Welcome everyone to the WeWork fourth quarter 2022 earnings conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question at this time, press the Star followed by the One on your telephone keypad. To withdraw your question, press star One again. I would now like to turn the conference over to Kevin Berry, Senior Vice President of Investor Relations. Please go ahead. Thank you, Angela. Good morning and welcome to WeWork's fourth quarter and full year 2022 earnings conference call. During this call, we will refer to our earnings release and investor presentation, which have been furnished with the SEC and can be accessed at investors.wework.com. This discussion will include forward-looking statements that are subject to risks and uncertainties that may cause actual results to differ materially. Additional information concerning factors that could cause actual results to differ materially is contained in our latest annual and subsequent quarterly and periodic reports filed with the SEC. We will also discuss certain non-GAAP financial measures, which we believe are meaningful in evaluating the company's performance. Additional disclosures regarding these non-GAAP measures, including a GAAP to non-GAAP reconciliation, are included in our earnings press release and supplemental presentation and will also be included in our Form 10-K once filed. I'd like to introduce Sandeep Mathrani, Chairman and Chief Executive Officer, and Andre Fernandez, Chief Financial Officer. With that, let me turn it over to Sandy. Thank you, Kevin. Thank you all for joining our call this morning. I'm incredibly pleased that in 2022 we accomplished what we set out to do. In December, WeWork, for the first time in its history, posted positive Adjusted EBITDA. Our team was set up for the challenge to accomplish that by year end, they delivered. Thank you all. As we communicated our plans to do so on our last earnings call, we extended maturity dates to 2025, sorry, on our letter of credit, including the junior tranche and senior secured facility. Our liquidity remains intact at the level we anticipated. We had approximately $1.3 billion at year end, comprised of cash on hand, secured note commitment, of which we drew $250 million in January, and covenant capacity. Revenue for the fourth quarter of $848 million, an 18% increase year-over-year. Excluding the impact of foreign exchange currency fluctuations, fourth quarter revenue was $905 million and $25 million above guidance at the midpoint. Adjusted EBITDA for the quarter was -$26 million, a $257 million improvement year-over-year and a $50 million better than midpoint of guidance. During the fourth quarter, we continued to see strength in our space as a service business, with consolidated occupancy rising to 75%, a 12% increase year-over-year. For some regional color on occupancy at year-end, U.S. and Canada reached 70%, up from 62% year-over-year. International was 83%, up from 68%. Latin America was 73%, up from 59%. Japan was 66%, up from 47% year-over-year. At the market level, for some of our largest markets, occupancy ended the year at New York City 72%, London 81%, Mexico City 68%, São Paulo 84%, Paris 80%, Seoul, Korea, 94%, Los Angeles 68%, Boston 67%, San Francisco 83%, and in Singapore at 82%. Some highlights in other markets include Berlin 85%, Toronto 84%, Warsaw 91%, Munich 99%, Miami 96%, Nashville 94%, Milan 92%, Madrid 96%, and even Prague at 91%. Our market share continues to increase, and our occupancy continues to rise. It reminds me of the e-commerce to bricks and mortar relationship. When the e-commerce sales were rising and bricks and mortar stayed flat or declined, the pool was the same, but the market share shifted. As you'll see in our earnings deck on pages 22 and 23, the growth pace of our market share accelerated during the fourth quarter. In New York, our fourth quarter desk sales equated to 23% of the total square feet leased in the traditional market. While our portfolio accounts for approximately 1% of the total office stock. Similarly, in Boston, our market share was 21%, Chicago 19%, San Francisco 13%, Dublin 8%, Paris and Berlin 11%, and London a whopping 44%. Today in Bloomberg, okay, it was stated a quarter of London companies downsize offices and shift to flexible work solutions. Again, our value proposition is front and center. As occupancy continues to rise, the incremental revenue outpaces the incremental operating expenses, thus increasing building margin, illustrating the operating leverage of the WeWork platform. Fourth quarter building margin was $144 million, up $153 million year-over-year. Two-thirds of our markets are now over 70% occupied and account for 75% of revenue in the fourth quarter. Let's focus on memberships. The memberships rose to 547,000, a 17% increase year-over-year. We leased approximately 10 million sq ft in the fourth quarter, including renewals. As you can see, it's been fairly steady through all of 2022. Average commitment term remained flat at 19 months. Our ARPU, the price we charge per month for the desk, was $481 in the fourth quarter, up slightly from the third quarter. As a reminder, ARPU was impacted by unfavorable foreign exchange movements during the year. Excluding the foreign exchange moves, our ARPU would have been $514 in the fourth quarter, up over 6% year-over-year. Our All Access business continued its growth, ending the quarter with 70,000 members, a 56% increase year-over-year. Now a business started only two years ago that is generating $200 million of annual revenue. ARPU for All Access was approximately $240. All Access continues its growth trajectory in January with the second highest month ever of gross deals, higher