RECENT POSTS
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A Look at Product Warranty Accruals

Thursday, November 7, 2019
CHS Limps Through Weather & War

Wednesday, November 6, 2019
Master Class: Preparing for Recession

Sunday, October 27, 2019
When Operating Leases Weigh Down ROA

Wednesday, October 23, 2019
Feeling the Squeeze on China

Tuesday, October 22, 2019
Netflix and the Cost of Content

Wednesday, October 9, 2019
U.S. firms with Sales in China through 2018.

Wednesday, October 9, 2019
Tracking  Pension Data in Calcbench

Friday, October 4, 2019
In Depth: Leasing Costs in Retail Sector

Thursday, September 19, 2019
Alibaba and Cloud Computing

Monday, September 16, 2019
Introducing Critical Audit Matters

Wednesday, September 11, 2019
Our Fireside Chat on Goodwill Assets

Friday, September 6, 2019
Pulling Forward Share Buybacks

Saturday, August 31, 2019
A Quick Catch-Up on VMWare

Friday, August 23, 2019
By the Numbers: Restructuring Costs Over Time

Wednesday, August 21, 2019
WeWork Liabilities, Part II

Tuesday, August 20, 2019
WeWork’s Liabilities in Perspective

Wednesday, August 14, 2019
Comparing LinkedIn, Twitter Revenue

Wednesday, August 7, 2019
Leasing’s Effect on Retail Balance Sheets

Thursday, August 1, 2019
Using Calcbench to Find China Exposure

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WeWork Liabilities, Part II
Wednesday, August 21, 2019

Our previous post looked at WeWork’s operating lease liabilities in sheer dollar terms — and without quesiton, in sheer dollar terms those liabilities are enormous. WeWork has the largest operating lease liabilities of any filer out there, by far.

Then we tried to put those leasing liabilities into a more relative perspective. And if you look at them in the right light, WeWork isn’t the only company betting so much of its operations on operating leases.

What did we do? Simple.

Start with the present value of a company’s operating lease liabilities, which all firms are now required to report on the balance sheet. Divide that number into total liabilities, expressed as a percentage. That lets you see what portion of all liabilities stem from operating leases.

We did that for all firms with more than $1 billion in total liabilities, and then sorted them for the five with the highest percentages. The results are below, with WeWork appended at the bottom.



So WeWork isn’t the firm with its balance sheet most entangled in operating leases. Yes, in dollars WeWork dwarfs everyone else, but in relative terms we have at least a few firms even more wrapped up in operating lease liabilities than WeWork is.

We’ve written about Chipotle ($CMG) in previous posts, and Five Star Senior Living also features in our recent in-depth report about operating lease liabilities, too. Of course, one big difference among these five firms above and WeWork is that these firms actually make a profit from operations — something that has eluded WeWork so far, and when the company might need black ink to print its bottom line is anyone’s guess.


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