WeightWatchers, a 60-year-old iconic company that transformed America’s approach to weight loss, is struggling to stay afloat due to its significant debt of $1.6 billion. The company has begun discussions with its lenders about restructuring, aiming to restructure its debt and avoid bankruptcy.
The traditional weight-loss industry giant has faced a major setback as the rise of weight-loss drugs like Ozempic and Wegovy has disrupted its business model. With many former customers now turning to new-generation weight-loss drugs that help them shed pounds with less effort, WeightWatchers’ revenue has been in decline.
Founded in 1963, WeightWatchers was once a household name, selling diet meals, magazines, books, and memberships to millions of people worldwide. Celebrities like Oprah Winfrey and Jessica Simpson have helped market the brand over the years. However, with declining sales and increasing competition from pharmaceutical companies like Novo Nordisk, the company is now facing significant financial challenges.
Talks between WeightWatchers and its lenders are in the early stages, aiming to secure a better financial position for the struggling company. While there’s no suggestion that bankruptcy is imminent, WeightWatchers’ financial flexibility has been limited due to its debt obligations, including $175 million loan due next year and over $1.4 billion of loans and bonds due in 2028 and 2029.
The rise of weight-loss drugs like Ozempic has already had a devastating impact on another legacy diet brand, Jenny Craig, which announced its shutdown earlier this year. As WeightWatchers continues to navigate the challenging weight-loss industry landscape, it remains to be seen whether the company will be able to adapt and emerge stronger in the long run.
Source: https://www.dailymail.co.uk/yourmoney/consumer/article-14398443/weightwatchers-debt-struggles-restructuring.html