ARPU and lower churn. We recently expanded the on-demand offering to our locations in Brazil, and we are launching our first access lounges in February in New York and London. Since mid-2022, we've been actively marketing our Workplace product and now have over 290 companies signed and 51,000 licenses. At the end of Q4 2022, that number was about 220 companies and about 42,000 licenses. It has accelerated in January. The TAM for the WeWork Workplace business is estimated to be approximately $3 billion just in the U.S.A. and a multiple of that globally. The driving force behind the shift to flexible solutions is not dissimilar to the environment that contributed to the rise of WeWork at its founding. In the wake of the global financial crisis, businesses of all sizes faced uncertainty. They not only were looking to optimize their costs, but they were looking for a new solution to work. With intentional design and human connection at the forefront of our product and brand, WeWork not only solved for bringing people together with intention, but also for greater flexibility with turnkey short term options. Since then, we've clearly created a category of our own, separate from the traditional market. While we've concentrated on transforming our business, we've equally focused on listening to what our members need in order to continuously innovate and build solutions that go beyond physical space. Just yesterday, the Harvard Business Review released research on how co-working spaces can positively impact employee well-being. As part of their results, they say, "Respondents experience working from a third place like a co-working site as more socially fulfilling than working from the office or from home." From the office, an increase of 64% and home, 67%. They went on to say one major reason is that a co-working space offers not just the flexibility employees crave in terms of where they work, but also with whom. As businesses face uncertainty around the future of work, our origins still ring true as our strongest differentiator. Ramp, which is a corporate card and spend management software provider which released their Q4 Spending Benchmark report, found that businesses are increasingly moving to flex workspaces, and specifically cite WeWork as spending with WeWork increased 90.7% in 2022. In fact, WeWork consistently ranked as the second largest office vendor through the year just behind the Microsoft Store. Our increased market share is a testament to the value of our product and the variability of our offerings. From our access products which solve for a more hybrid and evolving world with immediate and frictionless access to workspace at a global scale. To our dedicated space with full service amenities on flexible terms, we are best positioned to help companies of all sizes define their future of work. Now with WeWork Workplace, our solution has rounded out our site of offerings by enabling companies to efficiently manage the size, cost, and employee experience of their workspace. We continue to see this come to life as companies save on their real estate costs by switching to WeWork space paired with Workplace and All Access. Turning to our portfolio, as I stated before, our strategy is to continually improve the quality of the portfolio by opening new locations where it is economical and where we see demand, and exiting underperforming locations. Our portfolio strategy is similar to a retailer's approach to their store fleet, whereby investments are made into high-performing stores and lower performing stores are pruned from the portfolio. We continue on our ongoing efforts to optimize and enhance our global real estate portfolio by executing deals for new locations. In December, in Houston, we expanded an existing management agreement for 26,000 sq ft. In Israel, we leased a new 12,000 sq ft location for use by a large technology company. In January, in London, we expanded our presence by 27,000 sq ft at 123 Buckingham Palace Road. In India, we leased two new locations encompassing 63,000 sq ft in Bangalore. Lastly, in Scottsdale, we entered into a new management agreement for 30,000 sq ft. With 2022 behind us, we're now focused on 2023. We expect first quarter revenue to be $830 million-$855 million at spot FX. The midpoint of guidance is 10% higher year-over-year. We expect first quarter Adjusted EBITDA to be between negative $25 million to breakeven. Achieving the midpoint of guidance would be an increase of $200 million year-over-year. As we continuously improve the portfolio, we're simultaneously refining our internal operations and resources. During our last earnings call, we estimated our annual SG&A run rate to be approximately $725 million. As a result of previously announced workforce reductions and other planned savings initiatives, we anticipate the SG&A this year to be about 10% lower than the previous run rate, so that would be approximately $650 million. Our goal of generating free cash flow later this year remains intact, but we have significant work to get there. First, somewhat out of our control is the pace of the recovery in the U.S., our largest market by revenue. As I challenged our team in 2022 to be to be Adjusted EBITDA positive, we set the same challenge for us this year on being free cash flow positive. In addition, we are pursuing significant reductions in our operating cost, SG&A, and capital expenditure. Our goals this year are focused on continued growth in our financial results, portfolio optimization, and balance sheet improvement. We have the right team in place at the right time to achieve our goals. I remain incredibly confident about the short-term and long-term success of the business. Andre will