Amazon Layoffs: CEO Andy Jassy opens up about 27,000 job cuts, AI and more

Amazon CEO Andy Jassy in an annual letter to stakeholders wrote about the turbulent year that the company went through. He spoke about 'hard decision' of laying off 27,000 employees because of cost cutting and other measures that he had to take for the growth of the platform.

Amazon CEO talks about the cost-cutting measures 

Amazon’s second phase of layoffs took place last month where the company fired 9,000 employees. In the first phase, the company made 18,000 job cuts. During the recent layoffs, Jassy wrote a letter to the employees where he claimed that the decision “is best for the company long term”.

Notably, Amazon is offering a separation payment, transitional health insurance benefits, and external job placement support to such employees.

He revealed that the company had to take a “deep look across the company, business by business, invention by invention” to understand if “we had conviction about each initiative’s long-term potential to drive enough revenue, operating income, free cash flow, and return on invested capital.”

This was Amazon’s biggest mass layoff in the history. Despite this, Jassy believes that Amazon’s best days are in front of the company.

He further highlighted that to trim costs, Amazon had to shut down several physical stores, businesses, Amazon Fabric and Amazon Care efforts.

In his recent letter, he wrote, “There are a number of other changes that we’ve made over the last several months to streamline our overall costs, and like most leadership teams, we’ll continue to evaluate what we’re seeing in our business and proceed adaptively.”

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He also announced that the employees are now requested to come to office at least three days a week, beginning in May. 

Amazon focuses on AI 

The company CEO talked about spending heavily on AI tools that have become popular in the past few months. The company is working on its own Large Language Models (LLMs). “We have been working on our own LLMs for a while now, believe it will transform and improve virtually every customer experience, and will continue to invest substantially in these models across all of our consumer, seller, brand, and creator experiences,” Jassy wrote.

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