CVS Health said it is cutting about 2,900 jobs as part of a $2 billion cost-cutting goal.
The cuts represent about 1% of the healthcare company’s workforce, a CVS spokesperson told CBS MoneyWatch via email.
Some drugstore chains have struggled in recent years amid cutbacks from inflation-weary consumers, with shoppers reducing their spending on over-the-counter items. Walgreens plans to close to a quarter of its 8,600 retail outlets, as some customers have turned elsewhere to buy basic products.
In its statement, CVS pointed to “continued disruption, regulatory pressures and changing consumer needs and expectations,” adding that “it is critical that we remain competitive and operate at peak performance.”
In the most recent quarter, CVS said same-store sales for over-the-counter products fell 4%.
What to know about the CVS job cuts
CVS, which along with its drugstore chain also owns health insurance provider Aetna and pharmacy benefits manager CVS Caremark, among other brands, said the 2,900 cuts will primarily affect corporate roles.
“The reductions will not affect front-line jobs in our stores, pharmacies and distribution centers,” CVS said.
Employees whose jobs are part of the reduction will receive severance pay and benefits, including access to outplacement services, the company added.
“The vast majority of affected colleagues will be notified this week,” the CVS spokesperson noted.
Separately, CVS is reportedly conducting a strategic review of its operations, which could include a spin-off of the health care company Wall Street Journal reported, citing people familiar with the matter.
When asked about the report, the CVS spokesperson said: “CVS Health’s management team and board of directors are constantly exploring ways to create shareholder value. We continue to focus on driving performance and delivering high-quality healthcare products and services enabled by our unmatched scale and integrated model.”