now provide some additional commentary around our financial results, outlook, and capital transactions. Thanks, Sandeep. Good morning, everyone. I'll provide some additional color regarding both our fourth quarter and full year financial results. First, total company revenue was $848 million in the fourth quarter, up 18% year-over-year, and up $31 million sequentially from the third quarter. As Sandeep mentioned, on a budget FX basis, fourth quarter revenue of $905 million was above the $870 million-$890 million guidance range we provided previously. Quarterly sales benefited from higher membership revenue, continued growth in WeWork All Access, and improved pricing. For the full year, consolidated revenue of $3.25 billion was up 26% versus 2021, driven by a 12-point increase in physical occupancy and a nearly 80,000 increase in physical memberships. Foreign exchange, namely a weaker euro and British pound, had an approximately $140 million negative impact on our total annual revenue compared with the company's original budgeted foreign exchange rates. Building margin continued its positive trend in the fourth quarter, rising to $144 million, which was up $39 million sequentially and up $153 million year-over-year. Despite higher membership revenue and higher occupancy, we were once again able to reduce our OpEx through planned building exits as well as efficient expense management. On the earnings line, we narrowed our Adjusted EBITDA loss to $26 million loss in the fourth quarter, the smallest reported loss in our history, helped by the higher revenue, lower OpEx, and continued reductions in our SG&A expenses. Fourth quarter SG&A also benefited from a reduction in incentive compensation since despite the improvement in Adjusted EBITDA in Q4, the company slightly missed the full year revenue guidance provided a year ago. Our SG&A run rate ended the year at approximately $700 million. As Sandeep just mentioned, we're expecting a further reduction of SG&A of approximately 10% this year. Our net loss for the fourth quarter was $527 million. The net loss was driven primarily by impairment on the buildings we are exiting, as well as depreciation and amortization expenses, partially offset by unrealized foreign currency gains. Now moving on to cash and liquidity. We ended the year with just under $300 million of consolidated cash on the balance sheet, which was in line with our previous projections. Our cash burn for the full year was approximately $968 million, which was also in line with estimates. Our free cash flow continued to improve in the fourth quarter, narrowing to negative $156 million, which was a $49 million sequential improvement from the third quarter, driven by the operating improvement we discussed previously, as well as lower CapEx. Net CapEx for the quarter was $19 million and $176 million for the full year, which was a $243 million reduction year-over-year. With little in the way of new capacity expected to come online in 2023, we expect a further reduction in net CapEx in 2023. On liquidity, as Sandeep mentioned, we ended the year with cash, commitments, and debt covenant capacity of nearly $1.3 billion. In January, as we reported via 8-K, we drew $250 million on our senior secured line from SoftBank, leaving $250 million undrawn to fund our upcoming liquidity needs. Just this week, as Sandeep mentioned in his remarks, we completed an amend and extend of the $350 million junior LC tranche of our existing LC facility. As part of the transaction, the junior LC tranche was upsized to $470 million. The maturity was extended from November 2023 to March of 2025. A new lender was added, the SoftBank Vision Fund II replaced SoftBank Group as an obligor under the same structure as the senior LC tranche that we amended in December. The amend and extend was approved with the consent of the senior LC lenders, and the transaction closed this week. When combined with the previously announced maturity extension of both the senior LC tranche as well as the senior secured notes, we've now extended our debt maturities supporting the wholly owned business to 2025 and providing us with additional runway as we continue down the path to profitability and positive cash flow. Regarding the first quarter, as Sandeep mentioned, we expect consolidated first quarter revenue to be in the range of $830 million-$855 million and Adjusted EBITDA in the range of -$25 million to break even. On the revenue side, there is some seasonality in our business, which usually results in a slower start to the year due to higher churn or larger number of commitments ending in December. On the earnings side, we'll continue to see savings in both OpEx and SG&A in the first quarter and beyond. The latter was helped by a nearly 10% reduction in our workforce that we announced in mid-January. That concludes our prepared remarks. Thank you all for your continued support. With that, I'll turn it back to the operator to open the line to questions. As a reminder, if you would like to ask a question, simply press Star One on your telephone keypad now. Your first question comes from the line of Vikram Malhotra with Mizuho. Your line is open. Good morning. Thanks for taking the questions. I guess just to start off, Sandeep, can you maybe just outline the visibility you have in terms of committed revenue or just known terminations or move-outs heading into 1Q and maybe just the first half? You usually have, like, a two-quarter visibility. Just given all the tech the layoffs, and the churn, I'm just wondering how much visibility you have. Good morning, Vikram. You know, we actually look at the committed revenue, and we compare it to you know, to 2022, and we follow a pattern