IWG half-year results 2026: record revenue as network expansion accelerates

International Workplace Group delivered record revenue and accelerated network expansion during the first half of 2026, led by strong growth from its capital-light partnership model.

The headline growth figures are encouraging. However, International Workplace Group PLC also reported sharply higher overheads, weaker operating profit and a cash outflow before corporate activities.

That makes this a positive strategic update with a more complicated financial scorecard.

IWG's H1 2026 results at a glance

Key figure	H1 2026	H1 2025	Change
System-wide revenue	$2.4bn	$2.2bn	11%
Group revenue	$2.0bn	$1.9bn	6%
Adjusted EBITDA	$265m	$262m	1%
Operating profit	$38m	$68m	-44%
Adjusted earnings per share	4.6 cents	2.3 cents	100%
Cash flow before corporate activities	-$55m	$51m	Not meaningful
Net debt	$880m	$754m	17% higher
New centre signings	728	496	47%
New centre openings	425	338	26%

System-wide revenue includes revenue generated across IWG's wider network, including managed and franchised locations. Group revenue is the amount recognised directly in IWG's accounts.

This distinction matters because IWG is increasingly expanding through partners rather than taking on conventional property commitments itself.

The capital-light strategy is gaining traction

The strongest part of the announcement was Managed & Franchised, where IWG operates or licenses workspace locations without holding the underlying property leases.

System-wide revenue from this segment increased by 36% to $535m. Segment revenue rose by 31% to $105m, while total fee income climbed 60% to $80m.

Recurring management fee income, an important measure of the income generated from managing partner locations, increased by 84% to $35m.

The segment now represents 22% of system-wide revenue, up from 18%, and 32% of all open rooms, up from 25%.

There was also substantial operational growth:

• Managed & Franchised signings rose 72% to 711.
• Nearly 400 partner centres opened during the period.
• Open rooms increased 44% to 358,000.
• The pipeline reached 257,000 signed rooms which had not yet opened.

IWG said those pipeline rooms could generate more than $2bn of annual system-wide revenue once open and mature. That is management's expectation rather than revenue already secured, but it shows the potential scale of the pipeline.

Across the group, 98% of the 728 new centre deals signed were capital-light. This should allow IWG to expand its coverage without funding every new location through its own balance sheet.

The momentum builds on the progress reported in IWG's Q1 2026 trading update.

Company-owned locations delivered better pricing

The established Company-owned business also moved forward. Revenue increased by 5% to $1.9bn, ahead of IWG's full-year guidance for growth of at least 4%.

Revenue per available room, or RevPAR, increased by 11% to $407. RevPAR measures revenue against the workspace capacity available and provides an indication of how effectively that capacity is being monetised.

IWG said occupancy was maintained while rates increased as earlier promotional pricing expired. That suggests growth was supported by stronger pricing rather than simply adding more rooms.

Adjusted gross profit increased by 4% to $479m, although the adjusted gross margin remained unchanged at 26%. Management continues to target a margin of around 30% over the medium term.

Higher overheads held back profit growth

The main weakness was the gap between revenue growth and profit growth.

Adjusted EBITDA increased by just 1% to $265m despite the 6% rise in group revenue. Operating profit fell by 44% to $38m, while reported net income declined to $2m from $8m.

Group overheads increased from $250m to $315m. This reflected investment in sales, marketing and operational capabilities, alongside higher employee salary and bonus costs and the comparison with a one-off gain in H1 2025.

Marketing expenditure rose by $10m to $32m, while IWG spent $19m on its partnership sales team, an increase of $5m.

These investments helped generate record signings and openings, so the spending was not without a visible return. Even so, investors will want to see those operational gains translate into stronger earnings and cash generation.

Management expects marketing expenditure and overall overhead costs to reduce significantly during the second half. Delivery against that expectation will be important.

Cash flow and net debt need watching

Cash flow before corporate activities moved from a $51m inflow to a $55m outflow. Working capital, growth investment, higher tax payments and financing costs all contributed.

IWG said the first quarter was affected by the introduction of automated supplier invoice software, which caused payment days to fall and invoices to be settled more quickly. Conditions improved in the second quarter, when cash flow before corporate activities and mergers and acquisitions reached approximately $36m.

Net debt increased to $880m from $715m at the end of 2025. The increase also reflected $100m of share buybacks, dividend payments, bonus payments and bolt-on acquisitions.

The company strengthened its available financing by increasing its 2032 Eurobond to €500m from €300m. In July, it renewed and expanded its revolving credit facility from $720m to $1bn and extended its duration from 2029 to 2031.

IWG said it remains committed to maintaining its BBB investment-grade credit rating. Its bonds have fixed coupons and are hedged into US dollars, limiting direct exposure to changing interest and foreign exchange rates on that debt.

Shareholder returns continue

IWG returned $109m to shareholders during the half year, comprising $100m of share buybacks and $9m of dividends.

The company has announced $150m of buybacks for 2026, compared with $130m completed in 2025. During the first half, it repurchased 37,971,536 shares at an average price of £1.96.

The interim dividend increased from 0.45 cents to 0.48 cents per share. It is scheduled for payment on 9 October 2026 to shareholders on the register at the close of business on 11 September 2026.

Buybacks can improve per-share measures by reducing the number of shares in circulation. However, the capital returns need to be considered alongside the increase in net debt and weak first-half cash flow.

Guidance remains unchanged

IWG reiterated its 2026 guidance:

• Adjusted EBITDA of $585m to $625m.
• Company-owned revenue growth of at least 4%.
• Recurring management fee income of $80m.
• An investment-grade credit rating.
• Year-end leverage slightly above the December 2025 level.

The company also expects second-half cash flow performance to be ahead of the prior year and maintained its medium-term target of at least $1bn of adjusted EBITDA.

The full figures and accompanying notes are available in the original company announcement.

What matters for IWG investors now

IWG's strategic direction looks increasingly visible in the numbers. The Managed & Franchised network is growing rapidly, recurring fees are rising and almost all new signings require limited capital from IWG.

The concern is that this progress has not yet produced equally strong group-level profit and cash flow growth. Overheads rose substantially, operating profit fell and net debt increased.

The key test for the second half is whether lower overheads, maturing partner locations and stronger Company-owned pricing can convert record network activity into improved cash generation. If that happens while guidance is maintained, the first-half investment may look well judged. If costs stay elevated, investors may become less patient with the gap between expansion and financial returns.