14,000 Corporate Jobs Cut as AI Reshapes Workforce

Four months after CEO Andy Jassy told employees that artificial intelligence would “change the way our work is done,” Amazon made good on that warning. The e-commerce giant announced Tuesday it will eliminate approximately 14,000 corporate positions, representing about 4% of its white-collar workforce, as it accelerates its transformation into what executives describe as “the world’s largest startup.”

The layoffs began Tuesday morning with impacted employees receiving termination notices via personal email from Beth Galetti, senior vice president of People Experience and Technology, informing them their roles were being eliminated and their employment would end after a non-working period.

Departments affected include cloud computing, devices, advertising, Prime Video, human resources, operations, Alexa, and Amazon Web Services, though the company indicated additional cuts will continue into 2026.

No choice but AI

The restructuring represents Amazon’s largest corporate workforce reduction since 27,000 jobs were eliminated between 2022 and 2023. However, this round carries a markedly different rationale. While previous cuts were attributed to pandemic over-hiring and economic headwinds, Galetti explicitly tied these layoffs to AI transformation, stating “this generation of AI is the most transformative technology we’ve seen since the Internet”.

The announcement follows through on Jassy’s June memo to employees, where he acknowledged that as Amazon rolls out more generative AI and AI agents,

“we will need fewer people doing some of the jobs that are being done today”.

He added that while it’s “hard to know exactly where this nets out over time,” the company expects AI to reduce its total corporate workforce over the next few years.

Amazon will offer most affected workers 90 days to search for new roles internally, with recruiting teams prioritizing those candidates. Those unable to find positions within Amazon will receive severance packages and additional benefits.

Spending billions while cutting thousands

The paradox at Amazon’s core has become impossible to ignore. The company plans to spend approximately $118 billion in capital expenditures in 2025, with the vast majority directed toward AI infrastructure, yet simultaneously eliminates thousands of positions to fund that transformation. That shows a jump from roughly $83 billion in 2024, positioning Amazon alongside Microsoft, Meta, and Alphabet in what industry analysts describe as a “cycle of competitive capex escalation.”

CEO Andy Jassy called this AI investment a “once-in-a-lifetime type of business opportunity”, emphasizing that shareholders will be pleased with the medium-to-long-term results. The spending will fund data centers, custom silicon like Trainium chips, and the infrastructure needed to power billions of AI agents that Amazon believes will operate across every company and imaginable field.

Yet the human cost of this strategic pivot is substantial. Neil Saunders, managing director of GlobalData, characterized the situation as

“a tipping point away from human capital to technological infrastructure”.

The efficiency narrative that Amazon leadership promotes masks what employees are experiencing, which is, the replacement of corporate functions with automated systems.

A different kind of unemployment

What differentiates these layoffs from traditional cost-cutting measures is their explicit connection to technological replacement rather than economic necessity. For the second quarter of 2025, Amazon reported revenue of $167.7 billion, up 13%, and net income of $18.2 billion, up 35%, with both metrics comfortably exceeding Wall Street estimates. The company isn’t cutting because it’s struggling, it’s doing so because AI can now perform the work more efficiently.

Internal teams have been testing AI tools for HR workflows, code generation, procurement, and customer-service decision trees, with many functions once performed by analysts, coordinators, or middle managers now automated or reduced to oversight roles. This showcases what Jassy has described as his initiative to reduce bureaucracy and eliminate management layers, including through an anonymous complaint line that has generated approximately 1,500 responses and over 450 process changes.

The implications extend beyond Amazon’s walls. According to Layoffs.fyi, tech companies have already eliminated more than 90,000 employees this year. Target announced 1,000 corporate job cuts last week, Meta eliminated 600 positions Wednesday, and Microsoft began cutting 9,000 jobs in July. Each company points to AI-driven efficiency as a primary catalyst.

The precedent

Amazon’s aggressive push into AI-powered workforce reduction sets a precedent that reverberates across corporate America. When the world’s second-largest private employer, with more than 1.54 million staffers globally, publicly declares that AI will shrink its corporate workforce, it normalizes a transformation that other companies will feel pressure to replicate.

Senator Bernie Sanders has already called for accountability, referencing a New York Times article reporting that Amazon executives believe 500,000 warehouse jobs could eventually be eliminated by replacing workers with robots. While Amazon disputes these figures, the company’s public statements about AI-driven workforce reduction lend credibility to concerns about automation’s broader impact.

The World Economic Forum’s 2025 Future of Jobs Report found that 40% of employers expect to reduce their workforce where AI can automate tasks, with clerical, administrative and data-entry roles among the most affected. Amazon’s restructuring accelerates this trend from abstract forecast to concrete reality.

The timing proves significant. Amazon is scheduled to report third-quarter earnings on Thursday, and shares rose 0.8% Tuesday despite the layoff announcement. The market’s positive response to workforce reduction signals that investors view AI-powered efficiency as value creation, regardless of the human cost. This dynamic creates pressure on executives across industries to demonstrate similar “transformation” to satisfy shareholder expectations.

What This Means

Amazon’s restructuring illuminates the contours of corporate employment in the AI era. The company is eliminating positions because algorithms can now perform tasks previously requiring human judgment, analysis, and decision-making. Software engineering has seen “the most pronounced slowdown in hiring” as AI tools increase productivity, while AI agents handle operations, supply chain management, demand forecasting, and internal HR and finance processes.

The 14,000 eliminated positions are merely the visible component of a larger transformation. Galetti’s memo indicated Amazon would continue hiring in certain areas while reducing headcount in other divisions heading into 2026, suggesting these cuts represent the beginning rather than the conclusion of Amazon’s AI-driven restructuring. 

For the corporate employees who received termination notices Tuesday morning, Amazon’s AI revolution has moved from abstract possibility to immediate reality.