Amazon cuts AGI jobs as AI focus sharpens after 16,000 layoffs

Amazon cut jobs in its artificial general intelligence group, the company confirmed Wednesday, as it restructures its AI organization following the departure of two top executives and a $200 billion annual capital expenditure plan.

"We're sharpening our focus on the initiatives that matter most for customers, so we can move faster on what counts," an Amazon spokesperson said. "That focus means some difficult decisions, including eliminating some roles within parts of our AGI organization."

The company declined to disclose how many employees were affected. The cuts hit two teams led by Adeeb Shanaa, vice president of AGI Data Services, and Vishal Sharma, vice president of AGI Information, according to employee posts on internal forums. The reductions follow a much larger round in January that eliminated about 16,000 positions across the company, part of more than 30,000 job cuts since October 2024.

Amazon is pouring record sums into AI infrastructure even as it pares head count. The company has forecast $200 billion in capital expenditures for 2026, a more than 50% increase from 2025, and is raising tens of billions in debt to fund its AI buildout. The tension between aggressive investment and workforce reduction reflects Amazon's effort to concentrate resources on projects with the highest commercial potential.

Leadership Shifts Reshape AGI Strategy

The restructuring follows significant turnover at the top of Amazon's AGI division. Rohit Prasad, the company's top AGI executive, left at the end of 2025. David Luan, who joined Amazon in 2024 through the acquihire of his startup Adept and led the AGI Lab, departed in February. In December, Amazon consolidated all AGI work under Senior Vice President Peter DeSantis, who now oversees a broader technology group spanning AGI, silicon chip development, and quantum computing.

DeSantis acknowledged in an interview last month that Amazon's AI models "haven't been at the very frontier for the very largest, most demanding workloads." The company's AGI group released a set of foundation models called Nova in 2024, but Amazon has struggled to match the performance of leaders OpenAI, Anthropic and Google in the race for increasingly capable AI systems.

Competitive Pressure and Investor Stakes

Amazon's AGI cuts come as the three largest cloud providers — Amazon Web Services, Microsoft Azure and Google Cloud — collectively spend more than $250 billion annually on AI infrastructure. Amazon's in-house chip development, including its Trainium processors, is central to its strategy of reducing dependence on Nvidia's GPUs, which command more than 80% of the AI accelerator market.

For investors, the question is whether Amazon can close the AI capability gap while simultaneously cutting costs. Amazon shares have risen about 18% this year, supported by cloud revenue growth and the broader AI spending narrative. But the company's $200 billion capex plan has drawn scrutiny from analysts who question the near-term return on such spending when Amazon's own models trail those of OpenAI and Anthropic.

The layoffs in the AGI unit, while small relative to Amazon's 1.5 million-strong workforce, signal that even strategically critical teams face restructuring as the company tries to balance long-term AI ambition with near-term financial discipline.

This article is for informational purposes only and does not constitute investment advice.