Amazon has confirmed it plans to cut thousands of jobs, saying it needs to “organize more flexibly” to seize the opportunity presented by artificial intelligence.
The tech giant said on Tuesday that it would reduce its global corporate workforce by “about 14,000 jobs.”
Previous reports had indicated that it was planning to lay off up to 30,000 workers.
Beth Galletti, Senior Vice President at Amazon, he wrote in a memo to staff The move will make the company “stronger” by shifting resources “to ensure we invest in our biggest bets and what matters most to our customers’ current and future needs.”
She admitted that some may question the move given that the company is performing well.
At the end of July, Amazon announced second-quarter results that beat Wall Street expectations in several respects, including a 13% year-on-year increase in sales to $167.7 billion (£125 billion).
But Galletti said the cuts were necessary because AI was “the most transformative technology we have seen since the internet” and was “enabling companies to innovate much faster than ever before.”
“We are convinced that we need to organize more agilely, with fewer layers and more ownership, to move as quickly as possible for the benefit of our clients and our business,” she added.
The memo, which was shared with Amazon employees earlier Tuesday, said the company is “working diligently to support everyone whose role is affected” — including by helping those affected find new roles within Amazon.
She added that those who cannot receive “transitional support” including end-of-service benefits.
The BBC wondered whether this would affect staff in the UK.
The company employs more than 1.5 million employees in its warehouses and offices around the world.
This includes about 350,000 corporate employees, including those in executive, management and sales positions. According to the numbers Which Amazon provided to the US government last year.
Like many technology companies, Amazon has been hiring aggressively during the COVID-19 pandemic to meet the increase in demand for online deliveries and digital services.
Andy Jassy, Amazon’s president, has since focused on reducing spending as the company invests heavily in artificial intelligence tools to boost efficiency.
The increase in artificial intelligence tools, Mr. Jassy said in June It is likely to lead to job cuts Where machines take over routine tasks.
“We will need fewer people doing some of the jobs that are done today, and more people doing other types of jobs,” he said at the time.
Amazon has implemented several rounds of cuts in its corporate division in recent years.
It laid off about 27,000 workers over several months in 2022. As competitors were similarly looking to reverse hiring increases made during the pandemic.
After the company posted its latest financial results in July, its quieter earnings guidance for next quarter has left some doubt about whether or when its massive investments in artificial intelligence will pay off.
The slower growth of its cloud business, Amazon Web Services (AWS), compared to rivals Microsoft and Google, has also raised concern among some investors.
Amazon will report its latest results on Thursday for the period ending September 30.
The broader industry will be watching Amazon closely as it embarks on its latest round of cuts, said Ben Barringer, a technology analyst at Quilter Cheviot.
“We are already seeing job losses in software development thanks to the capabilities of some of these AI tools, and larger companies will look to redeploy and restructure their workforces accordingly,” he told the BBC.
“They have the data and can apply AI in a way that unfortunately means job losses are inevitable.”
Additional reporting by Philippa Wynn
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2025-10-28 12:37:00
