EX-99.1

EX-99.1 2 d311051dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

WeWork Reports Fourth Quarter and Fiscal Year 2021 Financial Results

NEW YORK, March 11, 2022 – WeWork Inc. (NYSE: WE) (“WeWork”), a leading global flexible space provider, today reported financial results for its fourth quarter and fiscal year ending December 31, 2021.

•

For fiscal year 2021, consolidated gross desk sales totaled 593,000, the equivalent of 35.6 million square feet.

•

Total revenue for the fourth quarter 2021 was $718 million, an increase of $57 million quarter-over-quarter.

•

Occupancy in the fourth quarter 2021 increased 6 points quarter-over-quarter to 66%, including sold but not yet occupied memberships.

Company Operating Results

•

As of December 31, 2021, WeWork’s systemwide real estate portfolio consisted of 756 locations across 38 countries, supporting approximately 912,000 workstations and 590,000 physical memberships.

•

As of December 31, 2021, WeWork’s consolidated real estate portfolio included 624 locations across 33 countries, supporting approximately 746,000 workstations and 469,000 physical memberships.

•

Systemwide gross desk sales totaled 217,000 in the fourth quarter 2021, equating to 13.0 million square feet sold. Consolidated gross desk sales totaled 164,000 in the fourth quarter, equating to 9.9 million square feet sold. Consolidated new desk sales totaled 87,000 in the fourth quarter.

•

Physical occupancy continued to trend upwards to 63% as of year-end 2021. Physical occupancy including signed but not yet occupied memberships was 66% as of year-end 2021, up from 60% at the end of the third quarter 2021.

•

The average revenue per member (ARPM) for physical memberships was $484 in the fourth quarter, roughly flat quarter-over-quarter as compared to the third quarter ARPM of $485.

•

All Access memberships increased to 45,000 by the close of the fourth quarter, an increase of 41% quarter-over-quarter. These All Access memberships represent an incremental 6 percentage points in occupancy.

Company Consolidated Financial Results

•

Fourth quarter 2021 revenue was $718 million, representing a 9% increase from $661 million in the third quarter and the second consecutive quarter of sequential revenue growth.

•

Fourth quarter 2021 Operating Cash Flow was negative $373 million and Free Cash Flow was negative $467 million.

•

Net Loss was $803 million in the fourth quarter 2021, a 5% improvement relative to the third quarter 2021. Net loss net of $103 million of interest and other (income) expense, restructuring costs of negative $48 million driven by net gains on lease terminations, impairment of $241 million driven by building exits and depreciation and amortization of $174 million, stock-based compensation of $48 million, and $2 million of other costs, resulted in Adjusted EBITDA of negative $283 million.

•

Adjusted EBITDA was negative $283 million, a $73 million improvement from third quarter 2021 and a $189 million improvement relative to the fourth quarter 2020.

Space-as-a-Service:

WeWork reported systemwide gross desk sales of 217,000 in the fourth quarter 2021, an equivalent of 13.0 million square feet sold, including 113,000 new desk sales. On a consolidated basis, gross desk sales were 164,000 in the fourth quarter 2021, which equates to approximately 9.9 million square feet sold including 87,000 new desk sales. For the fiscal year 2021, consolidated gross desk sales totaled 593,000, an equivalent of 35.6 million square feet sold.

WeWork continued to represent a significant portion of traditional office leasing activity in 2021. WeWork represented approximately 0.5% of all commercial office space in the U.S., and sold the equivalent of 9% of total traditional office square feet leased across the country in 2021.

At the market-level, WeWork’s 2021 gross sales in Manhattan were equivalent to 16% of the traditional office market leasing on a square-foot basis, while WeWork’s portfolio of 5 million square feet in Manhattan accounts for approximately 1% of total office stock. WeWork’s leasing activity represented 17% of Boston’s total square feet leased in the year, 13% of San Francisco total square feet leased, and 14% of Miami’s total square feet leased, despite representing 2% or less of the total office stock in each of those markets.

Across the Company’s European markets, WeWork represented approximately 0.5% of commercial office space, yet sold the equivalent of 8% of total square feet leased in 2021. WeWork’s gross sales in 2021 equated to 39% of London’s traditional office leasing, a market that is leading the shift to flex, 34% of Dublin’s leasing, 8% of Paris’ leasing and 6% of Berlin’s leasing.

