December 9, 2023

Amazon CEO Andy Jassy on Thursday published His annual shareholder letter where he reflected on one of the most challenging periods in the e-retailer’s history, and indicated he was confident that recent cost-cutting efforts would pay off.

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Jessie said that she had spent the last several months in a An “in-depth look across the company, business by business” to examine whether each unit has the potential to generate sufficient revenue, operating income, free cash flow and return on invested capital.

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“In some cases, this has led us to close some businesses,” Jesse wrote.

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As part of its belt-tightening efforts, Amazon kicked off a telehealth service and other experimental projects in recent months. It also put a halt to its fresh supermarket expansion, and scaled back warehouse expansion.

Amazon made the biggest job cuts in its 29-year history, letting 27,000 employees go through multiple rounds of layoffs. It also placed a hiring freeze for its corporate workforce.

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Even amid the cuts, Jessie, who takes over from founder Jeff Bezos in 2021, said Amazon is still focused on growing some of its more unproven businesses, like its Kuiper internet satellite and grocery units.

The company is also investing in new areas, such as machine learning technology, he added. Amazon is responding to a boom in generative artificial intelligence tools, such as OpenAI’s ChatGPT, which has caught the attention of Silicon Valley and triggered an arms race between Microsoft And Google,

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Jesse said Amazon has used machine learning in a variety of applications over the past few decades. It is now working on its own big language model, or AI programs, which have the potential to improve “virtually every customer experience”.

To that end, the company on Thursday released Bedrock, a service that gives developers access to LLMs from Amazon and other startups to build their own generative AI tools. One of Amazon’s language models, called Titan, can generate text for blog posts, emails and other documents. It has been said that a version of Titan is already being used to deliver search results through Amazon’s website.

Jesse said Amazon’s e-commerce and cloud computing units still have room to grow. But he acknowledged those businesses have faced some recent challenges, including a slowdown in Amazon Web Services as companies grow more cautious about their cloud spending.

“I am optimistic that we will emerge from this challenging macroeconomic time in a stronger position than we entered it,” Jesse wrote.

Following is the full text of Jesse’s letter: