WeightWatchers is in dire trouble as it buckles under the weight of $1.6 billion in debt.
The company – whose name became a byword for the traditional weight-loss industry – has begun discussions with its lenders about restructuring, the Wall Street Journal reported.
The rise of weight-loss drugs like Ozempic and Wegovy have upended its business model, which was based around selling low-calorie foods and diet advice to overweight people.
But now, many of its former customers are turning to a new generation of weight-loss drugs that help them shed pounds with far less effort. As a result, revenue for WW – as it is now known – has been on the slide in recent quarters.
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 Friday, WW’s market value stood at just $64.7 million — a shadow of its $6.7 billion peak. By comparison, Ozempic-maker Novo Nordisk is valued at $2.6 trillion.
Singer and actress Jessica Simpson appeared in a commercial for Weight Watchers in 2014
WeightWatchers became a byword for the traditional weight-loss industry – but it is now struggling as Americans turn to weight-loss drugs like Ozempic
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
Talks between WW and its lenders are in the early stages, the WSJ reported. There is no suggestion that the company is considering bankruptcy.
But WW is running low on money. Last month, it 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 when approached by DailyMail.com.
The negotiations are taking place under a confidentiality agreement and are reportedly to help the lender’s advisors get a better sense of WeightWatcher’s financial position.
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.
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.
In the 1980s, Weight Watchers sold American women the dream of getting a beach body
Ozempic mimics the body’s GLP-1 hormone decreasing user’s appetites
Oprah Winfrey admitted to using weight-loss drugs to manage her own weight
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
Jenny Craig (left) and her husband Sidney Craig founded the weight loss company Jenny Craig, which went bust in the US in 2023
Winfrey joined the board of WW International in 2015 after an investment of $43 million
WW’s share price has slumped in recent years
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.
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.
During Sistani’s tenure, WeightWatchers acquired the telehealth platform Sequence, now known as WeightWatchers Clinic, expanding into obesity drug prescriptions.
Board member Tara Comonte, who will lead the group on a temporary basis until a new boss is found, said: ‘I am confident that we have the right team in place and are focused on the right strategies to drive growth.’
Winfrey joined the board in 2015 after investing $43 million in the company. She also agreed to be included in Weight Watchers commercials and advertisements.
Within three years of her involvement, WW International shares were trading for more than $100 – reaching an all-time high of $103 in June of that year.
WW International, as it is now known, had a peak market cap of $6.7 billion in June 2018.
It has been valued above $2 billion for all but about five of the past 20 years – until declining sharply, and never recovering, after Ozempic was approved for weight loss in 2021.
