(Boursier.com) — Amazon gaining ground in pre-session this Friday. According to the Wall Street Journal, the American e-commerce giant should significantly reduce its costs and target in particular the division housing the Alexa assistant. The group would have initiated a review in this direction, targeting unprofitable units. Andy Jassy, the chief executive of Amazon, would lead this reflection, according to people familiar with the matter quoted by the WSJ. Alexa’s unit has over 10,000 employees and requires significant capital investment. Internal documents cited by the newspaper show annual operational losses of more than $5 billion on the unit in recent years.
After Meta and Twitter, Amazon could therefore in turn soon announce severe measures to reduce expenditure, while its share price has lost 43% of its value this year. Amazon has reportedly already notified employees of some unprofitable entities, asking them to look for jobs elsewhere within the company.
Alexa was sort of the pet project of Amazon founder Jeff Bezos until July 2021. He continued to invest in developing Alexa even as the assistant remained unpopular, people familiar with the matter told the WSJ. Still, an Amazon spokesperson told the WSJ that customer interactions with Alexa have increased more than 30% over the past year.
The voice assistant is now said to be particularly popular with customers for online shopping, playing music on demand and controlling lights, thermostats or other features in their smarthomes. Amazon is studying new features. Asked by Business Insider, an Amazon spokesperson said the company remains “excited” about both its big business and new initiatives, including Alexa, as well as Prime Video, Grocery, Kuiper and Zoox. “Alexa started as an idea on a whiteboard. In less than a decade, it has evolved into an artificial intelligence service with which millions of customers interact billions of times each week in different languages and cultures at around the world,” the spokesperson said, confident about the future of Alexa, which would remain “an important business and investment area for Amazon.”
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