Amazon starts cost cuts with layoffs at devices, service units

Amazon starts cost cuts with layoffs at devices, service units

Nov 16 (Reuters) – Amazon.com Inc (AMZN.O) is laying off employees in its devices and services units, America’s second largest private employer informed its staff on Wednesday following recent reports that it would cut around 10,000 jobs.

The e-commerce giant did not share details on the number of jobs it will cut or a time period. Its shares were down 3%.

Yet the announcement heralded a dramatic shift for a company known for its job creation and added shape to the latest layoffs in the technology sector.

The reduction covers the devices division that popularized speakers that consumers command through speech.

The retailer once aimed to make Alexa, its voice assistant that powers the devices, ubiquitous and present to place any shopping order, even though it was unclear how widely users have embraced it for more complex tasks than checking the news or weather.

News outlets including Reuters reported on Monday that cuts would amount to some 3% of Amazon’s roughly 300,000 corporate workforce, leaving warehouse and transportation associates unaffected.

Some individuals working on Alexa took to networking site LinkedIn on Tuesday saying they have lost their jobs.

The virtual assistant, a project inspired by a talking computer in science fiction show Star Trek, garnered headcount that grew to 10,000 people by 2019.

At the time, Amazon touted sales of more than 100 million Alexa devices, a figure it has not since refreshed publicly. Founder Jeff Bezos later said the company often sold Alexa devices at a discount and sometimes below cost.

While Amazon canvassed to encode intelligent answers to any question Alexa might expect from users, Alphabet Inc’s (GOOGL.O) Google and Microsoft Corp (MSFT.O)-backed OpenAI have had breakthroughs in chatbots that could respond like a human without any hand- holding.

Reporting By Jeffrey Dastin in Palo Alto, Calif. and Aditya Soni in Bengaluru; Editing by Arun Koyyur

Our Standards: The Thomson Reuters Trust Principles.

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