Amazon announced on Wednesday that it's cutting several hundred roles in its cloud computing division, Amazon Web Services (AWS).
If you’ve ever streamed a movie on Netflix, attended a meeting on Zoom, or scrolled through your Facebook feed, you've indirectly used AWS, which provides computing power, storage, databases, servers, and more to millions of businesses — helping it to become the profit center of Amazon’s increasingly sprawling empire. Indeed, although it accounted for just 16% of revenue last year, AWS alone contributed 67% of the company’s ~$37 billion in operating profit.
Efficiency: From A to Z
The layoffs came just a day after Amazon ditched the “Just Walk Out” cashier-less technology used at its grocery stores — which turned out to be heavily reliant on a review team team in India — and at an interesting time for Amazon generally.
Although it overlaps with its peers Alphabet, Meta, Apple, and Nvidia in many ways, Amazon is a much more complicated entity: for example, no other tech company owns grocery stores. It’s the nation’s second-largest private employer, with 22x more people on its payroll than Meta, and the company’s core expertise is in less buzzy niches: deliveries, servers, supply chain logistics, e-commerce seller services, and, increasingly, ads.
Those businesses are wildly different, but Amazon’s ruthless drive for efficiency is universally applied to them all. The layoffs in the AWS division follow cuts in the subscription services business — home to Prime, Audible, and Twitch — earlier this year, and all told Amazon has shed more than 27,000 roles since the end of 2022 across almost every area of the company.
FOMO: Amazon isn’t completely ignoring the shiny new sectors, recently completing a $4 billion investment into AI startup Anthropic.
