Recently, there have been reports that Johnson&Johnson China has laid off multiple product lines, with compensation plans ranging from "N+1", "N+2", and "N+3". An employee of Johnson&Johnson China who was laid off stated to a reporter from Nanduwan Financial News Agency that the scale of the layoffs is 20%, mainly involving the surgical department. The layoffs were privately sent via email, and she signed a resignation date at the end of this year. In recent years, Johnson&Johnson has successively optimized its personnel, but this time it involves structural adjustments, which have a wider impact. "The compensation is good, divided by years, at most N+3".
On November 14th, a reporter from Nanduwan Caishe contacted Johnson&Johnson China through official email channels, but did not receive a response as of press time. On the same day, the reporter called Johnson&Johnson China, but did not receive a clear response.
Johnson&Johnson Group has been hit with multiple layoffs since 2023
In the third quarter of this year, there was a slight increase in revenue in the Asia Pacific and Africa regions, with no increase in profits
J&J Group originally owned products covering personal care, healthcare, and other businesses such as Big Treasure, Johnson&Johnson Baby, Neutrogena, Tylenol, Bondi, Dr. Uno, and Listerine. However, since the group split its consumer health business in 2021, it has focused on two major businesses: MedTech and Innovative Medicine. The consumer health business has become an independent company, Kenvue, and will be listed on the New York Stock Exchange in 2023.
Source: Johnson&Johnson official website
Public information shows that Johnson&Johnson has been exposed to multiple layoffs since 2023, involving business mergers, closure of its cardiovascular and metabolic departments in its pharmaceutical division, and layoffs of employees at its subsidiary's factories in the United States. However, in public reports, Johnson&Johnson did not publicly respond to this.
The reporter from Nanduwan Caishe noticed that there have been recent reports that Johnson&Johnson China has made organizational adjustments to its surgical division. The aforementioned interviewed employee stated to a reporter from Nanduwan Financial News Agency that this matter is indeed true. The reporter contacted Johnson&Johnson China on November 14th for verification, but did not receive a response as of the time of publication. According to reports, starting from January 1, 2025, the Surgery Division will be reorganized into six major departments: Minimally Invasive and Energy Surgery Division, Wound Closure Division, Biosurgery Division, Surgical Product Expansion Division (i.e. Wide Area Market Division), Strategic Marketing Division, and Robotics and Digitalization Division.
According to the third quarter report released by Johnson&Johnson on October 15th, the company's sales increased by 5.2% year-on-year to $22.471 billion in the third quarter of this year, while net profit decreased by 37.5% year-on-year to $2.694 billion. Under non GAAP accounting standards, adjusted net profit decreased by 13.3% year-on-year to $5.876 billion.
From a departmental perspective, in the third quarter, revenue from innovative drugs increased by 6.4% year-on-year to $14.58 billion, while revenue from medical technology increased by 3.7% year-on-year to $7.891 billion. According to the official website of Johnson&Johnson China, its innovative pharmaceutical products cover areas such as blood, immunity, solid tumors, infectious diseases, etc. Its medical technology is used for medical equipment in minimally invasive and open surgery, electrophysiology, orthopedics, plastic surgery, and infection prevention.
By region, the United States is Johnson&Johnson's main source of revenue, accounting for approximately 57%, while the Asia Pacific non region saw a slight increase in revenue of 0.5% year-on-year to $3.475 billion in the third quarter, accounting for approximately 15.5% of revenue.
According to the official website of Johnson&Johnson China, at this year's CIIE, Cherry Huang, President of Johnson&Johnson Innovative Pharmaceuticals China, expressed her hope to continue to work together with all parties in the industry to serve the health needs of more Chinese people and contribute to China's medical and health industry. Zhou Mintao, President of Johnson&Johnson Medical Technology in China, stated that it will promote the faster landing of numerous innovative exhibits in China and push domestically produced "Made in China" innovative products to the global market.
After the new consumer goods company goes public, it also slimmes down
The CEO said that next year's focus will be on the EMEA region and the Chinese market, which may be experiencing setbacks?
Kedao, which successfully went public after leaving Johnson&Johnson, has also started layoffs this year. According to previous reports from Southern Metropolis Daily, on May 7th US time, Keda announced in its quarterly report that the company's board of directors has approved a measure to lay off 4% of its workforce globally, aiming to improve organizational efficiency and better position Keda for future growth. According to official data disclosed by Keda, Keda has a total of 22000 employees. Based on this rough estimate, the layoffs are expected to affect 880 employees.
Tu Yuan Ke went to the official
Koto's products are more geared towards the C-end than those of New Johnson&Johnson. However, according to its third quarter report released on November 7th, the revenue of its skin health and beauty sector also declined year-on-year. This sector is also the only sector where Koto's revenue declined in the first three quarters, including products such as Dabao, Neutrogena, Avino, and Dr. Uno.
Overall, in the first three quarters of the year ended September 29th, the net sales of Ke increased slightly by 0.13% year-on-year to $11.793 billion, net profit decreased by 44.88% year-on-year to $773 million, adjusted EBITDA increased by 2.03% year-on-year to $2.868 billion, and adjusted gross profit margin increased from 58.0% in the same period last year to 60.9%.
Tuyuan Dabao Official Account
Ke Xiang seems to be "disappointed" in the Chinese market. In an earlier semi annual report conference call, CEO Thibaut Mongon stated that most of Keda's business in China is self-care, especially in areas such as allergies, pain relief, antifungal treatment, pediatrics, etc. However, in the skin care and beauty sectors, consumers will be more cautious.
During the third quarter earnings conference call, Thibaut Mongon stated that it is well known that the consumer market in China is still full of challenges. He said, "I don't think we can expect the emotions of Asian consumers to improve, so for us, the real focus in 2025 is to promote expansion in the EMEA region, which has performed well.
Paul Ruh, Chief Financial Officer of Keda, said that in the third quarter of last year, the company began to feel the resistance of Chinese consumers towards Japanese brands, so the company is also responding. "This is not an important factor affecting the third quarter, and it will not be a factor affecting the fourth quarter either. The reporter from Nanduwan Financial News Agency noticed that the two executives from Keda pointed out that the affected brands were Keda's Japanese brand, Dr. Chengno.
Does this mean that Ke has failed in the Chinese market? What are the company's plans for the Chinese market going forward? The reporter from Nanduwan Caishe sent an interview email to the IR and Media Liaison Office of the headquarters on November 10th, but did not receive a response as of the time of publication.
