Update: Amazon has released the following official communication in response to the report reported on LegaNerd.
We remain excited about the future of our core businesses, as well as more recent initiatives such as Prime Video, Alexa, Grocery, Kuiper, Zoox and Healthcare. Our senior leadership team regularly reviews investment prospects and financial performance, including as part of the annual review of the operating plan, which takes place each fall. In this year, we will of course take into account the current macroeconomic environment and evaluate options for cost optimization.
With regard to the Alexa division in particular, we then received the following information.
Alexa started as an idea on a chalkboard. In less than a decade, it has transformed into an artificial intelligence service with millions of customers communicating billions of times a week in different languages and cultures around the world. Even in the last year, interactions with Alexa have increased by more than 30% worldwide. We’re as optimistic about Alexa’s future as we’ve ever been, and it remains an important business and investment area for Amazon.
We leave you below with our original news.
Is it time for Amazon to adjust costs as well?
It’s also time for a spending review Amazon. CEO Andy Jassy puts the Alexa division and would consider cutting its budget significantly, at least temporarily. The news was reported by the Wall Street Journal, which claims that the process of optimizing spending has already begun.
Alexa is one bottomless pit, and Amazon sees no immediate returns from ramping up this service. For these reasons, the giant would have decided to move some team members to other divisions, reducing the budget for the development of new features.
The division that deals with Alexa (as well as home automation and smart products) has a prohibitive cost to Amazon, estimated at about Losing 5 billion euros every year.
The e-commerce giant therefore wants to take a break to reflect and carefully evaluate how the company’s resources have been spent in recent years. This means that some Alexa-related projects may be suspended indefinitely.
Responding to the published WSJ article, Andy Jassy reiterated the importance of Alexa within the company’s ecosystem of products and services. “In less than a decade, it has become an AI service that serves millions of customers around the world,” he said. “We’ve never been more optimistic about the future of Alexa.”
Source: Lega Nerd
