Jenny Craig to close locations as weight loss program borders bankruptcy

·2-min read

Jenny Craig has announced it will close hundreds of locations and its corporate offices, as the popular weight loss program reportedly struggles with $250 million in debt.

In a corporate email obtained by NBC News on 2 May, the weight loss company told employees it will shut its doors “due to its inability to secure additional financing.” The last day for both corporate and salaried field employees will be Friday 5 May, according to the outlet.

The announcement comes just one week after Jenny Craig employees received a Worker Adjustment and Retraining Notification (WARN) Act notice that it will close its facilities in San Diego, California, and New Jersey, as they begin “winding down physical operations” and warned of mass layoffs.

“Like many other companies, we’re currently transitioning from a brick-and-mortar retail business to a customer-friendly, e-commerce driven model,” a spokesperson told NBC News at the time. “We will have more details to share in the coming weeks as our plans are solidified.”

Bloomberg reported last month that Jenny Craig was grappling with roughly $250 million of debt, and would consider filing for bankruptcy if it were unable to find a potential buyer.

Jenny Craig operates more than 500 weight loss centers in the United States and Canada, but gave no indication in the email as to how many employees it plans to let go or how many stores will close. In the termination letter, workers were told they’d be given “final paycheck, including your full compensation earned through your last day of work and all accrued, unused paid time off.”

Founded in 1983, Jenny Craig rose in popularity for its weight loss program that offers nutritionally balanced diets. The company recruited famous faces like Kirstie Alley and Valerie Bertinelli as celebrity spokespeople, but has since faced increased competition with popular weight loss drugs like Wegovy and Ozempic.

The weight loss industry has been shaken by the growing popularity of prescription drugs being taken to lose weight. Ozempic, a once-weekly injection used for the treatment of Type 2 diabetes, skyrocketed in use after people were reportedly prescribed the antidiabetic medication as an “off-label” weight loss drug. Ozempic works by mimicking a hormone that regulates appetite, by creating the feeling of fullness. Meanwhile, Wegovy is another once-weekly semaglutide injection specifically approved for the treatment of obesity and weight loss.

Now, programs like WW – formally known as Weight Watchers – are also dipping their toes in the prescription weight loss business. Last month, the weight loss company announced it acquired Sequence, a subscription-based platform that offers telehealth appointments with doctors who can prescribe Ozempic and Wegovy.

The Independent has contacted Jenny Craig for comment.