CVS Health to lay off nearly 2,900 employees in cost-cutting push
4:35 pm Tuesday, October 01st, 2024
(Reuters) -CVS Health said on Tuesday it would lay off about 2,900 employees, representing less than 1% of its workforce, as the healthcare conglomerate aims to cut costs.
The reductions, part of the company’s previously announced plan, would primarily impact corporate roles and not frontline jobs in stores, pharmacies and distribution centers, it said.
Reuters exclusively reported on Monday that CVS is exploring options that could include a break-up of the company to separate its retail and insurance units, as it looks to turn around its fortunes amid pressure from investors.
Healthcare-focused investment firm Glenview Capital Management said on Tuesday it is engaged in private and “constructive conversations” with CVS to strengthen its operating performance.
“The company is operating well below its potential and has fallen short in its investment and actuarial approach in recent years, creating economic losses and volatility that pressures its people, its customers and its shareholders,” Glenview said in a statement, adding that it is not pushing for a break-up of CVS.
The hedge fund owns less than 1% of CVS’ outstanding shares, according to data compiled by LSEG.
CVS had disclosed a multi-year plan in August to save $2 billion in costs through measures such as streamlining operations and using artificial intelligence and automation across its business.
Last year, the company said it had eliminated about 5,000 non customer-facing roles as a part of its restructuring plan.
CNN, STAT News and other media outlets had reported about the job cuts.
(Reporting by Sriparna Roy and Mariam Sunny in Bengaluru; Editing by Shailesh Kuber, Shilpi Majumdar and Alan Barona)
