Zimmer Biomet (NYSE:ZBH) has more R&D employees following the ZimVie spinoff but fewer total employees, including manufacturing employees and employees in the U.S.
Warsaw, Indiana-based Zimmer Biomet spun its spine and dental business off as ZimVie (Nasdaq:ZIMV) in March 2022. Westminster, Colorado-based ZimVie said in its first-ever annual report this month that it has approximately 2,700 employees, including about 1,400 in the U.S.
Before the spinoff, Zimmer Biomet reported employing approximately 19,500 people at the end of 2021. This month, the orthopedics developer and manufacturer said it had 18,000 employees at the end of 2022.
That 1,500 decrease equals an 8% change year over year. But it’s a smaller drop in headcount than might have been expected from the spinoff. And through the change, the company increased its R&D team by 5% to 2,100 people.
Zimmer Biomet exceeded analysts’ expectations in its most recent quarter but warned of continued macroeconomic pressure. UBS Research this week issued a sell rating on the stock, saying the company “is a consistent low-single-digit sales growth company for the foreseeable future” and unlikely to hit its 4% revenue growth target.
Investors are watching Zimmer Biomet after an unusually slim majority of shareholders voted in support of its executive pay package last year. The company has not yet disclosed its 2022 executive compensation totals.
Zimmer Biomet CEO Bryan Hanson and other leaders have promised to forge through industry headwinds with digital technology innovations and strategic acquisitions.
Zimmer Biomet’s employee breakdown
Here’s how Zimmer Biomet’s employee counts changed from the end of 2021 to the end of 2022, according to its annual reports:
- Total employees: 19,500 to 18,000, an 8% decrease
- U.S. employees: 9,000 (47% of total employees) to 8,000 (44 percent of total employees), an 11% decrease
- Employees outside the U.S.: 10,500 to 10,000, a 5% decrease
- Employees dedicated to manufacturing (worldwide): 8,000 to 7,600, a 5% decrease
- Employees dedicated to R&D (worldwide): 2,000 to 2,100, a 5% increase
Zimmer Biomet has conducted two major cost-cutting reorganization efforts in recent years “to further invest in higher priority growth opportunities,” starting the first in December 2019 and another in 2021.
The company had around 19,900 employees at the end of 2019, including 2,100 R&D employees, 8,600 manufacturing employees and 9,500 employees in the U.S.
Employee termination benefits and other restructuring costs totaled $116.9 million in 2020, $125.7 million in 2021 and $191.6 million in 2022.
In 2019, Zimmer Biomet’s primary production facilities in Warsaw employed about 3,100 people, but the company did not disclose that figure in subsequent annual reports.
At the end of 2022, Zimmer Biomet owned or leased approximately 280 facilities worldwide, about half of which are in the U.S.
The company has 25 manufacturing sites worldwide, including in Switzerland (the EMEA headquarters), Ireland, the U.K., China and Puerto Rico. The Asia Pacific headquarters is in Singapore.
The main R&D facility is in Warsaw, but other R&D personnel are based elsewhere in the U.S, Canada, China, France and Switzerland.
“We have extensive research and development activities to develop new surgical techniques, including robotic techniques, materials, biologics and product designs,” the company said in its latest annual report. “… The rapid commercialization of innovative new materials, biologics products, implant and instrument designs and surgical techniques remains one of our core strategies and continues to be an important driver of sales growth.”
Employee diversity at Zimmer Biomet
Zimmer Biomet also reports diversity figures. About 35% of its global employees are women, including 25% of director positions and higher. Those figures did not change from 2021.
About 23% of its U.S. employees are “people of color,” up from 22% at the end of 2021. People of color held 15% of its U.S. director positions and higher at the end of 2022, unchanged from the year before.
The company said it has “established 2026 representation goals for women and POC in the organization, guided by internal and external benchmarks,” but did not include those targets in its annual reports or its most recent sustainability report.
Zimmer Biomet SVP and Chief Communications and Administration Officer Keri Mattox took on new environmental, social and governance (ESG) responsibilities last year.
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