, you will see WeWork as a profitable business with an incredible diversity of assets, ”said Claure.
While the shift to working from home has resulted in a reduction in the demand for office space, some companies have turned to WeWork to provide satellite offices closer to where their employees live and to distribute their staff around the world. beyond their main offices, said Claure.
Mastercard, ByteDance, owner of TikTok, Microsoft and Citigroup are among the companies that have signed new leases with WeWork in the past month.
“We have companies like Facebook, Google and Amazon who have told their employees they can work wherever they are. We have a lot of these employees who basically come to a WeWork facility to use it one day, one week, two days per week, three days per week, ”added Claure.
However, other tenants refused to pay the rent or asked to terminate their lease during the pandemic. WeWork spent $ 482 million in cash in the first three months of the year, reducing its cash to less than $ 4 billion.
He has not yet released his second quarter sales figures to his creditors, but Claure said revenues were stable during the crisis. WeWork significantly slowed its expansion last year after investing capital.
The company’s outstanding $ 669 million in debt has rebounded in the past two months, trading at 49 cents a dollar last week. Although this figure is down from the 89 cents it traded in February and remains deeply in distress, it is up 42% from the March trough, Finra data showed.
Mr. Claure’s optimistic assessment comes just nine months after SoftBank, where Mr. Claure is chief operating officer, intervened with a multi-billion dollar rescue program to prevent WeWork from running out of money. SoftBank and WeWork are still in dispute over the bailout, which included a $ 3 billion share buyback that was never consumed.
The near collapse of the office group ultimately prompted Masayoshi Son, founder of SoftBank, to admit that his initial investment in WeWork had been a mistake. The Japanese technology and telecommunications group paid more than $ 10 billion to the office company, whose valuation rose from $ 47 billion in early 2019 to $ 2.9 billion in March.
Claure, who is reputed to have overthrown US wireless service provider Sprint and negotiated its merger with rival T-Mobile, was appointed president in October after WeWork co-founder Adam Neumann left his company. post of general manager. The company hired real estate veteran Sandeep Mathrani this year and encouraged him to cut costs and put the company on the path to profitability.
WeWork sold non-core businesses like the Flatiron School Coding Academy, the Teem software company and its stake in the co-working start-up The Wing, and also terminated rental contracts on properties in Baltimore and At New York. Mathrani told staff last week that the restructuring he had started in February, which included thousands of layoffs, had been completed, according to a memo seen by the FT.
In June, the company had its strongest month of sales since February, Mathrani’s note showed, and WeWork spent more than $ 20 million to renovate spaces to keep customers away from each other.
“Our demand for private space goes through the roof,” said Claure. “Perhaps the buildings will not be as dense as before for the community side of the business. But the demand for high quality and sanitized workspaces, [make] people feel comfortable will be at an all time high. “