Amazon lays off 16,000 employees to prioritize growth areas – News

Amazon.com Inc. today announced a round of layoffs that will affect about 16,000 employees.

The restructuring comes a few weeks after the company let go 14,000 workers across multiple business units. Beth Galetti, Amazon’s senior vice president of people experience and technology, wrote in an internal memo that the job cuts are part of an effort “to strengthen our organization by reducing layers, increasing ownership, and removing bureaucracy.”

“Some of you might ask if this is the beginning of a new rhythm – where we announce broad reductions every few months. That’s not our plan,” Galetti added. “But just as we always have, every team will continue to evaluate the ownership, speed, and capacity to invent for customers, and make adjustments as appropriate.”

Amazon will give U.S. employees 90 days to search for another position internally. Workers who leave the company will receive severance pay, health insurance benefits and outplacement support. Amazon incurred about $1.8 billion in severance costs as part of its previous workforce reduction late last year.

The company didn’t specify what departments are impacted by the latest job cuts. Reuters reported that the restructuring affects multiple Amazon Web Services Inc. units along with teams focused on Prime Video, consumer devices, advertising and last-mile delivery. Several other units will reportedly see job cuts as well.

On Tuesday, Amazon announced plans to shutter 72 retail stores that operate under its Amazon Go and Amazon Fresh brands. A limited number of venues will reopen as Whole Foods locations. Amazon will also stop selling its Amazon One system, a palm print scanner that retailers can use to process payments in cashierless stores.

Galetti wrote in today’s memo about the layoffs that “while we’re making these changes, we’ll also continue hiring and investing in strategic areas and functions that are critical to our future.”

Those areas include AWS’ artificial intelligence infrastructure. Last year, the Amazon unit announced plans to build new cloud facilities in Indiana at a cost of $15 billion. The initiative, which is expected to create 1,100 jobs, will see the company add 2.5 gigawatts of data center capacity. AWS also plans to build nearly 1.3 gigawatts of AI and supercomputing infrastructure for the public sector as part of a separate project worth up to $50 billion.

Amazon is not the only tech giant to have announced job cuts this year. Meta Platforms Inc. earlier let go 10% of the employees at its Reality Labs unit, which develops virtual reality and augmented reality devices. Many of the affected workers were hardware engineers. The move is designed to make more resources available for Meta’s growing smart glasses business.

Last year, AWS rival Microsoft Corp. laid off 15,000 employees over several rounds of job cuts. Google LLC, in turn, reportedly let go several hundred employees from its cloud, Android and Pixel units. 

Photo: Amazon