Amazon has implemented a workforce reduction of approximately 180 positions within its games division. This marks the second round of layoffs within a week for the online retail and digital streaming giant as part of a broader restructuring initiative, as revealed in an email examined by Reuters on Monday.
Christoph Hartmann, Vice President of Amazon Games, stated in the email dated November 13 that following an earlier restructuring in April, it became evident that a more concentrated allocation of resources towards areas exhibiting substantial growth potential was necessary for advancing the business. “After our initial restructuring in April, it became clear that we needed to focus our resources even more on the areas that are growing with the highest potential to drive our business forward,” he said.
The affected employees were notified on Monday morning of the elimination of their roles, constituting the second workforce reduction in the games division this year. Additionally, last week witnessed job cuts in Amazon’s streaming music and podcast segment, along with a small number of layoffs in the human resources unit referred to as People Experience and Technology (PXT).
The games division, responsible for offering downloadable versions of numerous video games on a monthly basis, as well as certain Twitch channels and related services, maintains its commitment to game development and publication, including titles like “Blue Protocol” and complimentary games featured in Prime Gaming.
Prime Gaming, a benefit included in the $139 annual Prime membership offering free shipping and streaming video services, is being refined to cater more prominently to customer preferences, particularly the delivery of free games every month.
In April, Amazon previously reduced approximately 100 positions within the games unit. Despite these adjustments, the company reported third-quarter net income that exceeded analysts’ expectations, and its revenue forecast for the final quarter of the year aligns closely with projections.
Over the past year, Amazon has undergone a significant workforce reduction, eliminating more than 27,000 roles. This reduction is part of a broader trend of tech layoffs following an industry-wide surge in hiring during the pandemic.
In his email, Hartmann assured employees of the company’s active recruitment for alternative roles within the division, emphasising confidence in the company’s future despite the challenges presented by the organisational changes. “I recognise that this is the second time this year that you are hearing about org-wide team changes and seeing colleagues go, so let me be very clear when I say this: I remain confident in our future,” he said.
Despite Amazon’s third-quarter net income significantly surpassing analyst predictions and the company projecting revenue for the final quarter in line with expectations, job cuts are underway. The fourth quarter holds particular significance for Amazon due to holiday shopping. Quietly, Amazon has been reducing its workforce, with a recent focus on cutting communications staff in its Studios, Video, and Music divisions last month.
Meanwhile, Amazon is making substantial investments in the development of an ambitious large language model (LLM) named “Olympus.” This initiative aims to position Olympus as a potential competitor to leading models created by OpenAI and Alphabet.
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