NEW YORK – Weight Watchers said Tuesday it is filing for Chapter 11 bankruptcy protection to eliminate its $1.15 billion in debt and focus on moving to a telehealth service provider.
Parent WW International Inc. said it has received support from nearly three-quarters of its debtors. It is expected to come out of bankruptcy within 45 days.
Founded over 60 years ago, WeightWatchers has been struggling recently. In 2023, the company moved to the prescription drug weight loss business. In particular, with the $106 million sequence acquisition, it is now a telehealth service that helps users get prescriptions for drugs such as Ozempic, Wegovy, and Trulicity.
The latest revenue report on Tuesday showed a 10% decline in first quarter revenue, with losses of 47 cents per share on an adjusted basis. However, clinical subscription revenue (or weight loss drugs) rose 57% year-on-year to $29.5 million.
In September, WW International CEO Sima Sistani resigned, and the New York Company named Tara Comonte, a director of WeightWatchers and former Shake Shack Executive, Tara Comonte.
“As the weight conversation changes towards long-term health, our commitment to providing the most trusted, science-supported and holistic solution based on community support and lasting outcomes has been stronger or more important than ever,” current CEO Commonte said in a statement Tuesday.
The company’s shares have been trading for less than a dollar since early February. In trading outside of business hours, stocks plummeted from half to 39 cents.
The bankruptcy filing was filed in the US Bankruptcy Court in the Delaware area.
