The company looked at some programmes that weren’t producing the returns it hoped, “an example of free shipping for all online grocery orders over $35 and changed them”….reports Asian Lite News
Amazon CEO Andy Jassy has said that the e-commerce giant made “the very difficult decision” to eliminate about 27,000 corporate roles and like most leadership teams, it will continue to evaluate what “we’re seeing in our business and proceed adaptively”.
Addressing the analysts after declaring a robust March quarter result, Jassy said while the company has taken several actions to streamline costs, “we’ve been able to do so while still pursuing the key strategic long-term investments”.
“This past year has seen us do a fair bit of cost streamlining. In some cases, it led us to shuttering certain businesses like our physical bookstores, Forestar Stores, Amazon Fabric, Amazon Care and certain devices where we didn’t see a path to meaningful returns,” Jassy noted.
In other cases, the company looked at some programmes that weren’t producing the returns it hoped, “an example of free shipping for all online grocery orders over $35 and changed them”.
“It’s hard to predict that all of these will be successful but only one or two working would change our business over the long term. We have a lot of work in front of us,” said Amazon CEO.
For the first quarter of the year, Amazon’s worldwide net sales were $127.4 billion, up 9 per cent year-over-year. Amazon reported $4.8 billion in operating income and overall net income of $3.2 billion in the first quarter.
Amazon shares jumped more than 11 per cent after the results.
The company also saw strong engagement in its advertising services with revenue up 23 per cent year-over-year, excluding the impact from changes in foreign exchange rates.
In AWS, net sales were $21.4 billion in the first quarter, up 16 per cent year-over-year and representing an annualised sales run rate of more than $85 billion.
Inspired by the ChatGPT success, Amazon is now building a large language model (LLM) to power Alexa that’s much larger and much more “generalised and capable”, which is going to rapidly accelerate the vision of offering the world’s best personal assistant.
More ‘generalised & capable’ AI model to power Alexa
Amazon CEO Andy Jassy said that ChatGPT is a good example of an application that’s being built.
“We’ll build some of those applications ourselves. So for instance, we think one of the most compelling applications that are going to be built in generative AI have to do with making developers much more effective with coding assistance,” he noted during the company’s quarterly earnings call.
“I think there’s a significant business model underneath it,” he added.
The generative AI models have become bigger and better in the last couple of months, much more quickly. It really presents a remarkable opportunity to transform virtually every customer experience that exists and many that don’t exist.
“We’ve been investing in building our own large language models for several years, and we have a very large investment across the company,” said Jassy.
In AWS, the company has 25-plus machine learning services “where we have the broadest machine learning functionality and customer base by a fair bit”.
“It is deeply ingrained in our heritage,” the Amazon CEO added.
In AWS, the company has been working for several years on building customised machine learning chips.
Amazon Alexa also has millions of endpoints being used across entertainment and shopping and smart home and information and a lot of involvement from third-party ecosystem partners.
“I think when people often ask us about Alexa, what we often share is that if we were just building a smart speaker, it would be a much smaller investment. But we have a vision, which we have conviction about that we want to build the world’s best personal assistant,” said Jassy.
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