# Amazon’s $18 Billion Profit and the 14,000 Layoffs — What’s Really Going On
Amazon is hitting record profits while **thousands lose their jobs**. The company posted **$18 billion in profit** as its **stock approaches an all-time high**, yet the layoff count has reached **14,000 employees** — with the **final figure possibly hitting 30,000 (nearly 10% of its workforce)**.
▲ At Amazon Games Studio, San Diego — 99% of staff laid off
Some employees discovered their fate in startling ways — including vacationing staff receiving push notifications reading: *"You have been terminated."*
Business results looked strong. So why the sweeping layoffs?
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## The Official Reason: AI
▲ Layoffs at Microsoft, Procter & Gamble, Nestlé, Intel, and more
Amazon’s HR chief, **Beth Galetti**, wrote to staff:
> "*AI is the most transformational technology we’ve seen since the internet.*"
> "*...Amazon needs a leaner organization with fewer layers.*"
The narrative: AI boosts efficiency, reduces bureaucracy, and trims layers. But inside Amazon, **AI is not simply replacing employees** — the strategy targets **middle management**.
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## Operating Like the World’s Largest Startup
Historically, big tech meant *more people → more output*.
Now, in the AI era, the formula is shifting: *more compute → fewer people*.
**Example:** OpenAI nears a trillion-dollar valuation with only ~4,000 employees.
**Andy Jassy’s vision:** Make Amazon run like the **world’s largest startup**, cutting bureaucracy at all costs.
### Who Got Cut?
- **78%** of U.S. layoffs were **L5–L7 managers**.
- Divisions hit:
- **HR (People Experience & Technology)** — ~15% roles cut
- **Devices & Services** — Kindle, Echo, Fire teams
- **Audible**
- **AWS Enterprise Support**
▲ L5 compensation: $120K | L6: $210K | L7: $280K
Managers’ tasks: coordination, status reporting, memo drafting — all work **generative AI excels at**. Amazon is **hollowing out its corporate middle layer**.
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## AI Narrative vs. Reality
Not all insiders believe AI is truly ready to replace tens of thousands of jobs.
**CNN** reports Amazon admitted AI was *not* the main factor for most of the cuts — suggesting **"AI-washing"**: framing decisions as AI-driven to signal innovation.
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## Lessons for Professionals
Whether AI is the driver or the excuse, the trend is clear: **organisational flattening** and a shift in talent needs.
For individual creators, it’s a cue to adapt and monetize AI skills. One example:
**[AiToEarn](https://aitoearn.ai/)** — an open-source global AI content monetization platform enabling:
- AI generation of multi-platform content (Douyin, Kwai, WeChat, YouTube, LinkedIn, etc.)
- Cross-platform publishing
- Content analytics & model ranking
More info: [AiToEarn博客](https://blog.aitoearn.ai) | [AiToEarn开源地址](https://github.com/yikart/AiToEarn)
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## "Preemptive Layoffs": AI as Financial Runway
> "**Very few companies are actually replacing humans with AI right now**" — Jessica Kriegel, Chief Strategy Officer, Culture Partners (via CNN)
Instead, leaders are creating **financial room** for potential AI initiatives.
### The Problem: "Workslop"
AI output (slides, summaries, code) often looks good but is error-prone.
Surveys: **40% of AI-involved work** needs human fixing, costing 2 hrs and $186 per task.
### ROI Reality
MIT study: **95% of corporate AI investments yield zero returns**.
▲ Task-specific AI adoption success rate: 5%
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## The AI Arms Race — and Its Burn Rate
If AI isn’t replacing workers, it’s **costing billions** to develop.
▲ AWS still leads cloud share but growth trails Microsoft Azure & Google Cloud
### Numbers:
- 2024 AI infrastructure spend: **$85 billion**
- 2025 forecast: **$120 billion** (+40%)
- Cutting 1% of white-collar wages → thousands more **H100 GPUs**.
Analysts: Amazon must **offset massive long-term AI infrastructure investments**.
▲ Major AI services rely on these clouds (Claude → AWS, Gemini → Google, OpenAI → Azure)
**Translation:**
Layoffs convert HR, retail, and non-core salaries into funding for the AI arms race.
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## Pandemic Over-Hiring: The Other Reason
Yale economist Ernie Tedeschi:
> "**Mostly a correction of pandemic-era dynamics, rather than AI impact.**"
During the 2020–21 e-commerce boom, Amazon tripled its workforce to 1.6 million, hiring heavily in corporate roles.
Now:
- Cutting white-collar jobs (pandemic hires)
- Hiring **250,000 seasonal warehouse workers**
- Investing $1 billion to raise warehouse pay > $30/hr
**AI as scapegoat** neatly reframes plain cost-cutting as visionary AI pivot.
▲ Source: https://x.com/KobeissiLetter/status/1983209896721236139
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## AI Economics: Computing Power Wins
Big tech’s motive: fund AI infrastructure — GPUs, data centers, foundational models.
▲ Meta building a data center the size of Manhattan
Other companies (UPS, Target, Lufthansa) use **ready-to-run AI services** to cut costs — without carrying R&D burdens.
**Outcome:** Wealth from AI accumulation flows to **compute power**, not labor.
Semiconductor giants like **NVIDIA** are top beneficiaries.
▲ NVIDIA — first $5 trillion market cap company
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## For Those Laid Off
Regardless of cause, displaced talent faces the same challenge: adapt skills to the new AI economy.
Platforms like **[AiToEarn官网](https://aitoearn.ai/)** show how to:
- Create AI-generated content
- Publish across multiple networks simultaneously
- Analyze and monetize creative output globally
Open-source tools combining creation, publishing, analytics, and model ranking will be key in **turning AI costs into creative profits**.
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