“Just perhaps on generative AI, obviously a lot of innovation here,” one proffered on the earnings call for the tech giant’s. “Maybe one follow up on AWS,” begged another, referring to the cloud division that hosts Amazon’s AI products. “On those AWS deals,” a third said. There was a fourth and fifth, too.
Amazon and its big technology peers – Microsoft, Alphabet, Meta and Apple – have grown so large that they face the same problem as Alexander the Great: they may have no more worlds left to conquer. AI might provide an answer, but it also creates a distraction. Amazon founder Jeff Bezos handed over the reins of the company in 2021 and his successor, Andy Jassy, cut back on many of his experimental bets.The business call underpinning the share price resurgence of the FAANG stocks has been the sharp job-and-spending cuts that all but Apple executed in 2022 and earlier this year.Amazon reported $143.1 billion in net sales, its key metric, for the third quarter on Thursday . That is up 13 per cent over the same period last year, with net income of $US9.
Just how much of that should be attributed to AI versus typical web services tasks of data crunching and running business’ IT needs is not known.Amazon eliminated about 27,000 jobs over several rounds of cuts. That’s a small portion of the company’s 1.5 million workers, but a much larger portion of the white-collar salaried positions that were the target of the cuts. The Facebook and Instagram-owner MetaThose cuts have padded profits even as key growth areas grow more slowly than before.