Amazon upheaval: With morale shaken, Jassy looks for next big play after mass layoffs

Core Insights - Amazon CEO Andy Jassy aims to transform the company into the "world's largest startup" by reducing bureaucracy and flattening the organizational structure to enhance speed and competitiveness [2][3][4] - The company is undergoing significant layoffs, with approximately 14,000 corporate employees expected to be cut, marking the largest round of layoffs in Amazon's history [6][14] - Despite a better-than-expected third-quarter earnings report, Amazon faces challenges such as rising costs, increased competition in cloud services, and employee morale issues [8][9][10] Organizational Changes - Jassy has initiated a cultural overhaul, emphasizing a return to in-office work and a push for employees to achieve more with fewer resources [3][17] - The layoffs will affect various divisions, including stores and human resources, and are part of a broader strategy to streamline operations [5][14] - The company plans to increase the ratio of individual contributors to managers by at least 15% by the end of Q1 2025 [17] Financial Performance - Amazon's stock saw a 14% increase over two trading days following the earnings report, achieving a record close [8] - The company plans to boost capital expenditures to $125 billion, up from an earlier estimate of $118 billion, indicating a strong investment in AI infrastructure [24] AI and Innovation - Jassy has indicated that efficiency gains from AI will lead to a reduction in corporate staff in the coming years, while also pushing for increased AI adoption among employees [23][24] - Employees have expressed concerns about the implications of AI on job security, with some advocating for a more responsible rollout of AI technologies [25][26] Employee Sentiment - There are reports of declining morale among employees due to ongoing layoffs and pressure to innovate faster, particularly in AI [16][19] - Some employees believe that the push to flatten the organization has resulted in increased workloads without a corresponding reduction in tasks [21]