WeightWatchers Reportedly Considers Bankruptcy Amid Business Struggles, Debt Woes: Retail Traders On Edge

WW International Inc (WW) shares plunged 62.2% to an all-time low on Wednesday, after a report in the Wall Street Journal said the health and wellness company is preparing to file for bankruptcy in the coming months.

The company is negotiating with a key group of lenders and bondholders. Although it would prefer to restructure its balance sheet out of court, a Chapter 11 process is more realistic because the company is publicly traded, the Journal quoted anonymous sources as saying.

Popularly known as WeightWatchers, the company helps users lose weight and build healthy habits through a subscription-based program that offers meal plans, tracking tools, coaching, and community support.

In recent years, the business has struggled partly due to the rise of weight-loss drugs like Ozempic. The company's revenue has fallen 11% to 14% in each of the last three years.

It also has taken on significant debt, and repayment is due in the coming years.

In February, credit ratings firm S&P Global Ratings downgraded WW International, saying that its subscriber base has aged, and its brand is out of favor.

On Stocktwits, retail sentiment was 'neutral', while message volume jumped over 50% from the previous day.

User comments on the platform were mixed.

Some users saw it as a buying opportunity, expecting a surge if the company secured new financing or restructured its debt. 

Others were skeptical, noting the business has been struggling for a while.

WW shares closed at $0.175, down 86.2% year to date.

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