through the entire year when we look at our budget preparation. We're very pleased to sit back and say that when I looked at, you know, where we were in Q1 2022 and where we are in Q1 2023, we're actually slightly ahead from a year ago, which is what gives us confidence in being 10% higher year-over-year. Again, you know, we have fairly good visibility going into Q2. But over the last couple of quarters, we've been very focused on providing guidance for the current quarter. The reason is the uncertainty really that we see in the U.S. recovery. We have seen an acceleration of the U.S. recovery in January and February. At this moment in time, you know, there's a high level of confidence in the guidance we've provided you. Also, I would like for you to appreciate that the guidance includes the closure of 40 locations, which we announced at the last quarter. As you are aware that we do transfer about 70%-80% of the revenue, you know, from the closed location to alternate locations. When you look at the reduction in the number of members that relocate and the reduction in the revenue, there's actually a slight acceleration in revenue in Q1 of 2023 versus Q4 of 2022. Okay. That's helpful. How should we think about the impact, you know, from all the technology churn that we're seeing both in enterprise and SMB now that we've had, like, two quarters of, you know, bigger announcements around layoffs? You know, can you just maybe qualitatively even just describe what are some of the larger enterprise users telling you, in terms of their space needs or rationalization versus how does that compare and contrast with SMB? Great. Vikram, you know, to put that in perspective, in generally the companies have announced workforce reductions are the same companies that went on a hiring spree during the pandemic, and today still employ more than before the pandemic. We have been impacted in certain locations. We talked about the higher churn in Q3, mostly due to these actions by less than a handful of our enterprise companies. On the positive side, our space dedicated to enterprise members are generally the full floor plates and multiple floor options and are relatively well leased. As those spaces become available, we do have a pipeline to replace them. For example, it made news that one of our leading tech companies had vacated our Mountain View, California location comprising of 400,000 sq ft. We have already backfilled the space with three new enterprise members. Interestingly, all three enterprise members are technology companies, and one of those enterprise members used our space for their corporate headquarters. More so, what we are seeing is newer companies and newer technology companies and non-technology companies and other non-tech companies that use technology are hiring people and taking advantage of the current layoffs. Just yesterday, we signed an agreement with a pharmaceutical company for a full floor in Seattle. Again, their move to Seattle was triggered by the tech layoffs and then taking advantage of the ability to find talent. Just one last point I will make is that we do have 30,000 unique members, so we have a pretty diversified portfolio, and tech accounts for about 15% of our business. Okay. That's helpful. Just one last, Andre, just if you could clarify. I think quarter end cash balance was a little under $300 million. If I take the $250 million you drew, you know, you have cash of a little, a little over $550. Am I correct the upsized junior LC, the $120 million upsize that was used to pay the step down in the senior tranche, and therefore the kind of run rate cash balance is around $550 million? I mean, I guess Andre is looking at me. Well, no. We were debating who should answer the question. The answer to the question is, you know, the upsize in the letter of credit facility, you know, does compensate for the downsize of the senior LC from $1.05 billion to $960 million. It's about $90 million, and the upsize is $120 million. Effectively it does provide $30 million additional working capital and does take into account the $90 million reduction. More importantly, the upsize of the LC facility, actually in the junior LC facility is more advantageous to us as the LCs burn throughout this year, approximately about $30 million a quarter, we can actually use that money into working capital. Versus in the senior LC facility, had it stayed at the level it had stayed, and as the burn downs occur, that money is not available to be drawn for working capital. This is actually an advantage from a liquidity perspective. Okay. Thank you. Your next question comes from the line of Tayo Okusanya with Credit Suisse. Yes. Good morning, everyone. The EBITDA guidance and revenue guidance for 1Q, again, those numbers are very similar to kind of where you were in 4Q 2022. Again, wondering exactly, you know, if there's some seasonality to that number, and kind of how do we think about 1Q in the context of 4Q, especially given, you know, all the great progress you've been making through 2022. I think again, to an extent, we were somewhat expecting to see a little bit more of that in 1Q 2023, but the numbers are very similar to 4Q. Good morning, Tayo. Again, as I mentioned in my prepared remarks, you know, there is seasonality in our business, and I think Andre Fernandez mentioned that as well. Generally the largest churn occurs in the month of December because there a lot of contracts are annual and calendar year. We start to see the larger churn, and that churn, okay, has an impact really only on January revenue. As a matter of fact, from February onwards, as the new leasing activity that we have conducted in Q4 starts to take occupancy, that the revenue starts to increase in February and continues to drive through in the month of March, and which is what we're seeing as we are now in the middle of February. In reality, though, the revenue actually went up, as I mentioned, you know, quarter-over-quarter, because what you have to take into account is the 40 closures that we announced in Q3, which were mainly executed in Q4 by the end of December. 