Amazon.com announced a significant round of layoffs affecting several hundred employees in its streaming and studio divisions.
The internal memo, shared on Wednesday, revealed the company’s ongoing efforts to streamline operations and reduce investments in specific areas.
This move comes as part of a broader trend of job cuts that have persisted over the past two years and are extending into 2024.
The affected staff at Prime Video and Amazon MGM Studios in the Americas will be notified on Wednesday, with employees in other regions expected to receive notifications by the week’s end.
Last year, Amazon cut more than 27,000 jobs, contributing to a wave of layoffs in the U.S. tech industry following a period of extensive hiring during the pandemic.
Mike Hopkins, the senior vice president of Prime Video and Amazon MGM Studios, communicated the decision to employees in a note, stating, “We’ve identified opportunities to reduce or discontinue investments in certain areas while increasing our investment and focus on content and product initiatives that deliver the most impact.”
In recent years, Amazon has made substantial investments in its media business, including the acquisition of MGM for $8.5 billion and a significant investment of around $465 million in the first season of “The Lord of the Rings: The Rings of Power” on Prime Video in 2022.
Additionally, the company plans to introduce advertisements on Prime Video and a more expensive ad-free subscription tier in select markets, aligning with strategies employed by competitors like Netflix and Walt Disney.
As part of the industry-wide trend of focusing on specific projects and divisions, many companies, including Amazon, are re-evaluating and reprioritizing their resources.
Before the recent layoffs in the streaming and studio departments, Amazon had also cut jobs in its Alexa voice assistant division, while Microsoft made staff reductions in its LinkedIn professional network.
Reports suggest that Amazon’s Twitch service is planning to lay off 500 employees, constituting approximately 35% of its workforce, adding to the ongoing job cuts across various tech companies.
Despite these developments, Amazon’s shares, which experienced an impressive 80% surge last year, showed a 1.5% increase in afternoon trading.
