Dive Brief:

• Amazon is reducing its corporate workforce by about 14,000 roles, the company announced Tuesday in an internal note to employees from Amazon Senior Vice President of People Experience and Technology Beth Galetti. The company will notify impacted teams and individuals Tuesday, but did not provide details about the types of positions impacted.
• Amazon is offering most employees 90 days to find a new position internally — though that timeframe varies based on local laws — and recruiters will prioritize internal candidates, Galetti said in the note. Amazon will offer employees who either cannot find a new job internally or choose not to pursue one severance pay along with additional exit services.
• The news comes after Reuters on Monday reported with anonymous sources that Amazon could cut up to 30,000 corporate jobs. The e-commerce company declined to comment when Retail Dive asked about that higher layoff estimate.

Dive Insight:

Amazon’s latest round of layoffs builds on CEO Andy Jassy’s remarks to employees in June that the company will need fewer people doing some existing jobs as generative AI continues to advance. 

Galetti told employees on Tuesday that the workforce cuts are intended to reduce bureaucracy, remove corporate layers and shift resources as the company works to stay “nimble.”

“Some may ask why we’re reducing roles when the company is performing well,” Galetti said in her note to employees. “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).”

"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," she said.

The move from Amazon also builds on a note Jassy sent out in September 2024, wherein he flagged that the company would evaluate whether or not it had the proper organizational structure to foster the speed and innovation it desires. 

Amazon is not the first retailer this season to announce layoffs in a bid to simplify its structure and move faster.

Target on Thursday informed employees that it would lay off 1,000 corporate staff and close 800 open roles. Despite the company’s sales declines, the announced cuts are not part of an effort to save costs but instead intended to reduce corporate complexity and more easily “bring ideas to life,” incoming CEO Michael Fiddelke said.

“Unlike the Target layoffs, Amazon is operating from a position of strength,” GlobalData Managing Director Neil Saunders said in emailed comments. “In some ways, this is a tipping point away from human capital to technological infrastructure.”

Amazon’s second quarter results in August showed online store sales increased 4.6% year over year to $55.4 billion and physical store sales improved 3.6% to $5.2 billion. However, the company during its earnings call with analysts was focused on the Amazon Web Services portion of its business, which continues to be a core part of its success.