E-commerce and cloud computing giant Amazon announced on Tuesday that it will cut 14000 jobs to streamline operations, while continuing to invest heavily in artificial intelligence (AI). So, what should you know about it?
An effort to remove redundancy
In its statement, Amazon said the move was part of an ongoing effort to "reduce bureaucracy, eliminate redundant layers of management, and focus resources on key investment areas and the needs of current and future customers."
"While this involves layoffs in some areas and hiring in others, it will lead to an overall reduction of approximately 14000 corporate positions," Amazon Senior Vice President Beth Galetti said in the statement.
Galetti described AI as the most transformative technology since the advent of the Internet, adding that it allows companies to “innovate faster than ever before.”
US media earlier on Monday reported that massive layoffs were being planned, with the total worldwide expected to reach 30000 jobs in the coming months.
The report stated that the cuts would affect human resources, advertising and management departments, in a group that has 350000 office workers out of more than 1.5 million employees overall.
However, warehouse and distribution centre workers who make up the majority of Amazon's workforce are not expected to be affected, Galetti said, explaining that this layoff is just a first step.
CEO says AI will change the way companies work now
“Towards 2026, we expect to continue to hire in key strategic areas, while finding more space to eliminate layers of management, improve efficiency and strengthen internal ownership,” he added.
Amazon CEO Andy Jassy has previously stressed that AI will transform the way companies operate, from customer service to office efficiency.
“Our belief that AI will transform every customer experience is now becoming clearer,” he said in the company's recent quarterly financial report.
Amazon is expected to announce its latest earnings report this Thursday, amid huge pressure on the tech giant to prove the return on its investment in AI.
The company is also expected to answer questions about a major Amazon Web Services (AWS) outage last week that caused multiple global platforms, including Prime Video, Disney+, Fortnite, Airbnb, Snapchat, Signal, WhatsApp and several banks such as Lloyd, to be down for several hours.
The outage was caused by an issue with the Domain Name System (DNS) in Amazon's cloud network, highlighting how much the digital world depends on the company's infrastructure.
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