WeWork saw sequential gains in occupancy throughout fiscal year 2021. As of December 2021, WeWork’s consolidated physical memberships increased to 469,000, a quarter-over-quarter increase of 9% and year-over-year increase of 21%. Physical occupancy rose to 63% in the fourth quarter 2021, a 7 percentage point increase from the third quarter 2021. Including the incremental 21,000 net memberships already contracted for move-in, physical occupancy including signed but not yet occupied memberships would increase to 66% as of year-end 2021.

WeWork Access:

All Access represented 45,000 memberships as of December 2021, an increase of 41% quarter-over-quarter. As of the fourth quarter, All Access ARPM was approximately $230 per month and WeWork Access achieved a run-rate revenue of approximately $120 million.

WeWork Workplace:

WeWork continues to develop and refine WeWork Workplace, its workspace management software solution for enterprises and operators. For enterprises, the platform intends to enable a seamless and purposeful hybrid work experience by powering online booking, providing meaningful utilization analytics, and helping to optimize space across assets.

In December 2021, WeWork signed its first WeWork Workplace enterprise deal with Organon, a global leader in women’s health, to action their boundaryless workplace strategy across locations in 34 cities that are a mix of WeWork locations, owned locations, and non-WeWork locations.

Business Development:

WeWork continues to identify business development opportunities that align with the company’s overall strategy for accretive and asset-light growth, with a focus on operators with a strong product and cultural fit.

In line with that approach, WeWork announced the acquisition of Common Desk in January 2022. Common Desk, a Dallas-based coworking operator with 23 locations in Texas and North Carolina, operates a majority of its locations under asset-light management agreements with landlords that minimize the Company’s operational and capital expenses. The deal closed in March 2022.

In February 2022, WeWork announced a strategic investment in and partnership with Upflex, a platform that aggregates over 4,800 coworking locations around the world. Through the strategic investment, WeWork is able to increase the physical network of spaces available to Access members without added incremental capital investments. Additionally, WeWork will be the exclusive flex workspace operator to sell Upflex inventory to its members, creating an opportunity for WeWork to service members across Upflex’s vast network of third-party spaces in markets where WeWork does not operate.

Liquidity:

WeWork ended the year with $1,974 million in cash and unfunded cash commitments, including approximately $924 million of available cash on hand, $550 million available under our senior secured note facility, and an additional $500 million in letter of credit facility capacity.

Outlook:

WeWork expects to deliver between $3.8 and $4.0 billion systemwide revenue in 2022. On a consolidated basis, the company expects to deliver between $3.35 and $3.5 billion revenue in 2022, including between $740 and $760 million of revenue in Q1 and between $775 and $825 million of revenue in Q2. In Q3 and Q4, the Company expects to achieve revenue of between $900 million and $1 billion, which is the range the Company expects to become Adjusted EBITDA positive. The Company expects that its 2022 beginning cash and available liquidity balance of $1.974 billion, adjusted for the midpoint of the Company’s Adjusted EBITDA guidance of negative $450 million, $240 million of interest, and $200 million of net capex will give the Company total liquidity of approximately $1.1 billion by the end of fiscal year 2022.

###

Investors

Chandler Salisbury

investor@wework.com

Media

Nicole Sizemore

press@wework.com

About WeWork

WeWork Inc. (NYSE: WE) was founded in 2010 with the vision to create environments where people and companies come together and do their best work. Since then, we’ve become one of the leading global flexible space providers committed to delivering technology-driven turnkey solutions, flexible spaces, and community experiences. For more information about WeWork, please visit us at wework.com.

Forward-Looking Statements

Certain statements made in this press release may be deemed “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, as amended. These forward looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “strategy,” “future,” “opportunity,” “plan,” “pipeline,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions and, as a result, are subject to risks and uncertainties. Although WeWork believes the expectations reflected in any forward-looking statement are based on reasonable assumptions, it can give no assurance that its expectations will be attained, and it is possible that actual results may differ materially from those indicated by these forward-looking statements due to a variety of risks, uncertainties and other factors. Such factors include, but are not limited to, WeWork’s ability to refinance, extend, restructure or repay near and intermediate term debt; its indebtedness; its ability to raise capital through equity issuances, asset sales or the incurrence of new debt; retail and credit market conditions; impairments; its liquidity demand; changes in general economic conditions, including as a result of the COVID-19 pandemic; delays in customers and prospective customers returning to the office and taking occupancy as a result of the COVID-19 pandemic and the emergence of variants leading to a parallel delay in receiving the corresponding revenue; and WeWork’s inability to implement its business plan

or meet or exceed its financial projections. Forward-looking statements speak only as of the date they are made. WeWork discusses these and other risks and uncertainties in its annual and quarterly periodic reports and other documents filed with the U.S. Securities and Exchange Commission. WeWork may update that discussion in its periodic reports, but otherwise takes no duty or obligation to update or revise these forward-looking statements, whether as a result of new information, future developments, or otherwise.

