Amazon (AMZN) has initiated another round of layoffs as part of its ongoing efforts to streamline operations and reduce costs. As per the reports, the latest cuts affect employees within the company’s communications and sustainability divisions. Interestingly, the news comes as the company prepares to report its fourth-quarter results next week.
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According to an internal memo, the layoffs targeted roles that created unnecessary layers of management. This move comes after a review of the impacted departments, aiming to improve efficiency.
AMZN Undergoes Several Job Cut Rounds
Since Andy Jassy took over as CEO of Amazon in July 2021, Amazon has been actively working to cut down costs by lowering headcount and streamlining operations. Also, the company has been winding down some experimental or unprofitable ventures.
Importantly, the most significant layoffs occurred in 2022 and 2023, affecting at least 27,000 employees. Since then, Amazon has undertaken several smaller, targeted layoffs, impacting specific departments and roles.
Investors should note that the layoffs have allowed AMZN to focus on its core businesses and invest in areas with the highest growth potential. Jassy has highlighted the importance of AI and other technological advancements, which the company believes will drive future revenue growth.
Analysts Expect Amazon’s Q4 Results to Improve Y/Y
Wall Street analysts expect Amazon to post revenue of $187.35 billion in Q4, up from $169.96 billion in the year-ago quarter. Further, the company is expected to report earnings of $1.49 per share, compared with earnings of $1 in the prior-year quarter.
In the past week, seven Top-rated analysts have rated AMZN stock a Buy. Among these, Stifel Nicolaus analyst Mark Kelley has slightly revised Amazon’s Q4 online sales estimates higher, citing strong holiday sales data for the quarter.
Is AMZN a Good Stock to Buy?
Overall, AMZN stock has a Strong Buy consensus rating based on 49 Buys and one Hold assigned in the last three months. At $255.47, the average Amazon price target implies 7.76% upside potential. Shares of the company have gained 30.5% in the past six months.
