Though business has been booming, Amazon said on Wednesday that it was laying off 16,000 more corporate employees as it looked to trim bureaucracy and free up money for plans to spend heavily on artificial intelligence.
The cuts were widely expected across Amazon’s corporate work force since late October, when the company laid off 14,000 corporate employees. At the time, The New York Times and other publications reported that another round of layoffs was planned for January, after the holiday shopping season.
The company did not rule out more job cuts in the future, although it said it was not planning to create a “new rhythm” of layoffs every few months.
“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,” Beth Galetti, Amazon’s senior vice president of people experience and technology, said in a blog post. “That’s never been more important than it is today in a world that’s changing faster than ever.”
Next week, Amazon is scheduled to report its financial results for the fourth quarter, which covered the holiday shopping season. Wall Street analysts expect that sales surpassed $211 billion and that profits were more than $21 billion.
In the previous quarter, July through September, the company’s sales totaled $180 billion, and profit topped $21 billion.
The pattern echoed a large round of layoffs in late 2022 and early 2023, when the company eliminated almost 30,000 positions to trim costs as the world emerged from the pandemic.
The October layoffs ran the gamut. In Amazon’s home state, Washington, about 2,000 employees lost their jobs, including recruiters, analysts and managers. The hardest-hit job category was software engineers. More than 1,500 positions were cut in California.
Last summer, Andy Jassy, Amazon’s chief executive, told employees that artificial intelligence meant that, over time, the company would operate with fewer corporate workers. But in the fall, he told investors that the layoffs had less to do with A.I. or finances and more with reducing layers of bureaucracy. Still, the reductions in various divisions were based on targets for trimming operating costs.
Amazon had 1,578,000 employees in the third quarter. Most of those were hourly workers in its warehouses and operations not directly affected by the new cuts. But the company has been looking to reduce its work force there as well, with ambitious plans to replace more than half a million jobs with robots, The Times reported last year.
Amazon has been cutting costs across its businesses in part to plow money into building data centers to compete in the race to dominate artificial intelligence. It was on the path to spend $125 billion last year on new data centers and other capital expenditures.
As part of its plans to prioritize investments, on Tuesday Amazon said it was closing down its cashierless Amazon Go convenience stores and Amazon Fresh grocery stores. Amazon had pulled back on Amazon Go stores several years ago, and has revamped its grocery strategy several times.
Its website showed the company had 14 Amazon Go stores, including sites near its Seattle headquarters and in New York. It also showed about 50 Amazon Fresh stores, with about half in California, and said some would convert to Whole Foods Market locations. Amazon said it was investing in super fast online delivery of fresh groceries, and planned to add 100 Whole Foods locations “over the next few years.”
On Tuesday, UPS said it expected to cut as many as 30,000 jobs this year because it expected to deliver fewer packages for Amazon.
Adam Satariano contributed reporting.
Karen Weise writes about technology for The Times and is based in Seattle. Her coverage focuses on Amazon and Microsoft, two of the most powerful companies in America.
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