WeightWatchers to file for bankruptcy within weeks as it battles $1.6b in debts
WeightWatchers will file for bankruptcy in the coming weeks after finally negotiating a deal on its $1.6 billion of debt.
The health and wellness company has struggled with declining revenue in the face of competition from weight loss drugs such as Ozempic.
Now the company will use a pre-packaged filing meaning it will enter Chapter 11 bankruptcy with a debt-restructuring deal already agreed with its lenders, Bloomberg reported.
This should allow the company to move out of bankruptcy quickly and keep its business running as normal in the process.
WeightWatchers, or WW as it is now know, also plans to remain a publicly-trade company, according to reports.
The dominance of weight-loss drugs such as Ozempic and Wegovy have upended WeightWatchers business model, which was based around selling low-calorie foods and diet advice to overweight people.
Many of its former customers are turning to a new generation of weight-loss drugs that help them shed pounds with far less effort.
Founded in 1963, WeightWatchers has influenced millions of people in the U.S. and around the world, selling diet meals, magazines, books, and memberships to its weight-loss programs.
Over the years, celebrities like Oprah Winfrey and Jessica Simpson have helped market the brand. In 2014, Simpson appeared in ads at age 33, showing off her post-baby weight loss in a form-fitting black dress.
Alarm bells first rang in March 2023, when shares hit an all-time low amid declining sales. The situation worsened when longtime investor Winfrey — who admitted to using weight-loss medication — stepped down from the board.
Since then, the stock has continued its downward spiral. On Thursday, WW's market value stood at just $11.6 million — a shadow of its $6.7 billion peak.
By comparison, Ozempic-maker Novo Nordisk is valued at $2.6 trillion.
Last month, WW took the remaining $121 million from a $175 million loan due in April 2026. Bosses said it was for financial flexibility rather than immediate bills.
As well as the $175 million debt due next year, the company also has more than $1.4 billion of loans and bonds due in 2028 and 2029.
WW and its lenders both declined to comment on the record when approached by DailyMail.com.
Pharmaceutical companies like Novo Nordisk and Eli Lilly took the world by storm last year with a new generation of so-called GLP-1 diet products - Ozempic, Wegovy and Zepbound.
WeightWatchers stock has dropped to a fraction of its value at the company's peak
WeightWatchers, founded in 1963, is perhaps one of the best-known names in weight-loss and diet programs around the world. Pictured is an issue of its eponymous magazine
Ozempic mimics the body's GLP-1 hormone decreasing user's appetites
Jean Nidetch, founder of Weight Watchers, with devotees of the movement in 1984
WeightWatchers chief executive Sima Sistani stepped down after two years at the helm
The drugs were widely effective and soon became popular among Americans and others around the world wanting to lose weight.
Ozempic has already been blamed for the demise of another legacy diet brand.
Jenny Craig, a household name since its launch in the 1980s, announced in May 2023 it was shutting down after drowning in debt.
Last year, WW announced its own weight-loss injection in an attempt to compete with the likes of Ozempic.
It was considered a surprising move for a company that has built its global success on the premise that healthy controlled eating and iron willpower are the key to achieving sustainable weight loss.
However, the move has not resulted in the hoped for turnaround - with WW chief executive Sima Sistani stepping down after two years at the helm.
During Sistani's tenure, WeightWatchers acquired the telehealth platform Sequence, now known as WeightWatchers Clinic, expanding into obesity drug prescriptions.
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