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WeWork has a Q1 loss and says that investors should see losses as investments



Adam Neumann, co-founder and CEO of WeWork.

Michael Nagle Bloomberg | Getty Images

As a new public company representing the sharing economy, Uber stumbled and lifted out of the gate. WeWork is trying to prepare another story for Wall Street.

In an interview with CNBC to discuss the company's quarterly financing, CFO urged Artie Minson investors to see losses as "investments".

"We really want to emphasize the difference between losing money and investing money," says Minson Wednesday. "You can lose money or you can invest money. At the end of the quarter, we have these cash-generating assets. "

WeWork, recently re-branded as We Company, said in its first quarter business update that it lost $ 264 million over the period, reducing the deficit from the same period a year ago, when It lost $ 274 million, while revenue increased more than $ 728.3 million (including $ 39 million from a program called the Creator Awards), as the company expanded into new international markets and strengthened its membership for its sites.

Wall Street can Need some convincing in front of their IPO, which WeWork left confidential in December. Public market investors have penalized Uber and Lyft for their billions in losses and uncertain path to profitability Uber sold shares in the low end of the expected range last week and the stock traded still far below the debut price.

When he was asked if he was trying to differentiate WeWork's losses from the capital, using the riding companies subsidies and discounts, said Minson, "it is a fair differentiator." Hiring out space is "a proven business model," he said. Membership climbed to 466,000 from 220,000 a year earlier.

The ViWorks model, however, continues to rely on large funds from private investors, namely SoftBank, which has poured more than $ 1

0 billion into the company, including $ 2 billion this year at $ 47 billion. WeWork has to put money into real estate on some of the most expensive markets and it gives money back over time because companies and individuals pay their rent or membership.

But the public markets like to see profits when asked to pay such a high price. When Uber became public, it only became the fourth US company with a market share of at least $ 50 billion that lost money in the previous year. The other three were CVS, General Electric and Qualcomm (the chip maker had only one loss because it took a one-time fee linked to a change in tax code).

Last year, WeWork lost $ 1.9 billion, surpassing Uber's losses, on $ 1.8 billion revenue. Cash and cash commitments amounted to $ 5.9 billion as of March 31, from $ 6.6 billion at the end of December.

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