An internal memo states the company has identified opportunities to decrease or discontinue investments in specific areas amid a wave of layoffs
Amazon is set to lay off several hundred employees in its streaming and studio operations, as indicated by an internal memo sent on Wednesday. The announcement coincided with Twitch, a live-streaming company and a subsidiary of Amazon, revealing its plan to lay off approximately 35% of its workforce, translating to 500 employees.
In the past year, Amazon reduced its workforce by over 27,000 employees, marking a significant downturn in the technology industry’s hiring surge during the pandemic. Amazon was not alone in this trend; Facebook and Microsoft each laid off 10,000 workers, while Google cut 12,000.
“We have recognized opportunities to decrease or cease investments in specific areas, all the while intensifying our focus and investment in content and product initiatives that yield the most significant impact,” stated Mike Hopkins, Senior Vice President of Prime Video and Amazon MGM Studios, addressing employees.
In a blog post, Twitch’s CEO, Dan Clancy, acknowledged that the company had expanded significantly with optimism about faster business growth. Clancy noted the need to adjust the company’s size, stating, “For some time now, the organization has been sized based upon where we optimistically expect our business to be in three or more years, not where we are today.”
In recent years, Amazon has made substantial investments to strengthen its media business, such as the $8.5 billion acquisition of MGM and an expenditure of approximately $465 million on 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 pricier ad-free subscription tier in certain markets, mirroring actions taken by competitors like Netflix and Disney.