Amazon Begins to “Batten Down the Hatches” in Preparation for U.S. Recession
Major tech companies that flourished during the COVID-19 pandemic are experiencing severe losses in revenue as the warning signs of an impending 2023 recession become apparent. It is likely that increasing economic concerns will continue weighing on consumer spending.
Amazon Chief Financial Officer Brian Olsavsky has expressed a shift towards cost-cutting: “we certainly are looking at our cost structure and looking for areas where we can save money.” This e-commerce machine has shockingly projected the current period revenue to fall $7 – $15 billion short of what analysts expected.
Amazon’s e-commerce division has been showing signs of slower growth, with the holiday demand expected to provide added challenges. Amazon looks to add over 100,000 workers to accommodate for the holiday season, announcing the intent to spend $1 billion to raise average starting salaries nationwide, dedicating millions to raise wages and benefits for delivery employees. The corporate retail division, however, has enacted a hiring freeze through the end of the year, placing a pause on corporate hiring.
According to Jeff Bezos, Amazon will “batten down the hatches” in response to warning signs that the U.S. is headed for a recession.