Published - January 5, 2023 @ 11:18 AM (EET)

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In the latest sign that a technology slump is worsening, Amazon.com Inc. (NASDAQ:AMZN) is laying off more than 17,000 employees, a much more significant number than the 10,000 cuts the retailer previously anticipated.

Though Amazon has a far greater workforce than its Silicon Valley peers, reducing its workforce by 17,000 would mark the e-commerce giant's steepest cut yet for tech companies during the current slowdown.

CEO Andy Jassy cited that "we've hired rapidly over the last several years" as a key reason behind the upcoming layoffs, affecting workers primarily across "Amazon Stores and PXT organizations."

The Wall Street Journal reported on the news.

"We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted," Jassy wrote. But, he added, "Because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me."

Elsewhere, the e-commerce giant announced a hiring freeze for its corporate workforce.

WHY IT MATTERS

In November, when the company was planning its cuts, a spokesperson said Amazon had roughly 350,000 corporate employees worldwide.

When demand started to weaken with customers moving back to shopping in stores, Amazon initiated a broad-cost-cutting review to pare back on unprofitable units, the Journal reported earlier.

The company then made targeted cuts in the spring and summer to bring down costs and later announced a companywide hiring pause before deciding to let employees go.

The trend has followed many tech companies, including Salesforce (NYSE:CRM), which, earlier on Wednesday, announced intent to reduce its workforce by 10%, also blaming overly aggressive hiring during the COVID-19 pandemic.

The company plans to inform employees impacted by the cuts starting 18 January, while Amazon investors reacted positively to the latest belt-tightening efforts. Following CEO comments, shares of Amazon gained nearly 2% in after-hours trading. 

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