WeightWatchers Files for Bankruptcy to Reduce $1 Billion in Debt

[ad_1] WeightWatchers, a 62-year-old well being and wellness firm that has confronted stiff competitors from new weight-loss medication and packages, filed for chapter on Tuesday in an effort to scale back its debt by greater than $1 billion whereas it expands its telehealth enterprise.

In its heyday, WeightWatchers formed how tens of millions of individuals in america and past ate and exercised. Oprah Winfrey was as soon as a spokeswoman and board member.

However the firm has struggled to maintain its clients as folks flip to weight-loss drugs, health apps and social media influencers.

Underneath a chapter plan filed in Delaware, WeightWatchers shall be taken over by a gaggle of buyers, the submitting mentioned. Current shareholders will retain a 9 % stake as soon as the method is accomplished in about 45 days, and the corporate will proceed working.

The adjustments “will give us the flexibleness to speed up innovation, reinvest in our members, and lead with authority in a quickly evolving weight administration panorama,” Tara Comonte, the chief government of WeightWatchers, mentioned in a press release.

WeightWatchers was based in New York Metropolis by Jean Nidetch, an entrepreneur who had shed 72 kilos by adhering to a strict food plan with the assist of her buddies. She charged dieters a charge to attend periodic conferences, the place they have been inspired to maintain monitor of what they ate and to encourage each other.

The corporate advanced by including an train routine and some extent system that quantified acceptable meals parts. Now it affords weight-loss packages and health teaching on its cell app and web site.

In 2022, the corporate paid a $1.5 million penalty as a part of a settlement after the Federal Commerce Fee mentioned that its weight-loss app for kids had illegally collected private data from minors. Pediatricians criticized the app, warning that weight-loss packages for kids may result in consuming issues.

The corporate has additionally confronted headwinds lately from rising demand for Ozempic, Wegovy, Zepbound and different medication that assist folks drop some pounds partly by suppressing urge for food.

WeightWatchers rebranded as WW Worldwide in 2018 as a part of an effort to broaden its focus past weight reduction. In 2023, it acquired Sequence, a subscription-based telehealth platform, and started providing weight-loss drugs.

The corporate’s newest earnings report on Tuesday confirmed that its income from its scientific enterprise, together with prescribed drugs, had grown 57 % year-on-year. However its first-quarter income had declined by 10 %.

The coronavirus pandemic resulted in a big drop in individuals who attended in-person WeightWatchers conferences, prompting the corporate to scale back the variety of conferences it provided.

WeightWatchers has additionally misplaced one in all its most distinguished spokeswomen, Ms. Winfrey.

She joined its board in 2015, and credited WeightWatchers with serving to her lose 40 kilos. However final 12 months, months after she introduced that she was taking a weight-loss treatment, the corporate mentioned that she was leaving.