Evercore ISI’s Mark Mahaney joins ‘Varney & Co.’ to discuss Amazon’s meteoric growth on AWS, its new $335 price target, and why he’s cautious on Meta amid surging AI spending.
Amazon announced Wednesday that it would cut about 16,000 positions across the company as part of an organizational overhaul aimed at “reducing levels, increasing ownership and removing bureaucracy,” while continuing to invest heavily in areas such as artificial intelligence.
In a message to employees, Beth Galetti, Senior Vice President of Amazon of People Experience and Technology, said the reductions affect teams that were still finalizing restructuring efforts first announced in October.
Most U.S.-based employees whose positions are eliminated will have 90 days to look for new positions internally, while those who do not transition will receive severance and other support.
Galetti said the changes were not intended to signal a recurring cycle of broad workforce reductions and that Amazon would do so. continue recruitment in strategic areas.
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The Amazon logo is displayed on the facade of the Amazon Germany headquarters in Parkstadt Schwabing, Munich, Bavaria, January 27, 2026. (Matthias Balk/photo alliance via Getty Images / Getty Images)
“We are in the early stages of building each of our businesses and significant opportunities lie ahead,” she told employees.
“Some of you might wonder if this is the start of a new rhythm where we announce broad discounts every few months. That’s not our plan. But as we always have, each team will continue to evaluate ownership, speed, and the ability to invent for customers, and make the necessary adjustments“, Galetti added. “This has never been more important than today in a world that is changing faster than ever.”
The announcement comes a day after Amazon detailed an aggressive expansion of its grocery business, including plans to expand same-day delivery of fresh groceries to more communities in 2026 and open more than 100 new stores over the next few years.
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An Amazon Go grocery bag is seen during a media tour of a cashier-free Amazon grocery store in Seattle, Washington, February 21, 2020. (Jason Redmond/Reuters/Reuters)
The company also announced Tuesday that it would close its physical Amazon Go and Amazon Fresh stores, converting some locations into Whole Foods Market outlets, while continuing to invest in faster delivery options such as same-day perishables.
Amazon founder Jeff Bezos, who stepped down as CEO in 2021, has become a major investor in artificial intelligence efforts outside the company.
The New York Times reported in November, Bezos became deeply involved in a new artificial intelligence startup, devoting time and capital to it.
The company, known as Project Prometheus, was launched with about $6.2 billion in funding, including backing from Blue Origin’s founder, who took on a leadership role as co-chief executive, according to the Times.
Amazon founder Jeff Bezos gestures as he speaks during the keynote panel at Italian Tech Week 2025 in Turin, Italy, October 3, 2025. (Remo Casilli/Reuters / Reuters)
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The scale of the investment places the company among the most funded AI startups in an increasingly crowded and competitive field.
Big tech companies Among them, OpenAI, Microsoft, Meta and Google parent Alphabet have also increased their investments and announced a wave of new AI initiatives.