WeightWatchers CEO is suddenly out of a job
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Former WeightWatchers CEO Sima Sistani. Photo: WW International
The CEO of WeightWatchers is abruptly out of a job amid growing uncertainty about the company's future following its pivot under her leadership to embracing weight-loss drugs.
Why it matters: Tech executive Sima Sistani sent WeightWatchers in a new direction after she took over in early 2022, acknowledging that weight loss isn't necessarily a matter of willpower and acquiring a telehealth company that markets anti-obesity drugs.
Driving the news: WW International — the company's corporate name — said Friday in a surprise announcement that Sistani is exiting as CEO and as a member of the board.
- Board member Tara Comonte — who previously served as president and CFO of burger chain Shake Shack — is taking over as interim CEO.
- WW said Comonte would "sharpen its strategic focus, and evolve its behavioral and clinical offerings to drive growth."
The big picture: The shakeup comes after WeightWatchers' stock dipped below $1 in recent months as investors lost confidence in the company's outlook.
- The company turned a $23 million profit in its most recent quarter, but revenue fell 10.9% compared with a year earlier.
- Oprah Winfrey also left WeightWatchers' board earlier this year, though she later hosted an event featuring Sistani about how users of GLP-1 drugs like Wegovy and Zepbound shouldn't be stigmatized.
What they're saying: Morningstar analyst Sean Dunlop tells Axios that Sistani's departure "doesn't bode well" as it looks increasingly like weight-loss drugs are supplanting WeightWatchers for many would-be dieters.
- "With the proliferation of GLP-1 drugs, that appears to be the point we've hit, and the acquisition they made ... has apparently been insufficient to offset," Dunlop writes in an email.
Flashback: Sistani alienated some of WeightWatchers' most loyal members when she reduced the number of in-person meetings the company popularized, saying WeightWatchers needed to be more digitally minded.
- More recently, the company continued its cost-cutting with plans for an additional $100 million in annualized savings.
- But the stock has only fallen further since Sistani blasted "breathless media coverage" in March, saying in a statement that "our business is healthy, and we are well-positioned for the future as we continue our transformation."
The bottom line: WW's stock was down nearly 4% in early trading to 82 cents. The company started the year with a market value of nearly $700 million, a number that's dwindled to $65 million Friday.
