Amazon.com Inc AMZN has announced that it will lay off hundreds of employees at its One Medical and Pharmacy units as part of a major cost-cutting initiative.
What Happened: These layoffs are part of a significant cost-saving drive intending to save One Medical $100 million, as reported by a Business Insider on Tuesday. The layoffs are taking place within Amazon’s healthcare units, which include One Medical and Amazon Pharmacy.
The layoffs will affect a “few hundred roles,” confirmed an Amazon spokesperson. The total number of job cuts is still uncertain, with estimates ranging from 115 to 400 positions. The layoff announcement was initially scheduled before Feb. 1 but was postponed due to Amazon’s recent earnings report and other internal considerations.
Amazon did not immediately respond to Benzinga’s request for comment
The layoffs are part of a broader company mandate to lower One Medical’s fixed cost structure. Amazon’s leadership has tasked the healthcare company with drastically reducing its operating losses and achieving an additional $100 million in savings this year. In 2022, One Medical reported an operating loss of $420 million.
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Amazon Health Services Senior Vice President Neil Lindsay confirmed the layoffs in an email to Business Insider, stating that the company is grateful for the contributions of the affected employees and will support them in their next steps.
Amazon acquired One Medical during the pandemic, but the expected growth due to Covid did not materialize as anticipated, leading Amazon to take aggressive cost-cutting measures.
Why It Matters: This announcement comes on the heels of significant changes at One Medical. In September, CEO Amir Dan Rubin departed the company after six years, and COO Trent Green succeeded him.
Furthermore, in November, Amazon launched a new healthcare benefit for its Prime members in partnership with One Medical. This initiative aimed to make healthcare more accessible and integrated for Prime members, offering 24/7 virtual care and in-person appointments at One Medical’s numerous locations across the U.S..
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