Use of Non-GAAP Financial Measures

This press release includes certain financial measures not presented in accordance with generally accepted accounting principles in the United States (“GAAP”), including Building Margin, Adjusted EBITDA and Free Cash Flow (including on a forward-looking basis). These financial measures are not measures of financial performance in accordance with GAAP and may exclude items that are significant in understanding and assessing our financial results. Therefore, these measures should not be considered in isolation or as an alternative to net loss or other measures of profitability, liquidity or performance under GAAP. You should be aware that WeWork’s presentation of these measures may not be comparable to similarly titled measures used by other companies, which may be defined and calculated differently. WeWork believes that these non-GAAP measures of financial results (including on a forward-looking basis) provide useful supplemental information to investors about WeWork. WeWork’s management uses forward-looking non-GAAP measures to evaluate WeWork’s projected financials and operating performance. Additionally, to the extent that forward-looking non-GAAP financial measures are provided, they are presented on a non-GAAP basis without reconciliations of such forward-looking non-GAAP measures due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliations.

Non-GAAP Financial Definitions

Adjusted Earnings Before Interest Expense, Income Tax, Depreciation, and Amortization (“Adjusted EBITDA”)

We also supplement our GAAP results by evaluating Adjusted EBITDA, a non-GAAP measure. We define “Adjusted EBITDA” as net loss before income tax (benefit) provision, interest and other (income) expense, depreciation and amortization expense, stock-based compensation expense, expense related to stock-based payments for services rendered by consultants, income or expense relating to the changes in fair value of assets and liabilities remeasured to fair value on a recurring basis, expense related to costs associated with mergers, acquisitions, divestitures and capital raising activities, legal, tax and regulatory reserves or settlements, significant legal costs incurred by WeWork in connection with regulatory investigations and litigation regarding WeWork’s 2019 withdrawn initial public offering and the related execution of the SoftBank Transactions, as defined in Note 1 of the Notes to the Consolidated Financial Statements included in our Quarterly Report for the quarter ended September 30, 2021, net of any insurance or other recoveries, significant non-ordinary course asset impairment charges and, to the extent applicable, any impact of discontinued operations, restructuring charges, and other gains and losses on operating assets.

Free Cash Flow

We also supplement our GAAP results by evaluating Free Cash Flow, a non-GAAP measure. Free Cash Flow is defined as cash flow from operating activities less cash purchases of property and equipment, each as presented in WeWork’s Consolidated Statements of Cash Flows calculated in accordance with GAAP. Free Cash Flow is both a performance measure and a liquidity measure that we believe provides useful information to management and investors about the amount of cash generated by or used in the business. Free Cash Flow is also a key metric used internally by our management to develop internal budgets, forecasts and performance targets.

WEWORK INC.

CONSOLIDATED BALANCE SHEETS

UNAUDITED


	December 31,
(Amounts in thousands, except share and per share amounts)	2021		2020
Assets
Current assets:
Cash and cash equivalents	$	923,725	$	800,535
Accounts receivable and accrued revenue, net of allowance of $62,515 and $107,806 as of December 31, 2021 and 2020, respectively		129,943		176,521
Prepaid expenses (including related party amounts of $1,178 and $557 as of December 31, 2021 and 2020, respectively)		179,666		162,843
Other current assets (including related party amounts of $1,897 and $780 as of December 31, 2021 and 2020, respectively)		238,109		189,329

Total current assets		1,471,443		1,329,228
Property and equipment, net		5,374,225		6,859,163
Lease right-of-use assets, net		13,052,091		15,107,880
Restricted cash		11,274		53,618
Equity method and other investments		199,577		214,940
Goodwill		677,334		679,351
Intangible assets, net		56,729		49,896
Other assets (including related party amounts of $596,045 and $699,478 as of December 31, 2021 and 2020, respectively)		913,498		1,062,258

