Amazon confirms AGI division layoffs, 30,000 roles cut since late 2025

Wajeeh Khan Thu, July 23, 2026 at 8:28 AM PDT | 2 min read

• AMZN: -0.66%
• AFN.TO: -1.83%

Amazon (AMZN) confirmed on July 22 that it has eliminated positions within its Artificial General Intelligence (AGI) division — the unit responsible for building large-scale AI models, autonomous agents, and tools such as Nova Act.

The company declined to disclose the exact number of employees affected, though workers involved in model customization, post-training, and data services were among those let go.

What We Know About Amazon's AI Layoffs

Affected U.S. employees will receive 90 days of pay and benefits, outplacement support, transitional healthcare coverage, and eligibility for severance packages.

The layoffs follow significant leadership turnover within the AGI organization:

• Rohit Prasad, the original head of the unit, departed at the end of last year.
• David Luan, who joined through the Adept acquisition, left in February.

Amazon consolidated its AGI work under Senior Vice President Peter DeSantis in December, placing AI model development alongside custom silicon and quantum computing teams.

DeSantis has acknowledged publicly that Amazon's models have not yet reached the "frontier tier" for the most demanding workloads, signaling the company is still working to close the gap with rivals such as OpenAI, Anthropic, and Alphabet's (GOOG, GOOGL) Google.

Broader Restructuring Context

This latest round extends a broader restructuring that has now removed roughly 30,000 roles since late 2025, including approximately 16,000 corporate positions cut in January 2026.

Amazon stock is currently up about 8% versus the start of this year.

AI Remains a Priority for Amazon

Despite the job cuts, Amazon insists that artificial intelligence remains one of its highest priorities.

Key financial highlights:

• Capital expenditures: Management has guided for roughly $200 billion in 2026, more than 50% higher than 2025 levels.
• Debt financing: The company is raising tens of billions of dollars in debt to fund its AI infrastructure buildout.
• AWS backlog: Stood at $364 billion as of the first quarter, excluding a separate commitment worth over $100 billion tied to Anthropic.
• Trainium custom chip business: Has surpassed a $20 billion annual revenue run rate, with total commitments exceeding $225 billion.

The layoffs underscore a defining pattern across the tech sector in 2026: companies are simultaneously making record capital investments in AI infrastructure while reducing headcount to improve efficiency and redirect resources.

Amazon's decision to trim its AGI team while spending aggressively on computers, chips, and data centers illustrates the tension between long-term AI goals and short-term operational discipline.

Investors will closely watch its Q2 results on July 30 for evidence that this capital reallocation is translating into accelerating revenue growth and sustainable margin expansion at AWS.

How Wall Street Recommends Playing AMZN Stock

Wall Street remains bullish on AMZN shares heading into the company's quarterly print.

• Consensus rating: "Strong Buy"
• Mean price target: Approximately $315, indicating potential upside of nearly 30% from current levels.

On the date of publication, Wajeeh Khan did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com.