Noom confirmed it had conducted another workforce reduction, marking the third round of layoffs at the digital weight loss company in less than a year.
The company didn’t specify how many employees were affected by the latest job cuts. In April, Insider reported that Noom was laying off about a quarter of its coaches. It conducted another round of cuts in the fall, with TechCrunch reporting it was laying off around 500 workers, or about 10% of its staff.
In a statement to MobiHealthNews, a Noom spokesperson said the company had experienced “extraordinary growth” during the past several years, and it was working to ensure it could maintain its momentum long-term.
“As a result of the tough economic headwinds that are impacting businesses across industries, we have made the difficult decision to reduce the number of Noom employees,” the spokesperson said in a statement. “While this was a painful choice, we are confident in our strategy and in our ability to continue to serve Noomers as they work to better their lives through behavior change.”
THE LARGER TREND
Founded in 2008, Noom last raised $540 million in Series F funding in 2021. Following the raise, Bloomberg reported the weight loss company was valued at $3.7 billion. It launched a behavioral health product not long after it announced its massive Series F, and it revealed an enterprise offering for employers late last year.
In 2022, Noom settled a lawsuit that alleged it had misled users into signing up for subscriptions that were difficult to cancel. In October, Bloomberg reported Noom had begun searching for a new CEO to replace cofounder Saeju Jeong, who will become executive chairman when a successor is named. The company’s CFO, Michael Noonan, left the company in the fall to join Tripadvisor, while Noom’s general counsel recently posted on LinkedIn that she had stepped down from her role.
A number of digital health companies have announced layoffs since the summer. Health data analytics startup Innovaccer, another digital health unicorn, recently laid off about 15% of its workforce. Virtual care giant Teladoc Health and prescription digital therapeutics company Akili Interactive have also recently announced layoffs.