AWS Sees Returns as Automation Takes Over Workforce

Amazon Faces Major AWS Outage and Plans AI-Driven Job Cuts Amid Heavy Investment

  • Amazon Web Services (AWS) outage lasting over 15 hours affected multiple websites and services.
  • The outage stemmed from a domain name system (DNS) problem and issues with Amazon DynamoDB, a cloud database service, at the Virginia US-East-1 data center.
  • Amazon plans to automate 75% of its operations by 2033, potentially replacing 600,000 U.S. workers with AI-powered robots.
  • The company expects to cut 160,000 jobs in the U.S. by 2027 amid a major AI-driven restructuring, particularly impacting the People Experience and Technology team.
  • Despite heavy AI investment exceeding $100 billion this year, Amazon stock (AMZN) shows modest gains; analysts have price targets between $248 and $297, above the current price near $216.

On Tuesday, Amazon stock rose following the resolution of a significant outage at its Amazon Web Services (AWS) platform that lasted more than 15 hours. The disruption, which affected numerous websites and services, originated at the US-East-1 data center in Virginia. Amazon attributed the outage to a domain name system (DNS) issue and complications with its DynamoDB database service.

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According to reports, Amazon aims to replace more than 600,000 U.S. jobs with AI-powered robots by 2033 to enhance operational efficiency. Documents revealed by The New York Times indicate the company’s robotics division targets automating 75% of all operations. The company anticipates eliminating 160,000 U.S. positions by 2027 as part of this plan.

The AI-driven overhaul also involves workforce reductions in the People Experience and Technology team, with job cuts extending into various consumer business units. Amazon has invested over $100 billion in capital expenditures this year, largely toward AI-focused data centers designed to support internal AI infrastructure and cloud computing services for clients.

Wall Street analysts maintain a generally positive outlook on Amazon stock despite heavy AI spending. Year-to-date, AMZN shares are up only 1%, trading around $216.48, with recent upgrades from firms such as Wedbush and Cantor Fitzgerald suggesting potential price targets between $248 and $297. On Tuesday, shares rose approximately 2% to $222.

For more details, see the original coverage by The New York Times and other linked sources.

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