70% of the members transferred to newer locations, 30% didn't. We did compensate, okay, for that, for that loss of memberships, which is about, I think, 3,000-5,000 members. We compensated for that and increased our revenue. To answer your question, there is an increase quarter-over-quarter because of that shift, plus there is a level of seasonality. Last point I will make is, as a matter of fact, in the international markets, okay, Q4 was the best leasing quarter in the history of this company. The positive impacts we're starting to see, like I said, in February and accelerating into March and further accelerating into Q2. I would also say on the earnings line, you'll see that we're going from -$26 to $0 to -$25. Remember, in my remarks, I mentioned we took a slight credit in our incentive compensation in the fourth quarter. Actually, if you go now into the first quarter where you're starting to accrue at a normal incentive comp rate and you're still able to improve earnings from $26 now to something between $0 to $20-$25 on comparable revenue, I think just shows you the additional cost that we're taking out of the organization. That's very helpful. Just one quick follow-up. In regards to the Workplace product and My Access, how do we kind of think about the contribution of those businesses to the bottom line in 2023? Let's just focus on All Access. You know, we did end the year at about 70,000 members. As we mentioned again, I think in the last call, you know, we would be increasing capacity. If you remember in the beginning of last year. Yep We talked about the capacity being limited to 70,000-75,000, which of course we reached capacity end of last year. That's allowed us to open up additional capacity, one, not only within our spaces, we are opening pure All Access lounges in New York and London. Because in certain markets, we have actually exceeded our capacity, we're actually using capacity of third parties for our All Access product. We continue to see a lot of confidence in that business. We do anticipate, you know, a 20%-25% increase, you know, in contribution on top line revenue by the All Access business. As I switch over to Workplace, you know, we officially launched it, you know, late last year. We actively started marketing it in the fourth quarter of 2022. As I mentioned at the end of the year, we had over 200 companies and over 40,000 licenses signed, and that has accelerated to 290 companies and over 50,000 licenses signed in January. I almost equate it to where it was, where, you know, where All Access was two years ago. A lot of these companies that are signed are large enterprise clients, who are trying it in, you know, in smaller locations. We do believe that as they scale our product into their entire organizations, there could be an acceleration of licenses as we go through the year. We're not anticipating a major contribution this year from the Workplace product, as it is an early launch, but we're very optimistic as to its progress. One last point on it, Nick, and I'm being a little repetitive. You know, when we entered this business, we're actually using the technology that we built, and we married that with our, you know, partnership with Yardi, who's a leader in the business of software management for properties, to actually build a product. We also did that and used a outside consultant to determine what the TAM, the total addressable market was. The U.S. TAM was quite large at $3 billion. We will see what percentage we capture, but even if we capture a small percentage, it'll be a large contributor in the long term to WeWork's top line revenue. Thank you for the commentary. Your next question comes from the line of Alexander Kramm with UBS. Yeah. Hey, good morning, everyone. Understand of course, that you're only given first quarter guidance given some of the uncertainties out there. Maybe remind us about budgets for the full year, and you don't have to be specific on revenues and EBITDA. How do we think about new locations opened, ARPM trends and other major KPI that may have changed as you think about 2023? Let me just rewind you to 2022 to give you an idea. In 2022, I think our revenue went up $700 million, okay? That's a, you know, if you think about the business that we're in, that's just an, you know, it's a very good increment. Occupancy went up 12 points, right? You know, we do see an acceleration, as I mentioned, in Q2 and continuing through the year. We do see, you know, the revenue increase in 2023. As I said, we've challenged the teams by year-end to be, you know, free cash flow positive. In the international markets, demand continues to be incredibly strong. you know, we have reached, you know, 83% occupancy, and we know the trends have continued to be positive in the first 45 days or so of this year. ARPM, you know, in the international markets are increasing. The increase in ARPM that we demonstrated this quarter is really as a function of the international markets. As the pandemic level pricing rolls, we're able to basically go to, you know, pre-pandemic pricing in our international markets. Again, sticking true to our original projections that once you get past 70% occupancy, you can start having some pricing power. You can, and when you get above 80% occupancy, the margins in our business