Amazon will extend its job cutting plans this year, announcing it will shed 18,000 staff as it tackles a downturn in the world economy.
The tech giant had already revealed plans in November to lay off some 10,000 workers and said its latest announcement included those departures.
Staff will learn if they face the axe from January 18. The majority of job losses will be in in Amazon Stores and its People Experience and Technology Solutions teams, known as PXT.
Chief executive Andy Jassy said: “This year’s review has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years.
“[We] are deeply aware that these role eliminations are difficult for people, and we don’t take these decisions lightly or underestimate how much they might affect the lives of those who are impacted.
“We are working to support those who are affected and are providing packages that include a separation payment, transitional health insurance benefits, and external job placement support.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.
“These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles.”
While the lay offs are just a fraction of Amazon’s 1.5m workforce around the world, it comes as the company faces strikes from warehouse workers in Coventry demanding higher pay.
Amazon’s share price has fallen 48pc in the last year as consumers cut back on spending due to the cost of living crisis.
Read the latest updates below.
07:13 AM
Amazon’s battle to reduce costs
Amazon, the world’s largest online retailer, spent the end of last year adjusting to a sharp slowdown in e-commerce growth as shoppers returned to pre-pandemic habits.
Amazon delayed warehouse openings and halted hiring in its retail group. It broadened the freeze to the company’s corporate staff and then began making cuts.
Chief executive Andy Jassy has eliminated or curtailed experimental and unprofitable businesses, including teams working on a telehealth service, a delivery robot and a kids’ video-calling device, among other projects.
The Seattle-based company also is trying to align excess capacity with cooling demand. One effort includes trying to sell excess space on its cargo planes, according to people familiar with the matter.
The first wave of cuts announced in November landed heaviest on Amazon’s Devices and Services group, which builds the Alexa digital assistant and Echo smart speaker, among other products.
07:04 AM
Job cuts spreading across tech sector
Amazon joins other tech giants in making major cuts.
On Wednesday, Salesforce announced plans to eliminate about 10pc of its workforce and reduce its real estate holdings.
In November Facebook owner Meta also announced it was cutting 11,000 jobs.
In the same month, Twitter axed more than 3,000 roles after Elon Musk bought the company in a $44bn (£35bn).
07:00 AM
Amazon shares boosted on job cuts
Though the prospect of layoffs has loomed over Amazon for months — the company has acknowledged that it hired too many people during the pandemic — the increasing total suggests the company’s outlook has darkened.
Amazon investors gave a positive reaction to the latest belt-tightening efforts, betting it may bolster profits at the e-commerce company.
The shares climbed nearly 2pc in late trading after the Wall Street Journal first reported on the plan.
Eliminating 18,000 workers would be the biggest cut yet for tech companies during the current slowdown, but Amazon also has a far bigger workforce than Silicon Valley peers.
It had more than 1.5m employees as of the end of September, meaning the latest cuts would represent about 1pc of the workforce.
06:56 AM
Good morning
Amazon is laying off more than 18,000 employees — the biggest corporate workforce reduction in its history — in the latest sign that a tech-industry slump is deepening.
Chief executive Andy Jassy announced the move in a memo to staff Wednesday, saying it followed the company’s annual planning process.
The cuts, which began last year, were previously expected to affect about 10,000 people.
The reduction is concentrated in the firm’s corporate ranks, mostly Amazon’s retail division and human resources functions like recruiting.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” he said.
“These changes will help us pursue our long-term opportunities with a stronger cost structure.”
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What happened overnight
Asian shares rose on hopes for China’s emergence from the pandemic, while the dollar found support after analysts spotted a warning against betting too heavily on rate cuts this year in minutes from the last Federal Reserve policy meeting.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 1pc to touch a four-month high at one stage, before paring gains.
Japan’s Nikkei bounced off a three-month low. Tokyo’s blue-chip stocks advanced following Wall Street gains as markets shrugged off messaging from the Federal Reserve reiterating its commitment to lowering inflation.
The benchmark Nikkei 225 index rose 0.4pc to 25,820, while the broader Topix index trimmed earlier gains but closed up 0.1pc to 1,868.
Asia’s optimism comes while minutes from the Federal Reserve’s December meeting, published on Wednesday, contained a caution against late-year rate cuts traders have priced in.
Fed committee members noted that “unwarranted easing in financial conditions” would complicate efforts to restore price stability, the minutes showed.
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