In a much-anticipated move, Natick, MA’s Boston Scientific Corporation (NYSE: BSX) announced after the market closed today that it will cut some 2,300 jobs.
The move, which will begin this month and should be largely completed by the end of next year, is part of the company’s effort to cut its operating expenses by about half a billion dollars in 2008 and by another $25 million to $50 million in 2009; the company’s 2007 expenses are about $4.1 billion. In addition to the staff cuts announced today, the company expects that some 2,000 employees will leave Boston Scientific as it completes already announced business divestitures. The company also plans to restructure several of its businesses in order to “leverage resources, strengthen competitive positions, and create a more simplified and efficient business model.”
In the face of weak sales of its defibrillator and stent products, as well as a host of regulatory and legal snarls, Boston Scientific has been hinting for months that cuts were coming. In a great story from yesterday’s Boston Globe, Todd Wallack lays out the various pressures coming to bear on Boston Scientific, whose stock has fallen some 40 percent since the beginning of 2006. The cuts announced today fit with the predictions of the analysts quoted in the piece, who foresaw the elimination of some 2,000 to 3,400 jobs. (If you see wildly different estimates of the percentage of Boston Scientific’s workforce represented by the 2,300 jobs whose elimination was announced today, it’s because many media outlets peg the company’s overall size at 28,000 employees, whereas the company in its announcement puts it at 18,000—I’m pretty sure it’s a typo on Boston Scientific’s part and will update if and when I get any clarification on that.)