at the building level, you know, is between 25%-35%. Everything that we projected, you know, in late 2021, early 2022, the results are coming into fruition. As we sort of look in the U.S., you know, again, like I said, we are starting to see, you know, we're starting to see the comeback to work having a much bigger impact. I did mention, you know, you know, earlier when Vikram asked the question about tech, I said the tech companies have hired actually more people through the pandemic, and the layoffs still, you know, you know, will result in having more employees in those companies than pre-pandemic. Again, for those companies, as they come back to work, we become a natural extension to take up space. We're cautiously optimistic as we start to see the rebound. Last point I will make is that what we found, which I don't think we fully anticipated when we announced the closures of the 40 locations, we did appreciate that we would create a relocation of 70%-80% of our members. What we didn't anticipate is the demand would actually go up, you know, by potentially new members as they sort of look forward and realize that WeWork could be WeWork space could be at a premium. We saw that in market like Chicago, whereby we closed a couple of locations, it took our occupancy up. What it also did was it increased our market share to 19% of the market in Q4. We're starting to see that as our supply is getting minimal, you know, people are not staying by the sidelines. They're actually reacting to get space. Look, we're cautiously optimistic, but, you know, as I've said over and over again, the U.S. has been sluggish versus the rest of the world is, you know, back to pre-pandemic levels. Okay. Just to be a little bit more specific then, and maybe I don't remember these numbers right, but I do feel like in the past you committed to something around 50,000, I guess work capacity added by in 2023. Then also I think historically said something around occupancy potentially trickling higher 2% a quarter. A, are these numbers right? B, should we still hold you accountable to that, or is there just too much uncertainty that it's hard to commit to any of these numbers? Yeah. We do expect occupancy to rise this year. If I was to provide full year guidance, I am actually not doing full year guidance. I'm providing guidance for Q1 and providing you commentary on what I see in the business. We did add 50,000 new members last year. You know, occupancy did go up 12% last year. You know, we do expect a moderation of that number this year. The reason for the moderation is much more driven by the high occupancy in the international markets, giving us less inventory to sell than driven by the demand characteristics, right? The aspect here is that occupancy in the portfolio is 75% today, and we do expect that to rise to the end of the year. Okay, thanks for clarifying that. Just one quick follow-up. The $650 million target for SG&A, is that a run rate at the end of the year? Is it a full year achievement? How should we be thinking about that number? Full year achievement. That's correct. Okay, fantastic. Thank you very much. Thank you. Your next question comes from the line of Tom Catherwood with BTIG. Thank you. Good morning, everybody. Maybe I want to go through the ins and the outs on your number of locations. First, just wanna loop back on some things that you said about closures. Sandeep, it sounds like the bulk of those locations, the 40 you had talked about previously, were closed at year-end. Are there any kind of still left to occur in 1Q, or is that fully off? As part of that 40 closure list, it's basically all done. There were a few stragglers in January, but as of now, they're all completed. You know, we do, you know, continue to, you know, look at our portfolio. As I said, you know, we achieve increase in EBITDA and drive towards, you know, cash flow positive by continuously looking at our portfolio. We will continue to review our portfolio, but as it relates to that 40, I believe as of now they're all done. Perfect. Perfect. Thank you for that. Then if we think about the ins throughout the year, there were some that you had announced in fourth quarter, some new management agreements back then. There were some build outs still happening and obviously the new ones you announced today between Bangalore, Scottsdale and London. How many more do you have coming on in 2023, and what do you expect to be the pace of those deliveries? Obviously we're looking at it very opportunistically in markets that we perform incredibly well. I do expect the India business to continue to grow this year. you know, it is at a very high occupancy and has been profitable for quite some time. We do expect the Israel business to grow as well. At this moment in time, if you would, you know, I expect essentially, you know, the desk count, you know, to be flat for the year with new desks added to the inventory. I also do expect a little bit of pruning as the year progresses. Got it. Appreciate that, Sandeep. Andre, just one last one from me. You mentioned obviously that you expect 2023 CapEx to moderate compared to 2022's spend. It sounds like you continue to expand the All Access lounges, so there's some spend there. There's obviously the new locations you're adding on. What do you expect if you have a sense of either the magnitude of CapEx spend or kind of how the pace could be throughout the year? What are your expectations that you have built into your outlook? Yeah, I think it's related to the conversation we just had too, right? About the number of particularly day one or to the extent we open new facilities that requires some CapEx. I think there's some variability there