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A WeightWatchers lawyer told a US Bankruptcy judge on Thursday, as diet drugs and tiktok’s one-two punches have undermined one of the most reliable brands with fat loss.
WW International, Inc. WeightWatchers, officially known as, filed for Chapter 11 bankruptcy protection in federal court in Delaware on Tuesday night, with the company slashing pre-packaged transactions to manually manage businesses to lenders and bondholders already covered.
In 2018, WeightWatchers, which relied on hosting workshops for people who share their experiences fighting fat, won $1.5 billion with annual revenue and market capitalization of over $7 billion. Oprah Winfrey owns a tenth of the company and joins the board of directors.
However, the coronavirus pandemic has hampered WeightWatchers’ workshop model, with annual revenue falling to under $800 million by 2024. Winfrey left the company’s board of directors last year. The lawyer said that “evolving consumer preferences and rapid rise in GLP-1” meant that it was unable to supply a debt load of $1.6 billion and was seeking a total valuation of $700 million.
“Consumers are increasingly prioritizing overall health and rejecting traditional weight loss stories,” WeightWatchers wrote in court filed this week.
“The rise of free, low-cost, do-it-yourself (‘DIY’) weight loss apps reflects the growing demand for self-directed and flexible solutions. DIY trends are further driven by influencers who share personal success stories and guidance via social media such as Instagram, Tiktok, YouTube and more. ”
In 2023, WeightWatchers purchased the launch sequence for Telehealth for $106 million. The sequence then became the company’s clinical product that could prescribe GLP-1 like Ozempic and Wegovy. Still, even if the company fell 12% to 3.3 million subscribers in 2024, it remains largely married to the workshop model, and its new prescription business couldn’t make up for the difference.
In comparison, he and she, a telehealth company that was released in 2021 and offers weight loss drug prescriptions, have seen their market capitalization surge to over $11 billion.
Weightwatcher is expected to close bankruptcy next month. The attorney said that if certain milestones were hit during the bankruptcy process, current shareholders would be worth less than a tenth of the company’s restructured shares, potentially worth $20 or $30 million.
Last year, the company’s then-Chief Executive Officer, Sima Sistani, told FT that WeightWatchers was trying to become a “weight health” company with no decision to adopt a “complete solution.” She left work five months later.
