Amazon cuts 14K jobs for culture despite $180B sales

Amazon CEO Andy Jassy announced the company is laying off 14,000 employees, citing “culture” rather than financial pressures or AI automation as the primary driver. Despite quarterly sales growing 13% year-over-year to $180 billion, Jassy explained the cuts are designed to remove organizational layers and maintain Amazon’s startup-like agility as the company anticipates future AI efficiencies.

What they’re saying: Jassy emphasized the layoffs aren’t driven by typical corporate cost-cutting motives during Thursday’s earnings call.

• “Not really financially driven, and it’s not even really AI driven, not right now. It’s culture,” Jassy said when asked about the decision by an analyst.
• “We are committed to operating like the world’s largest startup, and that means removing layers.”

The big picture: Amazon’s workforce expansion created structural challenges that leadership believes are hindering operational efficiency.

• The company’s headcount peaked at more than 1.6 million employees in 2021 before declining to around 1.5 million by the end of last year.
• Jassy explained that rapid growth in “headcount, locations and lines of business” led to “a lot more layers sometimes without realizing it, you can weaken the ownership of the people that you have who are doing the actual work.”

Why this matters: The layoffs reflect Amazon’s strategy to prepare for an AI-driven future while maintaining competitive agility in a rapidly evolving tech landscape.

• Although positioned as a cultural restructuring, the cuts have nonetheless sparked concerns about technology eventually replacing human workers.
• The move demonstrates how even financially healthy tech giants are proactively reshaping their organizations ahead of anticipated AI productivity gains.

Market reaction: Amazon shares climbed 13% in after-hours trading following the earnings report, suggesting investors view the restructuring positively despite the significant job cuts.