Amazon Slashes 14,000 Jobs as It Leans Into Generative AI

Just one week after a report that Amazon wanted to replace 75% of its workforce with robots, the online retail giant has announced that it is laying off 14,000 employees to reduce “bureaucracy” and invest in “our biggest bets” — namely, artificial intelligence.

“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 (in existing market segments and altogether new ones),” said Beth Galetti, SVP of People Experience and Technology, in a blog post on Tuesday. “We’re convinced that we need to be organized more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business.”

But a spokesperson for Amazon said not to blame artificial intelligence for most of the job losses.

“AI is not the reason behind the vast majority of reductions,” a company representative told CNET. The spokesperson said the reductions are part of the company’s effort at “reducing layers, increasing ownership, and helping reduce bureaucracy to drive speed and ownership, and be set up to invent, collaborate, be connected, and deliver the absolute best for customers.”

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Citing information from Amazon workers, Reuters said the Amazon departments most affected would be devices, advertising, Prime Video, HR and Amazon Web Services. Twitch has also reportedly been affected.

Reuters also reported that there would be more job cuts in the future, bringing the total job losses to 30,000.

The layoffs are reportedly the largest in Amazon history, and come just months after CEO Andy Jassy outlined his vision for how the company would rapidly ramp up its development of generative AI and AI agents. The cuts are the latest in a wave of layoffs this year as tech giants including Microsoft, Accenture, Salesforce and India’s TCS have reduced their workforces by thousands in what has become a frenzied push to invest in AI.

In a report issued earlier in October, it was projected that the global AI infrastructure market — driven mainly by the need to construct massive data centers — would grow from $26.18 billion in 2024 to $221.40 billion by 2034, an annual growth rate of nearly 24%.

Amazon is the third-largest employer in the US, but is also pushing further into robot workers. The e-commerce giant already has more than 1 million robots operating in its delivery and fulfillment network — two-thirds of the company’s human workforce. Amazon reportedly wants to automate 75% of its operations. A CNBC report said Amazon could save $4 billion annually if it automates as much as it plans to in its warehouses.

The key to Amazon’s automation plans is a quick and huge investment in AI. In his blog post on June 17, Jassy said, “Today, we have over 1,000 generative AI services and applications in progress or built, but at our scale, that’s a small fraction of what we will ultimately build. We’re going to lean in further in the coming months.”

Jassy said AI agents will be able to perform countless tasks, speed up innovation, and help Amazon stay “customer-obsessed, inventive, fast-moving, lean, scrappy.”

Those things won’t matter much to the thousands of Amazon employees who lost their jobs Tuesday. Kristi Coulter, a former 12-year Amazon employee and author of the book Exit Interview: The Life and Death of My Ambitious Career, criticized the company in a post on LinkedIn. RTO stands for “return to office,” referencing the fact that Amazon recently made all employees stop working from home.

Wait, I’m sorry: Amazon made people relocate, switch their kids’ schools, and bookend their days with traffic for RTO only to lay them off via a 3 a.m. text? What happened to the vibe and conversations that only being together at the office could allow?

‘Next big wave’

Longtime tech-industry analyst Paolo Pescatore of PP Foresight says the layoffs are an opportunity to streamline operations and invest in AI infrastructure. 

“Layoffs tend to be cyclical, and here lies the opportunity to streamline operations ahead of the next big wave driven by AI,” Pescatore told CNET. “With higher capital expenditures, companies are keeping a close eye on margins. Having said this, we are now seeing the first signs of this battle for supremacy emerging as companies compete to lure top talent from key rivals.”

Pescatore also said fears of tariff impacts and regulatory uncertainty in the US and Europe are also partly to blame for layoffs.