The initial 500 positions were cut before the end of July, with another 500 to go before the end of 4th quarter of 2013, according to the company’s latest financial report.
The layoffs are designed to save general, administrative and indirect distribution costs from certain business units so that Medtronic can focus its attention in areas where it expects faster growth, such as in emerging markets and new therapies, the medical device company reported.
Medtronic expects the cuts to save $100-$125 million per year in savings, most of that coming from reduced compensation expenses.
The medtech giant 1st announced the cuts in May in conjunction with its 4th quarter and full-year earnings report, in which the company noted a continued decline in U.S. cardiac rhythm management and spinal products.
The layoffs included 200 from the device maker’s cardiac rhythm management division, but the remainder were not identified.
"We are eliminating about 1,000 positions around the company and around the globe," chief financial officer Gary Ellis said at the time. "It’s kind of the normal, ongoing thing that goes forward as we shift resources from slower-growing markets to faster-growing markets."
Medtronic has struggled with its heart business as the U.S. CRM market lagged for several quarters, but, despite a 5% sales slide during its latest quarter, the device giant said the slump seems to have stabilized.
Medtronic will add 1,500 new employees during fiscal year 2013, leaving a net increase in its workforce, Bloomberg News reported.
Medtronic’s workforce grew by about 4.7% from 2011 to 2012, according to data compiled by MassDevice.com.
Medtronic recorded a Q4 $118 million restructuring charge in connection with the ongoing layoffs, including $66 million in employee termination costs, $9 million in asset write-downs, $30 million in contract termination costs and $13 million in related expenses, according to the SEC filing.
MDT shares were up 1.7% to $41.53 as of about 1:30 p.m. today.