International Workplace Group (LSE:IWG) reported continued revenue growth and network expansion during the first quarter of 2026, while warning that economic uncertainty and inflationary pressures are prompting additional cost-control measures.
The flexible workspace provider generated system-wide revenue of $1.17 billion during the quarter, representing year-on-year growth of 9%. Group fee revenue increased 4% to $958 million compared with the same period last year.
Revenue from company-owned operations reached $906 million, up 2% year-on-year, while revenue per available room rose 6% to $389 from $340 in fiscal 2025.
The managed and franchise division continued to deliver strong momentum, with fee revenue climbing to $39 million and total system-wide revenue rising 41% year-on-year to $260 million. Recurring fee revenue within the segment increased 80% to $16 million, reflecting continued growth in asset-light operations.
International Workplace Group added 213 net new locations during the quarter, taking total room capacity to 336,000, an increase of 48% compared with the prior year. The company’s pipeline also expanded further to 231,000 rooms, up from 227,000 at the end of fiscal 2025.
New centre signings accelerated significantly during the quarter, reaching 377 compared with 286 in the previous quarter, indicating continued demand for flexible workspace solutions despite a more uncertain economic backdrop.
Net debt increased by $143 million during the period to $858 million. The company attributed the rise primarily to seasonal cash outflows, including approximately $53 million in share buybacks, bonus payments, deferred liabilities and the implementation of a new automated invoicing system that accelerated certain supplier payments.
Despite the higher debt position, International Workplace Group maintained its FY2026 adjusted EBITDA guidance range of $585 million to $625 million. Management also said the company will introduce proactive cost reduction measures from the second quarter onward in response to inflationary pressures and growing macroeconomic uncertainty.
More about International Workplace Group
International Workplace Group is a global provider of flexible workspace solutions operating brands including Regus, Spaces and HQ. The company offers office space, coworking environments and hybrid working solutions across thousands of locations worldwide through a combination of company-owned, managed and franchised centres. Its strategy focuses on expanding asset-light operations while benefiting from growing demand for flexible and hybrid work models.
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