WeightWatchers Plans Bankruptcy Amid Fierce Competition from Weight-Loss Drugs

NEW YORK, NY — WeightWatchers, the well-known weight management company, is poised to file for bankruptcy in the upcoming months as part of a strategic move to shift control of the business to its creditors, according to a report by the Wall Street Journal on Wednesday.

With approximately $1.6 billion in debt, WeightWatchers has struggled to maintain its relevance in a market increasingly dominated by effective weight-loss drugs, such as Novo Nordisk‘s Ozempic and Wegovy. These medications have surged in popularity, offering a quicker route to weight loss, which has prompted former customers to turn away from traditional weight-loss programs.

Shares of WeightWatchers plummeted nearly 59% to just 18 cents during afternoon trading, a dramatic decline from its peak of $100 in 2018. Following the announcement of potential bankruptcy, the company’s market value shrank to a mere $33.3 million, far below the heights of its $6.7 billion valuation.

According to insiders, ongoing negotiations with lenders and bondholders are underway, though they are described as unrelated to recent market fluctuations or tariffs imposed during the Trump administration. “A number of options are being considered, negotiations are ongoing with lenders and bondholders,” a source remarked.

The financial distress follows a troubling trend for WW, as the firm has reported consecutive revenue declines over recent quarters. In a bid to adapt, the company acquired Subscription-based telehealth platform Sequence in 2023 to advance into the obesity medication space.

Notably, celebrity endorsements have played a pivotal role in WeightWatchers’ marketing strategy, with figures like Oprah Winfrey and Jessica Simpson previously serving as prominent spokespeople. However, in a telling sign of the company’s struggles, Winfrey exited the board last year amidst personal admissions regarding her own use of weight-loss medication.

Last month, WW capitalized on the remaining $121 million from a larger $175 million loan, a decision made to enhance financial flexibility rather than address immediate obligations. Beyond this loan, the company faces additional debts totaling over $1.4 billion maturing in 2028 and 2029.

Despite the challenges, WeightWatchers has attempted to innovate by launching its own weight-loss injection last year. However, this move has yet to deliver the momentum the company desperately needs, leading to CEO Sima Sistani’s resignation after just two years in charge. Board member Tara Comonte has taken over temporarily and expressed confidence in the team’s ability to shift strategies for renewed growth.

WeightWatchers, founded in 1963, has been a staple in the weight-loss industry, but as the landscape evolves with pharmaceutical alternatives, the company’s future remains uncertain. “I am confident that we have the right team in place and are focused on the right strategies to drive growth,” Comonte stated.