Amazon investors gave a positive reaction to the latest belt-tightening efforts, betting it may bolster profits at the e-commerce company. The shares climbed about 1.8% in trading before New York exchanges opened on Thursday. The Wall Street Journal first reported on the plan.
Eliminating 18,000 workers would be the biggest cut yet for tech companies during the current slowdown, but Amazon also has a far bigger workforce than Silicon Valley peers. It had more than 1.5 million employees as of the end of September.
At the time the company was planning its cuts in November, a spokesperson said Amazon had roughly 350,000 corporate employees worldwide.
The world’s largest online retailer spent the end of last year adjusting to a sharp slowdown in e-commerce growth as shoppers returned to pre-pandemic habits. Amazon delayed warehouse openings and halted hiring in its retail group. It broadened the freeze to the company’s corporate staff and then began making cuts.
Jassy has eliminated or curtailed experimental and unprofitable businesses, including teams working on a telehealth service, a delivery robot and a kids’ video-calling device, among other projects.
The Seattle-based company also is trying to align excess capacity with cooling demand. One effort includes trying to sell excess space on its cargo planes, according to people familiar with the matter.
Amazon, which began as an online bookstore, is seeing parts of its business level off. But it continues to invest in its cloud-computing and advertising businesses as well as video streaming.
The first wave of cuts landed heaviest on Amazon’s Devices and Services group, which builds the Alexa digital assistant and Echo smart speaker, among other products. The group’s chief told Bloomberg last month that layoffs in the unit totaled less than 2,000 people, and that Amazon remained committed to the voice assistant.