with respect to the new opens versus the quote unquote, the day two CapEx, which is the maintenance CapEx. I think we've got a good, you know, understanding of what that is. On a run rate basis. It's really the day one that ultimately is gonna drive the variability. Listen, I think if you look at the fourth quarter, that's unusually low. I mean, at a net CapEx of $19. That benefited because you didn't have a lot of opens in the fourth quarter, but you had a lot of TA coming in from your third quarter, that brought the net number down in fourth quarter. I don't think the $19 a quarter is the correct run rate, something higher than that. If you figure, okay, could you get to, you know, something around. You know, again, we spent $176 in 2022. Could you get something down, you know, in the $100 or low $100s range? I think that's very achievable for the year on a net basis. Perfect. That's it for me. Thanks, everyone. Your next question comes from the line of Alexander Goldfarb with Piper Sandler. Good morning. Morning. Just a few questions, Sandeep. You know, first, the big picture, just wanna make sure I heard correctly. You know, obviously, everyone's focus is cash flow profitability. Last quarter, you know, because of FX, you'd pushed it from mid-middle of this year to late this year. Great to see, you know, sort of FX be a positive impact in the fourth quarter. Obviously, we don't know what this year is gonna be. You know, do you still stand by from what you see now that end of this year is when we'll see cash flow profitability? Alex, as I've said a few times today, look, We drove the team last year to be Adjusted EBITDA positive by December. We achieved Adjusted EBITDA positively, you know, by, you know, more than a few million dollars, which was a very good... Again, we are driving the team this year to achieve, you know, you know, to be free cash flow by year end. You know, you know, as long as the U.S. market doesn't deteriorate. It doesn't really have to accelerate, okay? You know, we do believe that is achievable. Okay. The next question, hopefully you'll humor me, Sandeep. You know, obviously, you know, we think that you've done tremendous for what the hand you were dealt, you've performed. There's still a narrative out there about, you know, restructuring, debt restructuring, et cetera. You know our views. We've written our views. Just, you know, sort of any comments to help squash, you know, some of the naysayers that say like, "Hey, you know, there needs to be restructuring." I mean, certainly you did a great job on the refinancing of the debt. SoftBank gave you a pass on temporarily not charging you certain fees as you transition through. Is there anything that you can elaborate to help sort of squash the narrative that's out there? You know, I, you know, Alex, always say actions speak louder than words, right? You know, I think the fact that we actually moved the 2020, you know, the 2020 through 2023, you know, maturity to 2025 is an indicator of the confidence in the market to us to actually be able to push that maturity to 2025. We've always maintained, I maintained this, you know, for over a year, that once we get to Adjusted EBITDA positive, we will focus our attention on the balance sheet and start working on, you know, towards the end of this year as we have more visibility. We'll start working towards the extension of the debt maturities, and in thinking of to learn to walk before running. We actually don't see a need, you know, for, you know, additional, you know, liquidity for 2023. We feel that we're in a good position, and that'll allow us to also discuss, you know, the debt extensions with our debt holders. Like I said, our actions have continued to prove that we've continued to improve our business and continued at each event to extend our maturities as they come to expiration. Okay. Just the final thing. Andre, as CapEx, you said to the prior question, will come down versus 2022. Yeah. You guys also, if I heard correctly, spoke about possibly leasing new spaces. The CapEx isn't just on existing space that you've already leased that you're building out, but sounds like you're also taking some incremental space. Did I hear correctly? Maybe just elaborate how you view new space versus your existing space that you've leased but it's not yet open. Let me answer that, Alex. I think Andre gave a range of 100 to low hundreds for day one and day two CapEx. The deals that we've actually signed are fully funded from a tenant allowance perspective by the landlord, the one in London, which is fully funded. The other transactions are essentially management agreements as they are in Houston and in Scottsdale. Our India operations, as you may have heard, that they raised money through Barings. That raise of money through Barings, which closed, we know was actually raised for expansion of that business. It's a fully funded operation. Okay. That's awesome. Thank you. Thank you, Sandeep. Your next question comes from the line of Brett Knoblauch with Cantor Fitzgerald. Perfect. Hi, guys. Thanks for taking the question. I guess you talked about the fourth quarter being one of your best quarters in terms of leasing activity ever. Could you maybe just, you know, I guess, qualitative about how... The type of rates you're getting on those properties compared to previously, I guess you see a lot of weakness in the commercial office property space. I was just wondering if that's allowing you to kind of get more advantageous pricing. I would sort of sit back and say, as I mentioned again in my earlier comments, if I look at the progress that we've made, right? We leased about 206,000 gross debts, on a consolidated basis, 165,000 gross