Verily is to axe 15 percent of its workforce as it reportedly seeks to distance itself from Google owner Alphabet
Alphabet life sciences spin-off Verily is cutting its workforce by 15 percent, its president reportedly wrote in an email to staff.
CNBC reported the development at Google’s sister firm, as it undertakes a restructuring in an attempt to seek financial independence from parent company Alphabet.
Verily, formerly Google Life Sciences, was initially part of the Google X research division and was spun off as an independent subsidiary of Google parent Alphabet in 2015.
This is the first known tranche of layoffs at any division under the Alphabet umbrella, as the parent company explores cost cutting measures amid worries about the state of the global economy.
Last July CEO Sundar Pichai in an email to staff said Alphabet would slow the pace of hiring for the rest of 2022, saying the tech giant was “not immune to economic headwinds.”
Alphabet said that it had a total full-time worker headcount of 186,779 at the end of the third quarter – up from 150,028 last year.
Until now Alphabet has avoided the widespread job cuts that have hit other tech companies such as Amazon, Meta and others.
On Wednesday, in an email to employees, Verily CEO Stephen Gillett said the company will lay off 15 percent of its staff.
The cuts will affect about 240 people, a Verily spokesperson confirmed to CNBC.
Gillett’s email reportedly instructed staff to work from home for the remainder of the week as Verily’s physical offices will be closed on Thursday and Friday.
“Those who are in the office the office today can return home now,” the email reportedly stated, specifying that the instruction also goes for employees who work from Google offices.
Employees being laid off will receive an email sent to their Verily and personal emails entitled “Important Update Regarding Your Role.”
Those who still have jobs will receive an email titled “Your Role at Verily.” Those who work out of the US will hear from their business leaders on Wednesday or Thursday, the note stated.
“While communicating via email is not ideal, this was a deliberate decision, enabling us to communicate as efficiently and simultaneously as possible,” the email reportedly stated.
“We’re also taking today and the rest of the week to ensure each impacted Veep has a personal discussion with a leader and HR partner to discuss the details, answer questions, and provide support through the transition.”
Another project was called Project Baseline, an effort to aggregate health data with research organisations.
Verily also provided a Covid-19 testing platform, which former President Trump highlighted at the start of the pandemic.
According to CNBC, Gillett said the cuts reflect discontinued programs and team “redundancy.”
The email said it will offer severance and outplacement services “in the coming weeks and months” but did not provide details yet.
Gillett’s email also stated that it will be “reducing or sunsetting” some parts of the business while increasing investment in others.
Specifically, Verily will be discontinuing some early stage products, including “remote patient monitoring for heart failure and micro needles for drug delivery,” the email stated.
The email said the company would hold an all-hands meeting 18 January to explain the changes in more detail.
In September Verily raised $1 billion (£860m) in an investment round led by Alphabet, as it seeks to compete in an intensifying health tech market.
The investment followed Amazon’s announcement last July that it would buy primary care provider One Medical for $3.9bn.