Telepeer

Amazon starts round of layoffs in AWS cloud division

April 26, 2023

By Matt Day | Bloomberg

Amazon.com has started laying off employees in its cloud services operation amid slowing sales growth in its most profitable division.

Amazon Web Services personnel in the US, Canada and Costa Rica whose jobs were being eliminated were notified early Wednesday, the unit’s chief said in an email to staff.

SEE MORE: EV-maker Rivian lays off 239 Orange County workers

AWS generates most of the company’s profits but is experiencing slowing growth as corporate customers look to trim expenses.

Overall, Amazon is axing 27,000 mostly corporate positions after a hiring spree during the pandemic left the company with too many people.

Amazon employed 1.54 million people worldwide at the end of December. At least 170,000 of them work in California, according to industry reports. The company last year leased several hundred thousand square feet of office space in Orange and Los Angeles counties. Some of the office include cloud services, according to a story by TheRealDeal.com.

SEE: Amazon closing or delaying 9 California warehouses

Having wrapped up a round of job cuts earlier this year that totaled about 18,000 workers, Amazon announced another 9,000 layoffs in March, which Chief Executive Officer Andy Jassy said would land on AWS, human resources, advertising and the Twitch live-streaming service.

Cuts were rolled out in recent weeks in areas including Twitch and the company’s video game group.

“It is a tough day across our organization,” AWS chief Adam Selipsky said in the email reviewed by Bloomberg.

MORE ON AMAZON: Irvine gaming team spared latest Amazon layoffs

AWS, like much of the rest of Amazon, expanded its headcount rapidly as the pandemic boosted demand for digital services.

“Given this rapid growth, as well as the overall business and macroeconomic climate, it is critical that we focus on identifying and putting our resources behind our top priorities—those things that matter most to customers and that will move the needle for our business,” Selipsky said. “In many cases this means team members are shifting the projects, initiatives or teams on which they work; however, in other cases it has resulted in these role eliminations.”

Selipsky added that cuts in regions outside North America would roll out following local processes, including consultations with employee groups where mandated by law.

Some AWS-related teams had already been hit by layoffs, including recruiters and members of the “Just Walk Out” physical stores technology group that joined the division in a reorganization last year. But the first rounds of cuts landed heaviest on the company’s recruiting and human resources teams, its sprawling retail group and devices teams.

Wednesday brought more cuts to Amazon’s beleaguered HR group, which has been subject to waves of buyout offers and cuts that began in November.

Beth Galetti, who leads the People Experience and Technology team, as Amazon calls HR, announced the latest set of cuts in an email Wednesday. “These decisions are not taken lightly, and I recognize the impact it will have across both those transitioning out of the company as well as our colleagues who remain,” she said.

An Amazon spokesperson declined to comment on the latest layoffs, referring back to Jassy’s email in March saying that they would be coming.

Amazon has instituted a hiring freeze for jobs outside its warehouses and delivery operations — with exceptions for certain projects and jobs — and managers say it’s not clear when the company might begin hiring en masse again.

The vast majority of the retailer’s workers are hourly employees who pack and ship products in warehouses. Before the first round of layoffs began in November, the company said it had roughly 350,000 corporate employees.

Other tech giants have also reduced their headcount, including Meta Platforms, Google parent company Alphabet, Microsoft, Dell Technologies and International Business Machines.

Amazon is scheduled to report financial results on Thursday, and investors will be watching to see if cost-cutting measures have helped profitability and whether cloud services sales growth is bottoming out.

Business |

The Compost: Advice for clean energy job seekers

Business |

California’s lowest paid health workers want a raise; industry leaders are pushing back

Business |

Gap cutting hundreds of jobs in new layoff round

Business |

Southern California lost 4,600 real estate jobs in March

Business |

First Republic Bank slashing up to a quarter of its workforce

Orange County Register

News Details

Amazon starts round of layoffs in AWS cloud division

Related Articles

News

CONTACT INFO

QUICK LINKS

SERVICES

CURRENT NEWS