By Greg Bensinger and Deborah Mary Sophia (Reuters) – Amazon said on Tuesday it will reduce its global corporate workforce by about 14,000 people, with more cuts expected next year, in a major shakeup driven in part by adoption of artificial intelligence at the tech giant. The online retailer began laying off employees across multiple divisions as part of a plan, first reported on Monday by Reuters, to cut as many as 30,000 employees. The company has not confirmed the broader layoff plan, but in a companywide email indicated further cuts were planned. Amazon is working to compensate for over-hiring during the peak demand of the pandemic and to limit costs as it enters its crucial holiday selling season. The layoffs offer an early look at the possibly broad effects of AI on workforces. Amazon CEO Andy Jassy flagged the potential for such losses in June, saying increased use of AI tools and agents would lead to more corporate job cuts, particularly through automating routine tasks. Amazon had about 1.56 million full-time and part-time employees at the end of last year. Its corporate workforce includes roughly 350,000 employees. Workers told Reuters they learned their jobs were eliminated from letters sent to their personal email addresses early on Tuesday morning. "You are no longer required to perform work on Amazon's behalf," reads the email from Beth Galetti, senior vice president of People Experience and Technology, which was sent to impacted employees and seen by Reuters. She said those workers would be given the option to meet with a human resources employee via video call. "Unfortunately, your role is being eliminated and your employment will end after a non-working period." Amazon will offer most affected workers 90 days to look for a new role internally and said its recruiting teams would prioritize those candidates. Jassy is undertaking an initiative to reduce what he has described as a surfeit of bureaucracy, including by reducing the number of managers. He spun up an anonymous complaint line for identifying inefficiencies that has elicited some 1,500 responses and over 450 process changes. This week's move represents the deepest job cuts since 27,000 jobs were eliminated in late 2022 and early 2023. Departments affected on Tuesday include devices, advertising, Prime Video, HR, operations, Alexa and Amazon's cloud computing unit Amazon Web Services (AWS), employees told Reuters. The full scope of departments affected could not be learned and when contacted for clarification, Amazon redirected Reuters to the post on its website. It was not immediately clear over what period the full extent of job cuts will take place, but Galetti said in the note that Amazon would continue hiring in certain areas and reducing headcount in other divisions heading into 2026. Over the past two years, the company has been carrying out piecemeal job cuts across divisions including books, devices and its Wondery podcast business. The layoffs so far have already helped teams move faster, Galetti said. Shares of the Seattle-based company were up 0.8% at midday on Tuesday. The stock has risen about 3.5% this year, making it the worst performer among the "Magnificent 7" group of megacap tech stocks. AI EFFORTS Galetti's note reiterated CEO Jassy's push to reduce management layers and lean more on AI. Corporations are increasingly using the technology to write code for their software and adopting AI agents to automate routine tasks, as they look to save costs and cut reliance on people. "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," Galetti said. Amazon is expected to shell out roughly $118 billion in capital expenditures for the year, with much of it going toward building AI and cloud infrastructure. The company will report third-quarter earnings on Thursday. Separately, U.S. Senator Bernie Sanders on Tuesday called on Amazon founder Jeff Bezos to account for what he said were hundreds of thousands of potential lost jobs due to automation. Sanders was referring to a New York Times article published earlier this month that reported Amazon executives believe 500,000 jobs could be cut over time by replacing warehouse workers with robots. Two U.S. senators have also asked Amazon to explain why it is the nation's largest employer of foreign workers using H-1B visas while also cutting jobs. (Reporting by Greg Bensinger in San Francisco and Deborah Sophia and Harshita Mary Varghese in Bengaluru; Editing by Devika Syamnath and Matthew Lewis)
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