The next shoe is dropping for beleaguered office space-sharing company WeWork, which has announced that it will be cutting 2,400 employees globally, or about 25% of its total workforce, in order to cut costs.
WeWork lost $1.25 billion in the third quarter on revenue of $934 million. The company was reportedly desperately in need of a cash infusion after its proposed initial public offering fell apart.
"We are grateful for the important roles they have played in building WeWork over the last decade," the company said in a statement to Bloomberg. "WeWork is seeking to stabilize its business and show a path to profitability after scrapping an initial public offering, and its value plummeted from $47 billion to about $8 billion."
The laid-off workers will receive severance, continued benefits and other forms of assistance, according to a statement the company sent to Bloomberg.
Japan's Softbank Group (SFTBY) bailed the company out with a $3 billion investment last month, but that was not enough to save the company from having to cut costs and jobs. That bailout included a buyout of ousted founder and former CEO Adam Neumann, who reportedly received a $1.7 billion golden parachute from Softbank on his way out.
The Wall Street Journal reported that the company reported a $197 million charge related to asset impairments as it wrote down the costs of businesses it has acquired. Meanwhile costs related to the IPO and other deals and restructuring totaled $83 million.
Meanwhile, the Journal also reported that the company was looking to lure departing T-Mobile U.S. TMUS CEO John Legere to run the company going forward, but that has not been confirmed. Earlier this week, Legere announced that he will step down from the company on May 1, with COO Mike Sievert taking over for him as the company's top executive.