Total assets	$	21,756,171	$	25,356,334

Liabilities
Current liabilities:
Accounts payable and accrued expenses (including amounts due to related parties of $93,800 and $14,497 as of December 31, 2021 and 2020 respectively)	$	621,090	$	723,411
Members’ service retainers		420,908		358,566
Deferred revenue (including amounts from related parties of $5,441 and $9,717 as of December 31, 2021 and 2020, respectively)		119,767		176,004
Current lease obligations (including amounts due to related parties of $18,433 and $10,148 as of December 31, 2021 and 2020, respectively)		893,067		847,531
Other current liabilities (including amounts due to related parties of none and $900 as of December 31, 2021 and 2020, respectively)		77,913		83,755

Total current liabilities		2,132,745		2,189,267
Long-term lease obligations (including amounts due to related parties of $524,625 and $436,074 as of December 31, 2021 and 2020, respectively)		17,925,626		20,263,606
Unsecured notes payable (including amounts due to related parties of $1,650,000 and $1,200,000, as of December 31, 2021 and 2020, respectively)		2,200,000		1,200,000
Warrant liabilities, net (including convertible related party liabilities, net of none and $418,908 as of December 31, 2021 and 2020, respectively)		15,547		418,908
Long-term debt, net		665,598		688,356
Other liabilities		230,097		221,780

Total liabilities		23,169,613		24,981,917
Commitments and contingencies (Note 23)
Convertible preferred stock; no shares authorized, issued and outstanding as of December 31, 2021, and 782,507,467 shares authorized, 304,791,824 shares issued and outstanding as of December 31, 2020		—		7,666,098
Redeemable noncontrolling interests		35,997		380,242

WEWORK INC.

CONSOLIDATED BALANCE SHEETS – (CONTINUED)

UNAUDITED


	December 31,			December 31,
(Amounts in thousands, except share and per share amounts)	2021			2020
Equity
WeWork Inc. shareholders’ equity (deficit):
Preferred stock; par value $0.0001; 100,000,000 share authorized, zero issued and outstanding as of December 31, 2021, zero shares authorized, issued and outstanding as of December 31, 2020		—			—
Common stock Class A; par value $0.0001; 1,500,000,000 shares authorized, 705,016,923 shares issued as of December 31, 2021, and 777,979,845 shares authorized, and 34,297,295 shares issued as of December 31, 2020		71			3
Common stock Class B; par value $0.0001; zero shares authorized, issued and outstanding as of December 31, 2021 and 194,080,786 shares authorized and 106,894,492 shares issued and outstanding as of December 31, 2020		—			11
Common stock Class C; par value $0.0001; 25,041,666 shares authorized, 19,938,089 issued and outstanding as of December 31, 2021, and 42,109,087 shares authorized, 20,794,324 shares issued and outstanding as of December 31, 2020		2			2
Common stock Class D; par value $0.001; zero shares authorized, issued and outstanding as of December 31, 2021, and 194,080,786 authorized, zero shares issued and outstanding as of December 31, 2020		—			—
Treasury stock, at cost; 2,944,212 and zero shares held as of December 31, 2021 and 2020, respectively		(29,245	)		—
Additional paid-in capital		12,320,691			2,188,499
Accumulated other comprehensive income (loss)		(31,069	)		(158,810	)
Accumulated deficit		(14,142,517	)		(9,703,490	)

Total WeWork Inc. shareholders’ deficit		(1,882,067	)		(7,673,785	)
Noncontrolling interests		432,628			1,862

Total equity		(1,449,439	)		(7,671,923	)

Total liabilities and equity	$	21,756,171		$	25,356,334

The accompanying notes are an integral part of these consolidated financial statements.

WEWORK INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

UNAUDITED


	Year Ended December 31,
(Amounts in thousands, except share and per share data)	2021			2020			2019
Revenue (including related party revenue of $142,833, $169,783 and $179,651 for the years ended December 31, 2021, 2020 and 2019, respectively. See Note 24)	$	2,570,127		$	3,415,865		$	3,458,592
Expenses:
Location operating expenses—cost of revenue (exclusive of depreciation and amortization of $671,932, $715,413 and $515,309 for the years ended December 31, 2021, 2020 and 2019, respectively, shown separately below)		3,084,646			3,542,918			2,758,318
Pre-opening location expenses		159,096			273,049			571,968
Selling, general and administrative expenses		1,010,582			1,604,669			2,793,663
Restructuring and other related costs		433,811			206,703			329,221
Impairment/(gain on sale) of goodwill, intangibles and other assets		870,002			1,355,921			335,006
Depreciation and amortization		709,473			779,368			589,914

