Amazon thinks generative AI will lead to efficiency gains, reduced total corporate workforce

Amazon (NASDAQ:AMZN) CEO Andy Jassy sent an open letter to employees and investors on Tuesday in which he highlighted how generative AI is transforming nearly every aspect of the company.

He pointed to tangible advancements such as the next-generation Alexa, a smarter AI shopping assistant, features like Lens and Buy for Me, and improved sizing recommendations, all powered by AI. Jassy also noted that AI is helping independent sellers create better product listings, enhancing advertising tools for brands, and driving innovation in AWS through custom silicon and advanced model-building services. Internally, Generative AI was said to be helping Amazon (NASDAQ:AMZN) optimize fulfillment, inventory, and customer service, leading to faster delivery and improved efficiency.

While Amazon is still early in the generative AI journey, Jassy said the company has a core belief that AI agents will fundamentally change work and life. The AI agents are expected to accelerate innovation, allow employees to focus on strategic thinking, and make work more engaging. While over 1,000 AI applications are already in use, Jassy expects that number to grow, leading to significant operational changes, including a likely reduction in certain roles as efficiencies increase.

“We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs. It’s hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company.”

In 2024, Amazon’s (AMZN) total worldwide employee count was around 1,556,000. Estimates suggest around 350,000 employees work in corporate roles.

Shares of Amazon (AMZN) are down 1.7% on a year-to-date basis.