Date: November 30, 2024
On Wednesday, Amazon.com Inc. announced its first major workforce reduction since mid-year, eliminating 18,000 roles across its Devices division and corporate functions. This marks the largest single round of layoffs in the company’s history and underscores Amazon’s shift toward a leaner cost structure amid persistent economic uncertainty.
Scope and Timing
- The cuts began in November and are concentrated in the Devices and Books businesses—responsible for Alexa, Echo, Kindle, and Fire TV products—as well as People, Experience & Technology (PXT) teams in human resources and recruiting.
- Impacted employees will receive a separation package that includes two months’ severance pay, transitional health insurance benefits, and external job placement support.
What Amazon Said
In a memo to staff, CEO Andy Jassy wrote:
“Between the reductions we made in November and the ones we’re sharing today, we plan to eliminate just over 18,000 roles. These changes will help us pursue our long-term opportunities with a stronger cost structure.”
He emphasized that annual planning “has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years.” Jassy added, “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.”
Context of the Layoff
- Amazon completed a voluntary workforce reduction in July 2024, cutting 10,000 positions mostly through attrition. This new round nearly doubles that figure.
- The Devices division had posted losses in its hardware and voice-assistant initiatives over the past two quarters, prompting management to streamline operations.
- Industry-wide, Big Tech has shed over 200,000 roles since early 2023, and Amazon’s latest cuts place it at the forefront of cost-saving measures among its peers.
Employee Reaction and Support
Affected teams were notified beginning November 20. According to internal sources, morale was already low after a summer hiring freeze and slowed consumer spending. Amazon has pledged to work closely with impacted employees:
“We are providing impacted employees with a separation payment, transitional health insurance benefits, and external job placement support,” Jassy said, adding that in Europe, employee representative bodies will be engaged before notifications begin.
Financial Impact
Analysts estimate the cost of severance and related benefits to total between $500 million and $800 million. However, investors welcomed the move: Amazon’s shares rose 1.8% in after-hours trading on the expectation that tighter expense controls will boost profit margins.
First Round Acknowledged
This is Amazon’s first large-scale layoff since its pandemic-driven hiring spree in 2021–22. A company spokesperson confirmed no further cuts are planned in 2024 beyond this announcement.
Looking Ahead
Industry watchers say Amazon’s next challenge will be maintaining innovation momentum in Devices while managing a slimmer headcount. As Jassy noted, “Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year.”
With nearly 18,000 colleagues departing, Amazon enters 2025 re-organized around its core e-commerce, cloud, and advertising businesses—leaving the future of hardware projects like Alexa and Fire TV to a leaner, more focused team.
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