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Amazon has laid off some hardware unit employees as it targets 10,000 cuts

Amazon has laid off some hardware unit employees as it targets 10,000 cuts

November 16 (Reuters) – Amazon.com Inc (AMZN.O) The company said on Wednesday it had laid off some employees in its hardware group, with a person familiar with the company saying it was still targeting about 10,000 jobs, including in its retail and human resources divisions.

The announcement, the first for Amazon since media outlets including Reuters reported on its layoff plans Monday, heralded a dramatic turnaround for a company known for creating jobs and added shape to the latest layoffs to hit the tech sector.

Amazon CEO Dave Limp said in a blog post that the company decided to integrate the teams into its hardware unit, which has worked to deploy consumer-demand speakers through speech. And notified the staff that they made on Tuesday.

“We continue to face an unusual and uncertain macroeconomic environment,” he said. “In light of this, we have worked over the past few months to further prioritize what matters most to our customers and businesses.”

Plans, which are still in flux, to eliminate about 10,000 roles through cuts in more units would amount to about 3% of Amazon’s corporate workforce of approximately 300,000 people.

For years, the online retailer has been aiming to make Alexa, the voice assistant that powers the gadgets it sells, ubiquitous and serving any shopping request, though it wasn’t clear how far users would deploy it for tasks more complex than checking what they needed. news or weather. .

A project inspired by the talking computer in the sci-fi show Star Trek, Alexa has had a staff that has grown to 10,000 people by 2019.

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At the time, Amazon touted sales of more than 100 million Alexa devices, a number that hasn’t been publicly updated since. Founder Jeff Bezos later said that the company often sells Alexa devices at a discount, sometimes below cost.

While Amazon codes smart answers to any question Alexa might expect from users, Alphabet Inc (GOOGL.O) Google and Microsoft Corp (MSFT.O)OpenAI powered has made breakthroughs in chatbots that can respond like a human without any hands.

After news of the layoffs, shares pared losses and fell about 1% on Wednesday afternoon.

about the face

This news comes on the heels of Facebook subsidiary Meta Platforms Inc (META.O) The announcement last week of 11,000 job cuts, as well as layoffs at Twitter Inc, Microsoft and Snap Inc (SNAP.N) and others.

For Amazon, the cuts contrast sharply with efforts for months to double its base pay cap to compete more aggressively for talent.

In September last year, it marketed 55,000 corporate roles globally during a job fair, an increase dwarfed only by hiring for Amazon fulfillment centers. In short, the online bookseller that Bezos envisioned on a wild ride not 30 years ago has now become the second largest private employer in America, with more than 1.5 million workers including warehouse clerks.

The role was surprising. The retailer is now responding to sales that could rise 2% this holiday season, compared to an increase of 38% two years ago. Amazon’s chief financial officer told reporters last month that consumers have tighter budgets in the face of inflation and rising fuel costs.

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Likewise, the cloud computing division, a profit engine for the company, grew revenue more slowly quarter-over-quarter last year, when adjusted for foreign currencies.

Andy Jassy, ​​who ascended to CEO in 2021, has focused on cutting costs and halting Amazon’s 42% share price decline this year so far.

In his tenure, Amazon announced the end of its virtual healthcare service for employers and the trimming of its much-touted independent curbside delivery program. It also led to a gradual hiring freeze for companies as well.

Reporting by Jeffrey Dustin in Palo Alto, California and Aditya Soni in Bengaluru; Editing by Aaron Cower, Mark Porter, and Josie Kao

Our standards: Thomson Reuters Trust Principles.