Total expenses (including related party expenses of $84,797, $80,524 and $290,748 for the years ended December 31, 2021, 2020 and 2019, respectively. See Note 24)		6,267,610			7,762,628			7,378,090
Loss from operations		(3,697,483	)		(4,346,763	)		(3,919,498	)
Interest and other income (expense), net:
Income (loss) from equity method and other investments		(18,333	)		(44,788	)		(32,206	)
Interest expense (including related party expenses of $(387,208), $(246,875) and $(11,024) for the years ended December 31, 2021, 2020 and 2019, respectively. See Note 11 and Note 24)		(454,703	)		(331,217	)		(99,587	)
Interest income		18,973			16,910			53,244
Foreign currency gain (loss)		(133,646	)		149,196			29,652
Gain (loss) from change in fair value of warrant liabilities (including from related party financial instruments of $(345,271), $819,647, and $(373,738) for the years ended December 31, 2021, 2020 and 2019, respectively. See Note 13)		(342,939	)		819,647			239,145
Loss on extinguishment of debt		—			(77,336	)		—

Total interest and other income (expense), net		(930,648	)		532,412			190,248

Pre-tax loss		(4,628,131	)		(3,814,351	)		(3,729,250	)
Income tax benefit (provision)		(3,464	)		(19,506	)		(45,637	)

Net loss		(4,631,595	)		(3,833,857	)		(3,774,887	)
Net loss attributable to noncontrolling interests:
Redeemable noncontrolling interests — mezzanine		139,083			675,631			493,047
Noncontrolling interest — equity		53,485			28,868			17,102

Net loss attributable to WeWork Inc.	$	(4,439,027	)	$	(3,129,358	)	$	(3,264,738	)

Net loss per share attributable to Class A and Class B common stockholders (see Note 22):
Basic	$	(18.38	)	$	(22.24	)	$	(23.46	)

Diluted	$	(18.38	)	$	(22.24	)	$	(23.46	)

Weighted-average shares used to compute net loss per share attributable to Class A and Class B common stockholders, basic and diluted		263,584,930			140,680,131			139,160,229

The accompanying notes are an integral part of these consolidated financial statements.

WEWORK INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

UNAUDITED


	Year Ended December 31,
(Amounts in thousands)	2021			2020			2019
Cash Flows from Operating Activities:
Net loss	$	(4,631,595	)	$	(3,833,857	)	$	(3,774,887	)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization		709,473			779,368			589,914
Impairment of property and equipment		—			3,066			63,128
Impairment/(gain on sale) of goodwill, intangibles and other assets		870,002			1,355,921			335,006
Non-cash transaction with principal shareholder		428,289			—			185,000
Loss on extinguishment of debt		—			77,336			—
Stock-based compensation expense		213,669			62,776			358,969
Cash paid to settle employee stock awards		—			(3,141	)		—
Issuance of stock for services rendered, net of forfeitures		(2,271	)		7,893			20,367
Non-cash interest expense		209,907			172,112			14,917
Provision for allowance for doubtful accounts		15,147			67,482			22,221
(Income) loss from equity method and other investments		18,333			44,788			32,206
Distribution of income from equity method and other investments		3,328			4,191			—
Foreign currency (gain) loss		133,646			(149,196	)		(30,915	)
Change in fair value of financial instruments		342,939			(819,647	)		(239,145	)
Contingent consideration fair market value adjustment		—			(122	)		(60,667	)
Changes in operating assets and liabilities:
Operating lease right-of-use assets		1,450,202			1,024,709			(5,850,744	)
Current and long-term lease obligations		(1,606,650	)		502,025			7,672,358
Accounts receivable and accrued revenue		23,485			(32,749	)		(175,262	)
Other assets		(76,452	)		(28,148	)		(126,870	)
Accounts payable and accrued expenses		67,816			(164,190	)		390,609
Deferred revenue		(52,695	)		32,803			90,445
Other liabilities		(30,295	)		39,731			38,840
Deferred income taxes		1,785			(159	)		(3,734	)

Net cash provided by (used in) operating activities		(1,911,937	)		(857,008	)		(448,244	)
Cash Flows from Investing Activities:
Purchases of property and equipment		(296,895	)		(1,441,232	)		(3,488,086	)
Capitalized software		(39,997	)		(22,614	)		(40,735	)
Change in security deposits with landlords		2,526			526			(140,071	)
Proceeds from asset divestitures and sale of investments, net of cash divested		10,832			1,172,860			16,599
Contributions to investments		(26,704	)		(99,146	)		(80,674	)
Loans to employees and related parties		—			—			(5,580	)
Cash used for acquisitions, net of cash acquired		—			—			(1,036,973	)
Deconsolidation of cash of ChinaCo, net of cash received		—			(54,481	)		—
Proceeds from repayment of notes receivable		3,000			—			—

