Office space platform WeWork is anticipating that it will post its first $1 billion revenue quarter this year and is aiming to become free cash flow (FCF) positive by 2022, Reuters reported on Tuesday (Feb. 11).
The financial goals are part of WeWork Chairman and SoftBank Chief Operations Officer Marcelo Claure’s five-year plan. By 2024, the company hopes to have over $1 billion of FCF.
By the end of this year, WeWork expects to be in 739 locations across 140 cities. By 2021, it anticipates hitting 1,000 locations, and by 2023, 1 million.
Under Claure’s restructuring, three of WeWork’s board members — Mark Schwartz, Steve Langman and Lew Frankfurt — are exiting. In addition, Kirthiga Reddy joined the board, replacing Ron Fisher.
The company said it will continue to appoint new directors “who add strategic value and diverse perspectives” in the coming months.
WeWork said it has a $1.75 billion letter of credit with Goldman Sachs and with the successful execution of its five-year strategic and financial plan, it would have access to $2.5-$3.0 billion of additional liquidity for future growth.
Under the new credit facility, WeWork is not required to post any cash collateral and will have access to $800 million in working capital.
The credit line is part of SoftBank’s $9.5 billion October bailout that followed WeWork’s unsuccessful attempt to go public.
Claure told CNBC that ousted CEO Adam Neumann didn’t leave with $1.7 billion as was frequently reported in October.
“To say that he has walked away with over a billion dollars is totally false,” Claure told the news outlet.
Claure said he doesn’t interact with Neumann, but the founder is “a large shareholder of the company.”
And “... as we do a tender to buys shares from other shareholders, he’s going to have the same opportunity as any other shareholder,” Claure said.
After WeWork revealed in its prospectus that it had $900 million loss, SoftBank agreed to a bailout of $5 billion in new financing and up to $3 billion in a tender offer for existing shareholders.
Earlier this month Sandeep Manthrani was named WeWork’s new chief executive officer. He is set to start on Feb. 18.