Amazon reportedly plans to lay off as many as 10,000 employees in corporate and technology jobs starting as soon as this week, people familiar with the matter told The New York Times. The news follows a report in The Wall Street Journal last week that the ecommerce giant was undergoing a cost-cutting review to pare down unprofitable businesses.
The cuts will focus on Amazon’s devices businesses, including the teams involved with Alexa, as well as the retail division and human resources, the people told NYT. The number of layoffs remains fluid, but if it remains at 10,000 the move would represent approximately 3% of Amazon’s corporate workforce.
The potential focus on Alexa also was reported by WSJ, which noted that people familiar with the matter said that while the voice assistant was one of Jeff Bezos’ pet projects during his final years as CEO, current CEO Andy Jassy is putting greater emphasis on profitability. The Alexa business produced an operating loss of more than $5 billion in 2021, according to internal documents.
Amazon’s performance surged during the pandemic as ecommerce shopping reached new heights, which resulted in Amazon doubling its workforce over two years. However, shifting habits and economic uncertainty have led shoppers to cut back on purchases. This slowing growth has caused Amazon’s stock price to reach its lowest level since the early pandemic during the week of Nov. 7 — losing $1 trillion in value. Additionally, three people told NYT that during this time, Amazon executives held meetings with institutional investors.
The ecommerce giant has been fighting against the economic challenges by reducing investments in a number of initiatives, including its Amazon Care urgent and primary care service and Scout delivery bots. Amazon also has pulled back on its warehouse expansion plans and scaled back its number of workers by nearly 80,000 people between April and September 2022 through a combination of high attrition and reduced hiring. Corporate hiring was frozen in early November until at least early 2023.
Amazon isn’t alone among major tech companies cutting back both budgets and headcounts: Meta is laying off 10,000 employees, Google parent Alphabet has slowed the pace of its hiring and Elon Musk reduced Twitter’s head count by half after buying the company.