As part of a restructuring effort initiated in Q2 2023, CVS Health will cut 5,000 jobs as the company focuses more on healthcare services, according to the Wall Street Journal and other news outlets. WSJ reported that the cuts will primarily affect corporate positions rather than customer-facing roles in stores, pharmacies and clinics.
Since last fall, CVS has been beefing up its healthcare offerings, first with the September 2022 acquisition of Signify Health for $8 billion and the February 2023 acquisition of Oak Street Health for $10.6 billion. Competition in the “medtail” sector is on the rise, and not just in the pharmacy vertical: Amazon acquired One Medical in July 2022, and Dollar General enlarged its healthcare advisory panel in August 2022.
CVS’ restructuring plan, developed to “streamline and simplify the organization, improve efficiency and reduce costs,” according to a press release, has led to the company recording a $496 million pre-tax restructuring charge during Q2 2023.
The retailer increased revenues in Q2 2023 to $88.9 million, up from the $80.6 million generated during the same period in 2022. However, net income decreased to $1.9 million, down from the $3 million in Q2 2022.
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