Net cash provided by (used in) investing activities		(347,238	)		(444,087	)		(4,775,520	)

WEWORK INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS – (CONTINUED)

UNAUDITED


	Year Ended December 31,
(Amounts in thousands)	2021			2020			2019
Cash Flows from Financing Activities:
Proceeds from Business Combination and PIPE financing, net of issuance costs paid		1,209,068			—			—
Taxes paid on withholding shares		(32,542	)		—			—
Principal payments for property and equipment acquired under finance leases		(4,626	)		(4,021	)		(3,590	)
Proceeds from unsecured related party debt		1,000,000			1,200,000			—
Proceeds from issuance of convertible related party liabilities		—			—			4,000,000
Proceeds from issuance of debt		708,177			34,309			662,395
Repayments of debt		(712,746	)		(813,140	)		(3,088	)
Bond repurchase		—			—			(32,352	)
Debt and equity issuance costs		(12,091	)		(12,039	)		(71,075	)
Proceeds from exercise of stock options and warrants		17,037			212			38,823
Proceeds from issuance of noncontrolling interests		80,006			100,628			538,934
Distributions to noncontrolling interests		—			(319,860	)		(40,000	)
Payments for contingent consideration and holdback of acquisition proceeds		(2,523	)		(39,701	)		(38,280	)
Proceeds relating to contingent consideration and holdbacks of disposition proceeds		12,177			613			—
Additions to members’ service retainers		449,861			382,184			703,265
Refunds of members’ service retainers		(373,827	)		(575,999	)		(497,761	)

Net cash provided by (used in) financing activities		2,337,971			(46,814	)		5,257,271
Effects of exchange rate changes on cash, cash equivalents and restricted cash		2,050			1,374			3,239

Net increase (decrease) in cash, cash equivalents and restricted cash		80,846			(1,346,535	)		36,746
Cash, cash equivalents and restricted cash—Beginning of period		854,153			2,200,688			2,163,942

Cash, cash equivalents and restricted cash—End of period	$	934,999		$	854,153		$	2,200,688

A reconciliation of net loss, the most comparable GAAP measure, to Adjusted EBITDA is set forth below:


	Year Ended December 31,
(Amounts in thousands)	2021			2020			2019
Net loss	$	(4,631,595	)	$	(3,833,857	)	$	(3,774,887	)
Income tax (benefit) provision^(a)		3,464			19,506			45,637
Interest and other (income) expenses, net^(a)		930,648			(532,412	)		(190,248	)
Depreciation and amortization^(a)		709,473			779,368			589,914
Restructuring and other related costs^(a)		433,811			206,703			329,221
Impairment/(gain on sale) of goodwill, intangibles and other assets^(a)		870,002			1,355,921			335,006
Stock-based compensation expense^(b)		109,740			50,758			346,747
Stock-based payments for services rendered by consultants^(b)		(2,271	)		7,893			20,367
Change in fair value of contingent consideration liabilities^(c)		—			(122	)		(60,667	)
Legal, tax and regulatory reserves and settlements		8,525			1,794			3,678
Legal costs related to regulatory investigations and litigation^(d)		26,599			53,048			—
Expense related to mergers, acquisitions, divestitures and capital raising activities		8,218			7,956			154,641

Adjusted EBITDA	$	(1,533,386	)	$	(1,883,444	)	$	(2,200,591	)

(a)	As presented on our consolidated statements of operations.

(b)	Represents the non-cash expense of our equity compensation arrangements for employees, directors, and consultants.

(c)	Represents the change in fair value of the contingent consideration associated with acquisitions as included in selling, general and administrative expenses on the condensed consolidated statements of operations.

(d)

Legal costs incurred by the Company in connection with regulatory investigations and litigation regarding the Company’s 2019 withdrawn initial public offering and the related execution of the SoftBank Transactions, net of any insurance or other recoveries. See section entitled “Legal Matters” in Note 23 of the notes to the condensed consolidated financial statements included elsewhere in this Quarterly Report for details regarding the related regulatory investigations and litigation matters.

