Amazon’s sales soared 17% in the recently completed first quarter, to $29.27 billion, the company announced last week. This growth is a sharp deceleration from the last period’s 18.9% surge. The company later confirmed it is laying off staff in its second largest division — cloud computing. This decision likely foreshadows a continued shrinking of the net corporate headcount overall.
The layoffs follow great difficulties for Amazon Web Services (AWS), which is the company’s branch of cloud computing. In May, AWS announced its third quarter in a row of revenue misses. What really got Amazon thinking about its org chart and headcount requirements. While the review is ongoing, Amazon has agreed to cut all the positions announced in AWS on account of this historic review.
Brad Glasser, an Amazon spokesperson, stated, “After a thorough review of our organization, our priorities, and what we need to focus on going forward, we’ve made the difficult business decision to eliminate some roles across particular teams in AWS.” These layoffs are part of a broader trend within the company as it adapts to changing market demands and technological advancements.
In addition to all that, Amazon’s CEO, Andy Jassy, announced last month that Amazon is expecting to shrink its corporate workforce even more. He noted that generative AI will most assuredly lower headcount in a number of current positions. It will drive the need to hire people with new skill sets. Jassy remarked, “We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs.”
While Amazon is certainly adjusting to these changes, that company’s leadership clearly believes they need to keep tightening their workforce belt to fuel other future growth. Generative AI, along with other cutting-edge technologies, will drive work in remarkable new ways and create seismic movements between departments and disciplines.