Amazon is making some changes at its One Medical and Pharmacy units, with reports of layoffs impacting hundreds of employees. This move is part of a broader cost-cutting campaign that aims to save One Medical $100 million.
According to a spokesperson from Amazon, the layoffs will affect “a few hundred roles.” While one source mentioned around 115 positions being eliminated, another estimated up to 400 employees could be impacted. The announcement of these layoffs was initially scheduled before February 1 but was delayed due to internal issues and Amazon’s recent earnings report.
The cost-cutting mandate is aimed at reducing One Medical’s fixed cost structure. Amazon is pushing for significant reductions in operating losses, with a target of saving an additional $100 million this year. In 2022, One Medical reported an operating loss of $420 million before being acquired by Amazon.
Amazon Health Services Senior Vice President Neil Lindsay confirmed the layoffs in an email statement, expressing gratitude to the affected employees and emphasizing the company’s commitment to providing high-quality healthcare services.
The plan also includes consolidating marketing resources, integrating corporate functions, and implementing new AI tools to increase productivity and save costs. One Medical projects a significant decrease in fixed operating costs and aims to reduce the cost of each patient visit.
Since acquiring One Medical in 2023, Amazon has been exerting more control over the company. Tensions between the leadership teams have escalated, leading to changes in compensation plans and potential departures of executives.
Overall, these changes reflect Amazon’s efforts to streamline operations and cut costs across various business units, including healthcare.