Amazon starts cutting jobs, with layoffs hitting Alexa unit and cloud gaming division
KEY POINTS
- Amazon has begun laying off employees in its corporate and tech workforce.
- CEO Andy Jassy has moved aggressively to cut costs across Amazon, and the company previously said it would freeze hiring in its corporate workforce.
Amazon on Tuesday began laying off employees in its corporate and tech workforce as CEO Andy Jassy steps up efforts to rein in costs.
The company notified workers in several divisions, including Alexa and the Luna cloud gaming unit, that they were being let go, according to LinkedIn posts from Amazon employees who said they had been impacted.
Amazon is aiming to eliminate about 10,000 jobs, mostly in retail, devices and human resources, The New York Times reported Monday. The number remains fluid because the cuts are being implemented by individual teams, according to the Times.
By midday Tuesday, Amazon had not sent out any companywide communication about the planned layoffs, which sparked frustration among employees, according to a person familiar with the matter who asked not to be named because of confidentiality.
Representatives from Amazon declined to comment.
In recent weeks, Amazon also began laying off some contracted employees who worked in recruiting roles for its advertising, internal operations, and Fire TV divisions, according to people with knowledge of the cuts.
One employee, who asked to remain anonymous, said Amazon informed her earlier this month that it wouldn’t be renewing her contract. Last month, she was in talks to pursue a full-time role in Amazon’s consumer division, but her interview was abruptly canceled due to ongoing restructuring, she was told.
Jassy has aggressively curtailed expenses across the company in recent months as it stares down a weakening economy and slowing growth in its retail business. Previously, the company said it would pause hiring among its corporate workforce, and it has halted some experimental projects, as well as opted to close, delay or cancel new warehouse locations.
Until now, it had managed to avoid mass layoffs by offering employees impacted by project closures the opportunity to transfer to other divisions within the company.
The job cuts represent a stark reversal for Amazon, which less than a year ago couldn’t find enough workers to keep its warehouses staffed in a hot labor market and was still in the midst of a pandemic-fueled hiring spree. It nearly doubled its workforce between the end of 2019 and the end of 2021 from 798,000 employees globally to 1.6 million.
Since then, it has moved to slow headcount growth as consumers have returned to physical stores, and its retail business is no longer growing at a rapid clip as it has in recent years. Amazon CFO Brian Olsavsky last month said the company is seeing signs consumers are feeling the sting of inflation.
“We are preparing for what could be a slower growth period,” Olsavsky said on a call with reporters following the company’s third-quarter earnings results, which included weaker-than-expected guidance for the current period.
The company still plans to bring on 150,000 employees for the holiday shopping period, the same number of workers it said it would add last year.
Job cuts are hitting the tech sector hard after years of unbridled growth. Facebook parent Meta last week laid off 13% of its staff, while Twitter, Shopify, Salesforce and Stripe have also announced cuts.
The expected layoffs would represent the biggest cut in the company’s 28-year history. In 2001, Amazon slashed 1,300 jobs, or 15% of its workforce, after the dot-com bubble burst.
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