debts. In Q1 2022, it was 166, about the same. That's why we continue to maintain the demand for our space has continued to be very strong. You know, again, once you get past that 70% occupancy number, you start to get pricing power, which is again, what we've seen, at least in the international markets, is very prevalent. As I mentioned in the international markets, our pricing is, you know, at pre-pandemic levels. The, you know, it's a slow increase when you look at it from a reporting perspective because obviously the base has still got a lower ARPM, and so the impact of the new leasing is small. But we are seeing in that. And like I said, in the international markets, the reason for seeing the strength is the flexibility that we offer, okay. Even though the larger market could be soft, the flexibility is very important. The turnkey solution to the clients are very important. And really what's the icing on the cake is the space is available today, right. Effectively, having space available today that's turnkey and that's flexible, okay, as people, you know, you know, start to come back, you know, you know, to work in those international markets, the demand actually increases. Again, just to reemphasize the number of companies that have hired more during the pandemic. Even if you account for the layoffs, it's still higher. The last point I'll make, you know, why our SMB business is so strong in the United States is in 2021, I think, there were five million new businesses. I think in 2022, there were 11 million new businesses. Our SMB business is about 50% of our business. We've seen an incredible strength in our SMB business, which has more than made up for the churn of the enterprise clients. In the U.S., you know, you know, we are, you know, not seeing pricing power yet. We just about hit 70%. The international markets, we are seeing very good pricing power, even though there's a softness in the market for me, overall, commercial office market. Got it. No, that makes sense. I guess when you talked about, you know, being Adjusted EBITDA positive in December. I guess the first quarter, you know, guiding midpoint -$12.5 million. Is that really just because of the kind of elevated churn impacting January revenues plus the accrual on the incentive comp? No, I would say the two reasons for it are that when you look at quarter-over-quarter, one is that there is the elevated churn, like I mentioned. And the second is when you close locations, okay, you are, you know, moving 70% of the revenue. If you take into account, you're losing 30% of the revenue. You actually have to comp that quarter-over-quarter. Again, like I said, you know, the, you know, we're guiding to the -25% to 0%. Obviously, we'll do everything in the next 45 days to deliver, hopefully a better result. Perfect. Thanks, Sandeep. Really appreciate it. Your next question comes from the line of Vikram Malhotra with Mizuho. Thanks so much. I just wanted to clarify two things, maybe Andre or Sandeep. Just based on all your comments around the $30 million incremental, I just wanted to clarify. It's roughly, if I just did the math correctly, you have $600 million of cash run rate for working capital needs. Do you still have the access to the additional $250 million from SoftBank, and then an ability to go out and raise an additional $500 million of debt? Is that all intact for working capital? Yeah. I mean, again, like I said, it's slightly advantageous, right? You have the $250, which is completely intact. Let me just reemphasize what I said earlier. When we increased the $350 to $470, even though that $120 million, $100 of it was cash collateralized for letters of credit. Those letters of credit burn through the entire year at about $30 million a quarter. We can use that $100 million in working capital. In an ironic way, the increase in the junior LC actually allowed us to tap into the capacity that we had of the senior secured, that additional $500 million senior secured. We've actually, in a way, accessed $100 million of that if we need, we can use for working capital. actually, our cash, our ability actually increased by effectively $100 million. Sandeep said that when those LCs burn down, that that cash is returned to us as if we had monetized part of that unused capacity. Your other question was, yes, we still have $250 million available to us on the SoftBank line. An ability to raise an additional $500 if you need to. Yes. With again, like I said, you know, the $100 million goes against the $500 million, so. The $500. Okay. $400. Sorry. Okay. You have another $400 million. Okay. 400. Okay. Just one other thing. We've actually raised $100 by default. Right. Your next question comes from Tayo Okusanya with Credit Suisse. Hi. just to follow up about the extension of the junior tranche to March 2025. Were there any significant changes to the terms, such as, you know, do you start paying higher interest rates in 2024 or anything of that nature we should be aware of? Yeah. The pricing was marginally higher than the pricing of the paper that was distinguished. Obviously the amount increased, the term increased, and the time we placed the last paper was, as you know, when rates were lower. Yes, co-commensurately, the pricing was higher. I think we'll be filing an 8-K. We're providing all the details on the. Tomorrow ... tomorrow on the Good. Thank you. Thank you. ... on the L.C. There are no further questions at this time. Mr. Sandeep Mathrani, I turn the call back over to you. Once again, I thank you all for joining our call this morning and your continued support of WeWork. Have a great day, have a wonderful long weekend. This concludes today's call. You may now disconnect.