E-commerce giant Amazon is set to lay off hundreds of employees across its subsidiaries, including more than 500 at Twitch, a third of the streaming platform’s workforce.
The job cuts also extend to Prime Video and film studio MGM, impacting several hundred employees. The move comes despite Amazon’s robust profits, revealing a strategic shift in its business approach.
Twitch Faces Major Job Cuts
Twitch, acquired by Amazon in 2014 for $970 million, will witness a significant downsizing, with CEO Dan Clancy confirming over 500 job losses.
Amazon stated that layoffs would also occur at Prime Video and MGM this week, affecting employees in the US and globally.
The decision follows Amazon’s reduction of more than 27,000 staff members in 2023, raising questions about the company’s workforce strategy.
In an email to Twitch employees, Dan Clancy described the move as a “painful step” aimed at building a more sustainable business. Despite paying out $1 billion to streamers in 2023, Clancy cited conservative growth predictions for the future.
Meanwhile, Mike Hopkins, Senior Vice President of Prime Video and MGM Studios, informed staff about the challenging decision and the company’s reallocation of investments.
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Amazon’s Q3 Profit Hits $9.9B Amid Strategic Changes
Amazon reported a substantial profit of $9.9 billion in the July to September quarter, a notable increase from $2.9 billion in the same period in 2022. The layoffs, coupled with recent initiatives like placing ads on Prime Video, indicate the company’s strategic reassessment and refocusing of resources.
The workforce reductions at Amazon echo broader trends in the tech sector, which experienced a surge during the pandemic but has since witnessed a contraction.
In 2023, the tech sector cut 168,032 jobs, a 73% increase compared to the previous year, according to Challenger, Gray & Christmas, a US career consultancy.
Amazon’s decision to cut jobs across its subsidiaries raises questions about the company’s evolving priorities and strategy.
The impact on Twitch, Prime Video, and MGM Studios underscores the changing landscape within the tech sector and the ongoing challenges faced by major players in adapting to dynamic market conditions.
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