Amazon Layoffs Hit Engineers Amid AI Transformation Drive

In the largest workforce reduction in its history, Amazon has laid off over 14,000 employees, with engineers bearing the heaviest impact. The cuts, spanning cloud computing, devices, retail, advertising, and grocery, signal a major corporate shake-up as the company adapts to new technological realities.

According to state filings in New York, California, New Jersey, and Washington, nearly 40% of the 4,700 job cuts in these states were engineering roles. Mid-level software engineers (SDE II) were disproportionately affected. Product managers, program managers, and senior leadership roles were also included in the reductions, reflecting a broad restructuring.

Amazon CEO Andy Jassy has repeatedly emphasized a shift toward a leaner, more agile corporate culture. By reducing organizational layers and encouraging employees to “do more with less,” Jassy aims to speed up decision-making and reduce bureaucratic hurdles.

The layoffs come as Amazon repositions itself for an AI-driven future. Investments are being redirected toward artificial intelligence, with tools like the company’s new coding assistant, Kiro, aiming to improve efficiency across its workforce. While AI adoption is changing the landscape for software developers, Amazon insists that technology is not the main reason for the layoffs.

The cuts have also affected some of Amazon’s experimental ventures. The company has scaled back on big-budget video game projects, including massively multiplayer online games, and has paused several hardware and retail initiatives. California filings indicate that the gaming division faced significant role reductions, particularly in its San Diego and Irvine studios, affecting designers, artists, and producers.

Other impacted teams include Amazon’s visual search and shopping unit, based primarily in Palo Alto, responsible for products like Amazon Lens and Lens Live. Engineers, applied scientists, and QA professionals in these units faced substantial job reductions. Even Amazon’s profitable online ad business saw over 140 sales and marketing roles cut in New York, representing roughly 20% of positions in the office.

The sweeping layoffs highlight a broader trend in the tech industry, where companies continue to trim headcounts despite strong revenues. For Amazon, the goal appears clear: streamline operations, reduce internal bureaucracy, and position the company to compete aggressively in the rapidly evolving AI landscape.