WeightWatchers has filed for Chapter 11 bankruptcy protection, aiming to eliminate $1.15 billion in debt in order to shift its focus towards becoming a telehealth services provider amidst financial struggles.
The big picture: The parent company, WW International Inc., has secured the backing of almost 75% of its debt holders and anticipates emerging from bankruptcy within 45 days or sooner.
Driving the news: Established over 60 years ago, WeightWatchers ventured into the prescription drug weight loss sector in 2023 through its acquisition of Sequence, now known as WeightWatchers Clinic, which provides telehealth services for obtaining prescriptions for medications like Ozempic, Wegovy, and Trulicity.
- Despite a 10% decline in first-quarter revenue and an adjusted loss of 47 cents per share, the company experienced a 57% surge in clinical subscription revenue (weight-loss medications) to $29.5 million.
- Earlier in September, WW International’s CEO Sima Sistani resigned, and Tara Comonte, a WeightWatchers board member and former Shake Shack executive, was appointed as the interim chief executive.
- With Comonte now serving as CEO, the company emphasizes its commitment to offering trusted, science-backed, and holistic solutions focused on long-term health, community support, and sustainable results.
Go deeper: WeightWatchers’ stock has been trading below $1 since early February, with a further decline to 39 cents in after-hours trading following the news of the bankruptcy filing made in the U.S. Bankruptcy Court for the District of Delaware.
