Teladoc cuts 6% of workforce in restructuring

In a regulatory filing earlier, Teladoc Health disclosed that on January 18 the company announced a restructuring plan intended to reduce operating costs. In addition, the company underwent certain other cost-saving actions taken during the latter part of the fourth quarter of 2022. The combination of these actions results in a reduction of the company’s workforce of approximately 6%, and office space reductions within certain markets. "The fourth quarter actions did not have a material impact on 2022 financial operating results. Decisions regarding the elimination of positions are subject to local law and consultation requirements in certain countries, as well as the company’s business needs. In conjunction with earlier cost-saving actions, the company incurred approximately $4.4M in pre-tax charges in the fourth quarter of 2022, consisting of approximately $2M in costs related to employee transition, severance payments, employee benefits, and related costs, and approximately $2.4M in exit costs associated with the office space reductions. In connection with the restructuring plan, the company expects to incur approximately $17M in pre-tax charges in 2023, consisting of approximately $9M substantially related to employee transition, severance payments, employee benefits, and related costs expected to be realized in the first quarter of 2023, and approximately $8M of exit costs associated with office space reductions expected to occur by the second quarter of 2023. Of the aggregate amount of pre-tax charges that the company estimates it will incur in 2023, approximately $10M are expected to result in future cash expenditures related to the workforce reductions. In addition to these charges, the company expects a reduction in stock-based compensation of approximately $6M in the first quarter of 2023 associated with forfeited stock awards," the filing stated.