Amazon’s profits are soaring, but its payroll is shrinking. And AI plays a big role in it.
The company announced Tuesday that it will cut about 14,000 corporate jobs as part of a broader restructuring aimed at making the organization leaner and more efficient in the era of AI.
In a memo shared with employees and later published online, Beth Galetti, Amazon’s senior vice president of People Experience and Technology, said the changes were necessary to “strengthen our organizations by reducing layers, increasing ownership, and helping reduce bureaucracy.”
She noted that while Amazon continues to perform well, the company must adapt to the rapid technological shifts driven by AI.
“The world is changing quickly,” Galetti wrote. “This generation of AI is the most transformative technology we’ve seen since the Internet, and it’s enabling companies to innovate much faster than ever before.”
AI efficiency comes at a human cost
The layoffs, which primarily affect corporate workers, are part of CEO Andy Jassy’s ongoing effort to reshape Amazon into what he calls “the world’s largest startup.” Over the past two years, Jassy has streamlined management layers, cut costs, and doubled down on automation.
Jassy told employees earlier this year that “as we roll out more generative AI and agents, it should change the way our work is done.” He added, “We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs.”
In other words, Amazon’s expanding reliance on AI is not only transforming how the company operates but also reshaping its workforce, reducing some roles while creating others.
Amazon is not alone in this transition. Other major tech firms, including Microsoft, Meta, and Google, have all announced layoffs this year, citing similar reasons.
Microsoft has cut around 15,000 jobs, while Meta recently laid off 600 employees from its AI division. Amazon’s cuts could eventually eclipse 30,000 roles, making it the company’s largest workforce reduction since 2022, when it eliminated around 27,000 positions following a pandemic-era hiring surge.
For the roughly 14,000 employees affected, Amazon has promised transition support, including up to 90 days to find new roles internally, severance packages, and extended health benefits.
The timing of the announcement — just weeks before the holiday season — adds to the blow, leaving many employees facing uncertainty during a period typically marked by celebration and family gatherings.
Despite these reductions, Amazon’s stock has remained relatively stable following the news. Analysts expect the company’s long-term strategy to focus heavily on AI-driven innovation.
Galetti hinted that more cuts could come in the years ahead: “Looking ahead to 2026… we expect to continue hiring in key strategic areas while also finding additional places we can remove layers, increase ownership, and realize efficiency gains.”
In September, after slashing 4,000 jobs, Salesforce CEO Marc Benioff said the company “needs less heads” as it continues to lean more heavily into automation.
