Tech giant Amazon said on Tuesday it will reduce its corporate workforce by about 14,000 roles, as it cuts down on operational layers to limit costs amid ballooning investments in artificial intelligence.
The company had about 1.56 million full-time and part-time employees at the end of last year. Amazon's corporate workforce includes roughly 350,000 employees.
Reuters first reported on Monday that Amazon is planning to cut as many as 30,000 corporate jobs beginning on Tuesday, as the company compensates for over-hiring during the peak demand of the COVID-19 pandemic. Other outlets also indicated the e-commerce and technology giant could cut as many as 30,000 positions.
Amazon has been restructuring its workforce across multiple divisions in recent months, with piecemeal job cuts across its books, devices and services unit, as well as its Wondery podcast division.
CEO Andy Jassy said in June that growing adoption of generative AI tools would reduce the total corporate workforce at the e-commerce giant in the next few years.
Corporations are increasingly using AI to write code for their software and adopting AI agents to automate routine tasks, as they look to save costs and cut reliance on people.
Amazon will next report earnings on Thursday, and is among the tech titans under pressure to show the merit of huge investments in AI.
"AWS will be under pressure to both show revenue acceleration and operating margin improvement in light of its massive AI investments," Emarketer principal analyst Sky Canaves said, referring to Amazon Web Services, its cloud computing unit.
Amazon will also likely be pressed for details about a recent AWS outage.
Popular internet services ranging from streaming platforms to messaging services to banking were offline for hours last week due to an outage in Amazon's crucial cloud network, illustrating the extent to which internet life depends on the tech titan.
The disruption affected streaming platforms, including Amazon's Prime Video service and Disney+, as well as Perplexity AI, the Fortnite game, Airbnb, Snapchat and Duolingo.
Mobile telephone services and messaging apps Signal and WhatsApp were affected in Europe, according to Downdetector.
People also reported problems reaching websites, including Amazon's own e-commerce shop.
Some banks, such as Lloyd's were also impacted, and pointed to AWS cloud computing platform as the source.
Amazon said it identified the "trigger of the event" as an issue involving the Domain Name System (DNS), which acts as an internet address book directing data traffic.
AWS leads the cloud computing market, followed closely by Microsoft Azure, with Google Cloud in third place.
Businesses, governments and consumers worldwide rely on their infrastructure for online activities.
