WeWork has revealed bad news about its future prospects, saying there is “substantial doubt” about it “ability to continue as a going concern.”

WeWork set out to revolutionize the office space, providing a way for companies and freelancers alike to rent work space as needed. Despite its promise, the company has been plagued with issues and criticisms, including concerns over its ability to be profitable.

In its latest quarterly results, the company adds fuel to the fire, admitting there is “substantial doubt” about its future viability:

In addition, as disclosed in WeWork’s Quarterly Report for the three and six months ended June 30, 2023 (the “Second Quarter 10-Q”), as a result of the Company’s losses and projected cash needs, combined with increased member churn and current liquidity levels, substantial doubt exists about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is contingent upon successful execution of management’s plan to improve liquidity and profitability over the next 12 months.

The company outlines a multi-step plan to improve profitability, including reducing rent costs, reducing member churn, increasing sales, and seeking out additional capital.

“In a difficult operating environment, we have delivered solid year-over-year revenue growth and dramatic profitability improvements,” David Tolley, Interim Chief Executive Officer, commented. “Excess supply in commercial real estate, increasing competition in flexible space and macroeconomic volatility drove higher member churn and softer demand than we anticipated, resulting in a slight decline in memberships.”

“We are confident in our ability to meet the evolving workplace needs of businesses of all sizes across sectors and geographies, and our long term company vision remains unchanged,” continued Tolley. “Although we have more work to do, the talent and energy of the WeWork team is extraordinary and we are resolutely focused on delivering for our members for the long term. The company’s transformation continues at pace, with a laser focus on member retention and growth, doubling down on our real estate portfolio optimization efforts, and maintaining a disciplined approach to reducing operating costs.”