A reconciliation of location gross profit/(loss), the most comparable GAAP measure, to Building Margin is set forth below:


	Year Ended December 31,
(Amounts in thousands)	2021			2020			2019
Location Gross Profit / (Loss) including Depreciation & Amortization	$	(1,288,795	)	$	(1,125,053	)	$	(214,934	)
Depreciation and amortization		671,932			715,413			515,309

Location Gross Profit / (Loss) excluding Depreciation & Amortization		(616,863	)		(409,640	)		300,375
Unconsolidated management fee revenue		(9,468	)		(4,730	)		(5,473	)
Stock-based compensation expense		14,950			8,975			46,135
Indirect location operation expenses		99,341			132,165			176,116

Building Margin	$	(512,040	)	$	(273,230	)	$	517,153


	Three Months Ended												Year Ended
(Amounts in thousands)	December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021			December 31, 2021
Revenue:
Consolidated Locations membership and service revenue	$	694,119		$	625,043		$	563,787		$	575,366		$	2,458,315
Unconsolidated Locations management fee revenue		2,176			2,017			1,377			3,898			9,468
Other revenue		21,470			33,971			28,314			18,589			102,344

Total revenue		717,765			661,031			593,478			597,853			2,570,127

Expenses:
Location operating expenses—cost of revenue ⁽¹⁾		733,341			752,493			780,489			818,323			3,084,646
Pre-opening location expenses		41,890			40,367			43,435			33,404			159,096
Selling, general and administrative expenses ⁽¹⁾		277,152			233,928			225,082			274,420			1,010,582
Restructuring and other related costs		(48,168	)		15,934			(27,794	)		493,839			433,811
Impairment/(gain on sale) of goodwill, intangibles and other assets		240,876			87,541			242,104			299,481			870,002
Depreciation and amortization		174,316			170,816			180,157			184,184			709,473

Total expenses		1,419,407			1,301,079			1,443,473			2,103,651			6,267,610

Loss from operations		(701,642	)		(640,048	)		(849,995	)		(1,505,798	)		(3,697,483	)
Interest and other income (expense), net		(102,553	)		(206,465	)		(68,499	)		(553,131	)		(930,648	)

Pre-tax loss		(804,195	)		(846,513	)		(918,494	)		(2,058,929	)		(4,628,131	)
Income taxes benefit (provision)		1,567			2,251			(4,015	)		(3,267	)		(3,464	)

Net loss		(802,628	)		(844,262	)		(922,509	)		(2,062,196	)		(4,631,595	)
Net loss attributable to noncontrolling interests		87,201			41,862			33,664			29,841			192,568

Net loss attributable to WeWork Inc.	$	(715,427	)	$	(802,400	)	$	(888,845	)	$	(2,032,355	)	$	(4,439,027	)

(1)	Exclusive of depreciation and amortization shown separately on the depreciation and amortization line.

A reconciliation of net loss, the most comparable GAAP measure, to Adjusted EBITDA is set forth below:


	Three Months Ended												Year Ended
(Amounts in thousands)	December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021			December 31, 2021
Net loss	$	(802,628	)	$	(844,262	)	$	(922,509	)	$	(2,062,196	)	$	(4,631,595	)
Income tax (benefit) provision		(1,567	)		(2,251	)		4,015			3,267			3,464
Interest and other (income) expense		102,553			206,465			68,499			553,131			930,648
Depreciation and amortization		174,316			170,816			180,157			184,184			709,473
Restructuring and other related costs		(48,168	)		15,934			(27,794	)		493,839			433,811
Impairment/(gain on sale) of goodwill, intangibles and other assets		240,876			87,541			242,104			299,481			870,002
Stock-based compensation expense		47,808			4,040			4,294			53,598			109,740
Stock-based payments for services rendered by consultants		1			1			1			(2,274	)		(2,271	)
Change in fair value of contingent consideration liabilities		—			—			—			—			—
Legal, tax and regulatory reserves and settlements		771			258			79			7,417			8,525
Legal costs related to regulatory investigations and litigation		1,545			2,735			(1,077	)		23,396			26,599
Expense related to mergers, acquisitions, divestitures and capital raising activities		1,685			2,724			3,303			506			8,218

Adjusted EBITDA	$	(282,808	)	$	(355,999	)	$	(448,928	)	$	(445,651	)	$	(1,533,386	)

A reconciliation of location gross profit/(loss), the most comparable GAAP measure, to Building Margin is set forth below:


				Three Months Ended									Year Ended
	December 31,			September 30,			June 30,			March 31,			December 31,
(Amounts in thousands)	2021			2021			2021			2021			2021
Location Gross Profit / (Loss) including Depreciation & Amortization	$	(200,934	)	$	(287,851	)	$	(385,644	)	$	(414,366	)	$	(1,288,795	)
Depreciation and amortization		163,888			162,418			170,319			175,307			671,932

