Chief Executive Andy Jassy said in a statement that the company had added a significant number of employees in recent years, which he defended as a necessary step given what was happening with Amazon’s business at the time.
“Given the uncertain economy we live in and the uncertainty of the future, we have chosen to be more streamlined in our costs and headcount,” said Mr. The layoffs come after Amazon’s anniversary, Jassi said. Planning process.
The company previously said it would cut 18,000 positions.
Waves of job cuts have rocked the tech industry. Amazon has implemented more job cuts than previously expected. Last week, Facebook parented meta platforms Inc.
It said it would cut about 10,000 jobs in the coming months, its second wave of mass layoffs.
As people shifted their shopping online during the early stages of the Covid-19 pandemic, Amazon invested heavily in expanding its headcount. The company added about 800,000 employees, mostly at its hundreds of warehouses, between the end of 2019 and the end of 2021. When demand began to decline as consumers returned to brick-and-mortar stores, Amazon cut parts of the business. Unprofitable and hiring freezes.
Mr. Jassi said the 9,000 additional job cuts were not announced earlier because some teams had not completed assessments to determine which positions to eliminate. The cuts will be completed by mid-to-late April, he said. Amazon had about 1.5 million employees worldwide at the end of December. The company employed about 350,000 corporate workers before its recent layoffs.
Layoffs.fyi, a site that tracks job cuts in the industry, says layoffs at tech companies will reach about 300,000 workers through 2022.
Amazon is going through one of the toughest stretches in its history. The company recently laid off 18,000 corporate employees, or about 5% of its total. Those cuts were concentrated in its devices business and recruiting and retail operations.
In addition to the announced job cuts, Amazon has made other changes that could lead to more voluntary turnover than in recent years. The company has not adjusted its stock-heavy compensation plans, meaning many employees will effectively take a pay cut this year, according to The Wall Street Journal. Amazon recently announced plans to return to the office starting next month, which didn’t go down well with some employees.
According to Rick Willers, an analyst at ITC, the job cuts for Amazon’s cloud-computing unit come as cloud customers want to save money on infrastructure and software costs. At the same time, new growth opportunities for cloud companies, such as artificial intelligence, have yet to make a significant impact, he said.
“Amazon is one of the biggest players in the cloud arena, and that shows in their numbers,” Mr. Willers said. Cloud spending in the U.S. grew 27% in the fourth quarter, lower than the 31% average growth rate of the previous four quarters, according to market analysis firm Synergy Research Group.
Amazon’s chief financial officer, Brian Olszewski, said that month that the company saw a continued slowdown in AWS spending as customers reined in spending. Amazon’s advertising business, which has become an increasingly meaningful sales driver, saw a slowdown in the fourth quarter, posting a 19% increase in sales. AWS, Mr. Olsavsky said there will be challenges “for at least the next two quarters.”
AWS reported $22.8 billion in operating income last year. Other companies also had a combined operating loss of $10.6 billion.
Amazon has also scaled back projects and scaled back investments in some areas. Earlier this month, it confirmed it was suspending construction on a large corporate real estate complex near Washington, D.C., that it is calling its second headquarters, or HQ2. With the first phase of its project nearly complete, Amazon originally planned to break ground on the second phase of the project, which would include three 22-story office buildings, in the first quarter of 2023.
The same day it revealed its plans for HQ2, it also said it would close eight of its cashless Amazon Go stores across Seattle, New York City and San Francisco on April 1. The closures add to Amazon’s other struggles in physical retail. Including closing its physical bookstores in 2022. The company has canceled some programs in recent months, such as its AmazonSmile charity program.
Amazon grew rapidly during the pandemic, boosted by huge demand for its e-commerce services. But like many of its tech peers, it has struggled with growth lately. The company warned in February that it could have slower growth, including in its profitable AWS business, which saw its slowest growth rate in the fourth quarter since Amazon began disaggregating the division’s performance in revenue.
—Dana Mattioli contributed to this article.
Write to Sebastian Herrera at [email protected] and Joseph de Avila at [email protected]
Corrections & Amplifications
Amazon has about 350,000 corporate employees. An earlier version of this article incorrectly stated that the company had 35,000 employees in its corporate ranks. (Corrected on March 20)
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