• by Sarah Mahoney  @mahoney_sarah, January 5, 2023

Amazon is fond of doing everything in a big way, and today it’s a tsunami of layoffs. The company, which had been expected to cut about 10,000 jobs, says it will eliminate 18,000 workers.

And analysts who follow the company say this is likely not the last belt-tightening moves the ecommerce giant will make as layoffs sweep through the tech community.

But it’s worth noting that while ecommerce growth continues to slow, it’s still reshaping the economy. In its final analysis of the holiday season, Adobe announced that in the just-wrapped holiday period, which it defines as from Nov. 1 through Dec. 31, customers spent $211.7 billion. That’s a record, and marks a 3.5% year-over-year gain.

Cyber Week was big, but so were many other days, with 38 days topping $3 billion in sales -- the same as last year.

Toys, video games, watches, gift cards, cosmetics and smart home products all experienced strong demand.

Many consumers were looking for bargains, pressured by inflation. 

Almost half -- 47% -- of holiday sales were made via smartphone, up from 43% in the 2021 holiday period. And Christmas Day set a record, with mobile driving 61% of sales.

“At a time when consumers were dealing with elevated prices in areas such as food, gas, and rent, holiday discounts were strong enough to sustain discretionary spending through the entire season,” says Vivek Pandya, lead analyst, in the Adobe report. “The big deals drew in consumers and drove volume, helping retailers who were challenged with oversupply issues, particularly in categories such as apparel, electronics, and toys.”

Experts say Amazon layoffs have more to do with overzealous tech expansion than with a cutback in online shopping.

And the news may not even be bad for Amazon. Morgan Stanley, as reported in MarketWatch, believes the layoffs are likely to save Amazon about $3.6 billion a year. The surprise, however, comes from where the cuts are: Morgan Stanley had expected the layoffs to focus on segments devoted to Alexa and devices, which account for an estimated $10 billion to $15 billion in investments

Instead, the reductions are aimed at Amazon Stores and its People Experience and Technology Solutions—or PXT—teams.

In a blog note to employees, Amazon chief executive officer Andy Jassy aimed to reassure staff that the layoffs represent a relatively minor bump in the road, explaining that companies that last a long time go through different phases.

The Seattle-based company “has weathered uncertain and difficult economies in the past, and we will continue to do so,” he said. “These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles.”