Alphabet's Verily Shuts Down Medical Device Program, Shifts Focus to AI

Verily is closing its medical device program as Alphabet shifts more resources to AI | TechCrunch

Alphabet's life sciences arm Verily laid off staff and eliminated its entire devices program Monday. CEO Stephen Gillett announced the "difficult decision" to wind down the program in a staff memo, according to Business Insider. "Over the years, Verily has built a legacy in developing world-class, innovative medical devices," Gillett wrote, noting that the "path forward requires difficult decisions" as Verily refocuses on AI and data infrastructure. The move continues Alphabet's aggressive efforts to invest in AI while cutting costs elsewhere. The company has conducted multiple rounds of layoffs in recent years, including cuts to its HR and cloud units in February and voluntary exit programs for its more than 25,000 Platforms & Devices employees in spring. Alphabet's biggest recent layoffs came in January 2023, when it slashed 12,000 jobs -- 6% of its workforce at the time -- in anticipation of an economic slowdown. That same month, ChatGPT became the fastest-growing consumer software application in history, gaining over 100 million users in two months and kicking off the generative AI boom that today drives the tech industry's priorities.

Alphabet's Verily closes its medical device division and lays off staff

Alphabet's Verily was one of the company's star "moonshot" businesses, with its research delving into areas ranging from connected diabetes therapies to robot surgery. Now, Verily has shuttered its medical device division and laid off staff, the company announced in a memo seen by Business Insider. The number of employees who lost their jobs was not revealed. "We have made the difficult decision to discontinue manufacturing medical devices and will no longer be supporting them going forward," a spokesperson told BI. The cuts are a continuation of Alphabet's 2023 strategic shift that saw the company cut 12,000 positions across multiple divisions while putting more resources toward AI and data infrastructure. CEO Stephen Gillett highlighted some of Verily's achievements, "from the launch of the Dexcom G7 CGM [a diabetes management system], to the Stargazer VNRC launch [a drug targeting system] launch with 7,800 patients screened... and these contributions have advanced patient care and medial research." The medical devices division may not have been a profit maker for Alphabet, but it certainly provided research in a critical area. Verily will now focus on its "core mission," Gillett said, namely "precision health, data and AI."

Alphabet's Verily shuts medical device programme, cuts staff

Layoffs a result of cost management and refocusing towards 'most critical priorities', CEO told staff. Alphabet's life sciences company Verily is laying off staff and shutting down its entire devices program. The exact number of staff affected in this move is unclear. The news was first reported by Business Insider which obtained the memo sent to staff announcing the decision. In it, CEO Stephen Gillet said that the move was a result of "ongoing efforts to manage costs and ensure resources are allocated to...[their] most critical priorities". "As Verily has continued on its journey of narrowing product focus around our precision health platform and data and AI strategy, we cannot support the investment of the resources necessary for the long-term growth and scaling of our devices programs, and have therefore made the difficult decision to fully wind down the program," Gillet wrote. A "significant" part of the workforce reductions come as a result of the program being shut down, he said. Verily began as a moonshot inside Google's X lab in 2015 and develops tech-driven healthcare solutions. The company has been cutting costs and streamlining projects while refocusing its strategy around AI for a while, reports suggest. While still owned by Alphabet, company leaders told staff that the efforts are important to one day cut ties with Google and become a fully independent company, Business Insider previously reported. Employees have told the news publication that some staff benefits have also been cut in recent months. Earlier this year, Verily sold its insurance business Granular Insurance Company, which was launched in 2020, to Elevance Health. Google has laid off staff in a number of instances over the past few years, including in its HR and cloud units this February, while announcing buyouts for its Platforms and Devices unit which staffs more than 25,000 full-time employees who work on Android, Chrome, ChromeOS, Google Photos, Google One, Pixel, Fitbit and Nest. In 2023, the company laid off 12,000 jobs. Don't miss out on the knowledge you need to succeed. Sign up for the Daily Brief, Silicon Republic's digest of need-to-know sci-tech news.