Amazon’s cuts are likely to focus on the company’s devices business (which includes numerous Alexa-powered products), human resources, and its retail unit. In a reminder of just how massive Amazon has grown, the Times says 10,000 workers would represent 3 percent of the company’s corporate ranks and 1 percent of its overall workforce.
There have been recent indications that Amazon might be rethinking where Alexa and first-party devices fit into its priorities. At the very least, CEO Andy Jassy seems determined to sink less money into them. “We’re as optimistic about Alexa’s future today as we’ve ever been, and it remains an important business and area of investment for Amazon,” Amazon spokesperson Brad Glasser told The Verge last week in response to a report from The Wall Street Journal that said the company is “weighing changes” in the devices business. The unit has recorded operating losses of $5 billion in some recent years.
A projected downturn for the US economy has led tech giants to significantly slow their pace of hiring or freeze it altogether. Similar to Meta, Amazon saw record momentum during the early phase of the covid pandemic and overinvested based on those record profits. At the beginning of November, Amazon said it would “pause on new incremental hires in our corporate workforce.” As the Times notes, the company just doubled its salary cap for corporate employees earlier this year.
Some companies have come to realize after the fact that their cuts extended too deep; Twitter has reportedly asked some corporate workers to return after a high-profile firing spree that eliminated half the company. But it continues to slash employees elsewhere, most recently cutting thousands of contractors without warning.
Amazon’s layoffs are likely to be more calculated and won’t necessarily be felt in the company’s upcoming product pipeline but will still put thousands of people in a precarious spot as the global economic slump continues. Should the 10,000 figure prove accurate, it would mark the largest cuts in Amazon’s history.