Location Gross Profit / (Loss) excluding Depreciation & Amortization		(37,046	)		(125,433	)		(215,325	)		(239,059	)		(616,863	)
Unconsolidated management fee revenue		(2,176	)		(2,017	)		(1,377	)		(3,898	)		(9,468	)
Stock-based compensation expense		4,776			609			734			8,831			14,950
Indirect location operation expenses		25,771			24,205			24,136			25,229			99,341

Building Margin	$	(8,675	)	$	(102,636	)	$	(191,832	)	$	(208,897	)	$	(512,040	)

A reconciliation of net cash provided by (used in) operating activities, the most comparable GAAP measure, to Free Cash Flow is set forth below:


	Year Ended December 31,
(Amounts in thousands)	2021			2020			2019
Net cash provided by (used in) operating activities ^(a)	$	(1,911,937	)	$	(857,008	)	$	(448,244	)
Less: Purchases of property and equipment ^(a)		(296,895	)		(1,441,232	)		(3,488,086	)

Free Cash Flow	$	(2,208,832	)	$	(2,298,240	)	$	(3,936,330	)

(a)	As presented on our consolidated statements of cash flows.

Key Performance Supplemental Information


	December 31,			September 30,			June 30,			March 31,			December 31,
(Amounts in ones, except percentages)	2021			2021			2021			2021			2020
Other key performance indicators:
Consolidated Locations ^(1),(2),(3)
Membership and service revenues	$	694,119		$	625,043		$	563,787		$	575,366		$	609,191
Workstation Capacity		746,000			766,000			770,000			804,000			865,000
Physical Memberships		469,000			432,000			386,000			378,000			387,000
All Access and Other Legacy Memberships		45,000			32,000			20,000			15,000			13,000
Memberships		514,000			464,000			406,000			393,000			401,000
Physical Occupancy Rate		63	%		56	%		50	%		47	%		45	%
Enterprise Physical Membership Percentage		47	%		49	%		52	%		52	%		52	%
Unconsolidated Locations ^(1),(2),(3)
Membership and service revenues⁽⁴⁾	$	132,886		$	119,363		$	101,380		$	89,815		$	86,144
Workstation Capacity		166,000			165,000			168,000			160,000			166,000
Physical Memberships		121,000			114,000			110,000			97,000			89,000
Memberships		121,000			114,000			111,000			97,000			89,000
Physical Occupancy Rate		73	%		69	%		66	%		61	%		54	%
Systemwide Locations
Membership and service revenues ⁽⁵⁾	$	827,005		$	744,406		$	665,167		$	665,181		$	695,335
Workstation Capacity		912,000			932,000			937,000			963,000			1,030,000
Physical Memberships		590,000			546,000			496,000			475,000			476,000
All Access and Other Legacy Memberships		46,000			32,000			20,000			15,000			13,000
Memberships		635,000			578,000			517,000			490,000			490,000
Physical Occupancy Rate		65	%		59	%		53	%		49	%		46	%

(1)

For certain key performance indicators the amounts we present are based on whether the indicator relates to a location for which the revenues and expenses of the location are consolidated within our results of operations (“Consolidated Locations”) or whether the indicator relates to a location for which the revenues and expenses are not consolidated within our results of operations, but for which we are entitled to a management fee for our advisory services (“Unconsolidated Locations”). As of December 31, 2021, IndiaCo, ChinaCo and Israel locations are our only Unconsolidated Locations

(2)

Effective October 2, 2020, the Company deconsolidated ChinaCo and as a result, beginning with the fourth quarter of 2020, the workstation capacity, memberships, occupancy and enterprise memberships percentages for Consolidated Locations excludes the impact of ChinaCo locations, and they are included in Unconsolidated Locations, with no impact on Total Locations. Prior to October 2, 2020, ChinaCo was still consolidated and therefore the key performance indicators for ChinaCo are included in Consolidated Locations.

(3)	On June 1, 2021, we closed a franchise agreement with Ampa and transferred the building operations and obligations of our Israel locations to Ampa. Beginning on June 1, 2021, our Israel locations are no longer Consolidated Locations and are classified as Unconsolidated Locations.

(4)	Unconsolidated membership and service revenues represents the results of Unconsolidated Locations that typically generate ongoing management fees for the Company at a rate of 2.75-4.00%.

(5)	Systemwide Location membership and service revenues represents the results of all locations regardless of ownership, including Consolidated and Unconsolidated Locations.