In what may be termed as one of the most brutal years of tech layoffs, Amazon Web Services (AWS) has joined the ranks of giants like Meta and Microsoft in announcing massive layoffs.
The latest round of job cuts by cloud computing giant AWS raises questions about the cloud industry’s future, reflecting a shift in the strategy of reallocation of resources to stay competitive in the face of Microsoft Azure and Google Cloud.
While Amazon has not disclosed the exact number of layoffs, it has confirmed that there would be hundreds of employees affected in roles in sales, marketing, global services, and physical stores technology such as the ‘Just Walk Out’ system.
Also Read: Microsoft kicks off second mass layoffs in recent months
The last layoffs in the company took place in 2023 and 2024, which had then been termed by the company as part of its broader effort to streamline operations following over-hiring during the pandemic.
Amazon’s CEO, Andy Jassy, had stated in a 2023 shareholder letter that they we focused on “building a leaner, more innovative organisation to drive long-term growth”.
Industry experts say the current global economic uncertainty has also had an effect on the cloud computing landscape, especially as AWS faces mounting pressure to maintain its $90 billion revenue stream that had generated an operating income of $7.2 billion in the 2023 Q4 earnings reveal.
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“Clients are optimising budgets, which impacts cloud demand. We’re aligning our workforce to focus on high-impact areas like AI and infrastructure,” said an Amazon spokesperson to media.
Employees who have received their termination letters say a severance of 60 days’ pay and job placement support are generous, but future job insecurity stings. Many worry that AI is replacing their roles.
While AWS retains its 31 per cent dominance in the market share, frequent layoffs have begun denting its reputation as an employer. In a 2024 interview, Jassy had predicted the transformative potential of AI, saying “Generative AI will reshape how we work, creating new opportunities while streamlining others”.
While Microsoft Azure has gained ground by integrating generative AI into its platform with its OpenAI partnership, achieving over 30 per cent growth in Q1 2025. Google Cloud, despite being smaller, has also started leveraging AI to attract enterprises.
Meanwhile, AWS, known for services like EC2 and S3, has focused on AI with guns blazing, using tools like Bedrock and partnerships with Anthropic.
The latest layoffs may fund AWS’s investments like the £8 billion UK data center expansion that aims at supporting AI workloads, they also underscore the need for workers to prepare themselves for AI-driven roles.
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