Teladoc Health lays off 300 employees to cut costs

Teladoc Health lays off 300 employees to cut costs unknown

Teladoc Health is laying off about 300 employees, or about 6% of the virtual care company's non-clinician workforce.

The job cuts are part of a larger restructuring plan to reduce operating costs. In a filing with the Securities and Exchange Commission, Teldadoc said it was also reducing its office space footprint in some markets.

In a letter to staff, CEO Jason Gorevic said the company was cutting roles made redundant by its 2020 merger with Livongo. He also said the virtual care giant is focusing on sustainable revenue growth and profitability.

"The decision to reduce the size of our team puts our company on an improved path to profitability and necessitates our collective focus on our commercial business priorities — Primary 360, chronic care management, mental health and delivering true whole person care — along with continued growth in our BetterHelp consumer brand," he said. "We know that more than half our commercial buyers want the integrated, whole person strategy that we offer, and delivering value across our businesses is of even greater importance in this economy."

THE LARGER TREND

Teladoc struggled financially in 2022, racking up a $9.8 billion net loss through the first three quarters of the year, largely driven by non-cash goodwill impairment charges. But it posted a narrower loss in Q3, and it recently shifted its revenue range for Q4 to the higher end of its previous estimate.

"I get asked a lot about the competitive landscape. This is in stark contrast to many of the small competitors out there, whether they are public or private, who lack the scale to be able to take advantage of this financial discipline and deliver strong financial results consistently," Gorevic said at the J.P Morgan Healthcare Conference earlier this month.

Layoffs have become increasingly common in digital health over the past several months, with many companies citing a challenging economic environment. In January, diagnostics company Cue Health, hybrid provider Carbon Health, Alphabet subsidiary Verily Life Sciences and digital therapeutics company Akili Interactive were among the digital health and health tech companies to announce job cuts.