Amazon laid off about 16,000 employees last week, including 2,198 in the Seattle area, part of a companywide wave of cuts to the tech giant’s corporate workforce.
The layoffs last week followed a round in October in which more than 14,000 employees were laid off, more than 2,300 of whom were based in the Puget Sound region.
The layoffs in October came as a surprise to some. Another wave last week felt inevitable for those affected.
Amazon had been — and still is — riding high financially. The longtime leader in cloud computing, the company was fighting with Microsoft, Meta and others to maintain that dominance in the AI era. Despite a bumpy earnings report over the summer, Amazon shared in the rising market valuations fueled by AI.
Then came a wave of layoffs that began in October, the second since Amazon’s pandemic boom saw it secure its place as Washington state’s largest private employer. The deep cuts shocked a workforce that expected revenue growth would equate to job security.
When Amazon announced Wednesday that another 16,000 corporate workers would be cut, the feeling on the South Lake Union campus was less one of surprise than surrender.
Amazon, like most tech companies cutting their payrolls, is striving to become a leaner and more nimble company as it jockeys for first place in the AI race. All worry that their competitors will leave little room for them in the market should they fall behind.
It’s also increasingly clear that tech companies are shifting their available resources from talent — software developers, program managers and other engineering roles — to data centers and other AI infrastructure.
Leaders at top tech companies have given some voice to those shifting priorities. Amazon CEO Andy Jassy said in June that Amazon’s corporate workforce would likely shrink over the coming years.
Between the two waves of job cuts in October and January, Amazon laid off about 30,000 employees. For some, the three months between the rounds of layoffs felt like a panicked blur of anxiety and extra work.
A frantic pace
For the average worker, there hasn’t been much transparency in January’s layoffs. Amazon hasn’t described either wave of job cuts as being driven by performance, but workers didn’t want to give the company any reason to hand them a pink slip.
An Amazon Web Services security engineer laid off Wednesday said the writing has been on the wall for three months. He and others felt, he said, an extreme amount of pressure to do even more” than they previously had been doing. He spoke on condition of anonymity to protect future job prospects.
“Everyone ramped up their effort,” he said. “Personally, I was working 80 hours a week instead of 40.”
On Wednesday he received a push notification on his phone at 3 a.m. to reenter his password for his Amazon account. The password didn’t work. He checked his email and saw the news. He’d been laid off.
The security engineer loved working at Amazon. In 30 years, he said, he’d never worked in an environment like Amazon Web Services where they were innovating and developing state-of-the-art products.
“Yeah it got brutal, but I got to work with incredibly talented people,” he said. “I don’t regret for a minute working there.”
He’s not alone. Several employees who spoke with The Seattle Times said they’d loved working for Amazon. Software engineers described the complex problems they’d show up to every day to try and solve. Some were in awe of the people they got to work with.
But as Amazon shifted its priorities to AI over the past few years, they noticed a broader cultural shift. The pace at Amazon was already high, like “driving on a freeway at 100 miles per hour trying to catch things,” as the laid-off security engineer put it. The focus on AI increased that pace.
Training AI
Amazon is pouring billions of dollars into AI-enhanced products and services. The company projected last year that its capital expenditures would crest $125 billion for 2025.
It’s also spreading that technology throughout the company, giving employees new tools to use — and, in the parlance of AI, “train.” As some use AI tools through their daily work, the sense that they’re training their eventual replacement is creeping into their heads.
An Amazon software development engineer, speaking on condition of anonymity to protect her job, said that AI is helping with repetitive tasks. And when it doesn’t need to be corrected, it can speed up the work.
But she’s concerned with the trade off.
“You’re training AI on the data from workers and then just completely taking them out of the company,” she said. “We’re training AI models every day, making them better. And in turn we’re treated as completely expendable.”
Tech companies aren’t explicitly saying that AI will replace workers. The pitch coming from the industry’s giants is mainly focused on increases to productivity and speed. A project that would have once taken four weeks could theoretically be done in a few days.
But there are signals coming from high that the hiring spree tech went on from the 2010s through the pandemic is at an end.
Jassy’s memo to employees last year, in which the Amazon CEO mentioned a smaller corporate workforce, could have been interpreted a few different ways.
Blaming AI for replacing workers is one reaction to Jassy saying he expects the head count to decline. A more generous reading of his comments suggests, like the internet age did, the advancements of AI will radically change the jobs needed at tech companies going forward.
Amazon “will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs,” he said.
Amazon’s head of human resources Beth Galetti said in her memo to employees last week that the company is not planning more mass layoffs. But she was noncommittal about any smaller waves of job cuts in the future.
“Some of you might ask if this is the beginning of a new rhythm — where we announce broad reductions every few months,” Galetti said. “That’s not our plan.”
But every team will continue to evaluate operations and “make adjustments as appropriate,” Galetti said.
The security engineer said he’s seen this before in his 30-year career. For him, it echoes the hype of the dot-com boom to him, a soaring event for tech that eventually came back down to Earth.
“AI is a set of tools that will make people more efficient, but it doesn’t replace what we do,” he said. “They are trying to replace certain roles with AI and it’s not going to go the way they think it is. It’s going to have some negative results and then you might see a wave of hiring again.
Small cracks in the foundation of the AI hype showed up last week after Microsoft released its latest quarterly financial results.
The company reported a record quarterly profit. That wasn’t enough to appease investors’ concerns about Microsoft’s spending on AI, and a sell-off of the company’s stock on Thursday wiped out $357 billion in value. Microsoft’s share price plunged by 10% on Thursday and recovered slightly, though it was down more than 7% on the week.
Bloomberg reported that Microsoft was among other AI players like Google-parent Alphabet and chipmaker Nvidia that felt the scrutiny from Wall Street. Along with reporting a record profit, Microsoft also disclosed record quarterly investments in AI and slower cloud sales growth. Investors are growing skeptical that the massive influx of money into AI will translate into record sales.
Amazon will report its fourth quarter and full 2025 financial results and disclose its capital expenditures for the year on Wednesday. Wall Street analysts estimate it will report almost $715 billion in revenue for the year and $211 billion for the final three months of 2025.
Analysts are specifically keeping an eye on sales growth for Amazon’s cloud computing division, according to a report from The Information, especially after the Amazon-backed AI startup Anthropic raised revenue forecasts.
