Kenvue (NYSE:KVUE) has announced plans to lay off over 100 employees at one of its leading brands. Specifically, the prominent skincare, cosmetics and health company will be implementing job cuts at Neutrogena, a well-known name in the health and beauty space. The firm will let go 135 employees as part of the Kenvue layoffs.
The impacted group will primarily come from Neutrogena’s headquarters in Los Angeles, California, which is scheduled to close soon. That said, of the 84 workers whose jobs will be eliminated at that location, 74 will be offered positions at other divisions. Other popular Kenvue brands include Band-Aid, Aveeno and Tylenol.
Will the Kenvue Layoffs Impact KVUE Stock?
When job cuts are announced, it’s natural to wonder whether the company in question is in trouble. In the case of the Kenvue layoffs, though, so far everything seems to be okay. While KVUE stock has been fairly volatile this morning, shares are currently up about 0.5%. This suggests that the market isn’t reacting badly to the Neutrogena news, even if it indicates that Kenvue is restructuring.
As Seeking Alpha reports:
“Struggles within the Skin Health and Beauty segment have weighed on Kenvue […] as the company’s Q4 results showed shrinking profits and underperformance in commercial U.S. in-store execution. For the most recent quarter, the skin care business realized a 4.8% drop in volume with net sales down 8%.”
With that in mind, it makes sense that Kenvue is focused on making changes to trim operating costs and streamline its more profitable operations. The company is large and dynamic, with a wide portfolio of brands that encompass many different aspects of the healthcare field. As InvestorPlace contributor Josh Enomoto notes, this puts it in an excellent position to withstand difficult economic conditions. Even in tough times, demand for band-aids, mouthwash and allergy medication remains.
All told, the Kenvue layoffs clearly aren’t impacting KVUE stock in a big way and aren’t likely to in the future. Shares should continue to demonstrate resilience today.
On the date of publication, Samuel O’Brient did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
