Amazon Begins Laying Off Employees In An Effort To Strengthen Cost Structure

Amazon.com, Inc. AMZN started laying off staff in its cloud and PXT (People eXperience and Technology) divisions.

What Happened: Amazon Web Services CEO Adam Selipsky and human resources head Beth Galetti sent memos about job cuts to employees on Wednesday, according to CNBC.

The layoffs were expected after CEO Andy Jassy sent a memo to staff last month detailing plans to eliminate approximately 9,000 roles as the e-commerce giant focuses on cutting costs. 

In a new memo to staff, Selipsky said conversations with impacted employees commenced on Wednesday. 

As a result of rapid business growth and macroeconomic conditions, the AWS CEO said it's critical for Amazon to put resources behind the things that matter most to customers and "move the needle" for Amazon's business. 

Galetti told the PXT team much of the same, adding that the company will provide packages that include a 60-day, non-working transitional period with full pay and benefits, several weeks of additional severance, transitional benefits and external job placement support.

See Also: Analyst's Top Pick: AWS Revenue, E-commerce Expansion & Ad Cash Flow Put Amazon in Limelight

Why It Matters: The news comes just months after the e-commerce giant began cutting 18,000 jobs in what marked one of the largest rounds of layoffs among big tech firms. The job cuts, which were originally announced in November, are aimed at improving the long-term health of the company by strengthening Amazon's cost structure.

Amazon will report first-quarter results after the market close on Thursday. The company is expected to report earnings of 21 cents per share on quarterly revenue of $124.53 billion, according to Benzinga Pro.

AMZN Price Action: Amazon shares are trading higher Wednesday on the heels of strong cloud numbers from Microsoft and Google.

The stock was up 3.59% at $106.35 at the time of publication Wednesday.

Photo: courtesy of Amazon.