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February 7, 2024

Amazon healthcare divisions latest victims of big tech firm’s efficiency drive

Amazon healthcare divisions Pharmacy and One Medical will sustain hundreds of redundancies as part of an ongoing drive for efficiencies across the company.

By Greg Noone

Amazon healthcare divisions One Medical and Pharmacy will see hundreds of jobs cut, according to a statement from the big tech giant. The redundancies are the latest in a series at Amazon, which eliminated 27,000 positions between 2022 and mid-2023 in its creative units Prime Video, Audible, Twitch and MGM Studios. The announcement also follows a smaller set of job losses in Pharmacy announced in July.

“As we continue to make it easier for people to get and stay healthy, we have identified areas where we can reposition resources so we can invest in invention and experiences that have a direct impact on our customers and members of all ages,” said Amazon Health Services chief Neil Lindsay, in a memo to staff. “Unfortunately, these changes will result in the elimination of a few hundred roles across One Medical and Amazon Pharmacy.”

Image of the Amazon healthcare division Amazon Pharmacy logo on a mobile phone screen.
Though hundreds of positions will be cut at the Amazon healthcare divisions Pharmacy and One Medical, the announcement (Photo by Koshiro K / Shutterstock)

Amazon healthcare commitment is still firm 

Amazon originally launched Pharmacy in November 2020, following its acquisition of PillPack two years earlier for $753m. That commitment to the healthcare market deepened again in July 2022 with the acquisition of telemedicine services provider One Medical for an additional $3.9bn. Amazon’s foray into medical services has also met with several setbacks, including controversy about the privacy rights guaranteed for patients using its Amazon Clinic service, the failure of its joint healthcare venture Haven and the closure of its fitness-focused division Halo

“We have learned a lot in the years that we’ve been dabbling in healthcare,” conceded Amazon Health Services’ chief medical officer, Sunita Mishra, in an interview with Stat. “And it’s now made us more confident that we’re now on the right track.”

Big tech firm showing an appetite for perpetual restructuring

The latest redundancies in Amazon’s healthcare divisions seem largely unrelated to their performance, with the company overall posting positive results in its fourth-quarter earnings call last week. Rather, the job losses seem to reflect a broader efficiency drive across the big tech giant’s entire business, which peaked in January 2023 with the slashing of 18,000 roles in its e-commerce and human resources departments (a revision on the 10,000 positions it originally intended to cut two months previously.)

In an earnings call discussing Amazon’s fourth-quarter results last week, its chief financial officer Brian Olsavsky said that the firm was unlikely to splurge on recruitment any time soon. “Where we can find efficiencies and do more with less,” he said, “we’re going to do that as well.”

Read more: Amazon Rufus AI assistant launches in US

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