How Can an 11-Year Old Company Lose $844 Million on $661 Million in Revenues?

Now that WeWork is publicly traded after its merger in October with the SPAC, BowX Acquisition Corp., the earnings emerge, and they’re as grisly as before.

At this rate of cash burn, it’s going to run out of cash soon unless it gets a whole lot more cash by selling a whole lot more shares to investors eager to watch the amusing spectacle of their cash getting burned, or watching the even more amusing spectacle of other people’s cash getting burned.

WeWork, in its first earnings report as publicly traded company, said today that revenues fell 18% year-over-year to $661 million, from the already beaten down levels of Q3 last year. Which generated a net loss of $844 million.

How can a mature 11-year-old company lose $844 million on $661 million in revenues? Don’t they have any adults over there?

WeWork would just be better off shutting down and giving away free money. Its investors don’t seem to mind. After 11 years of burning umpteen billion dollars in cash, it still doesn’t have any idea how to get to a functional business model that doesn’t just burn cash.

For the first three quarters of 2021, the company had a net loss of $3.8 billion on $1.85 billion in revenues. Let that sink in for a moment.

Over the nearly four years since 2018, per its S-1 filing, the company had $10.5 billion in revenues and $13.6 billion in losses. This idea that there is a business model somewhere hidden in there when net losses consistently exceed revenues after 11 years in business is just stunning: