Amazon sees the costs to its layoffs to be $1.8 billion

Seattle-headquartered technology giant Amazon is factoring in $1.8 billion towards the severance costs of its ongoing people restructuring within the company. In its third-quarter numbers, the company attributed flat growth in its operating income (at $17.4 billion in the third quarter of 2025, compared with $17.4 billion in the third quarter of 2024) to two special expense items, namely $2.5 billion for an FTC settlement and $1.8 billion for estimated severance costs.

At the company’s earnings call, Brian Olsavsky, Chief Financial Officer, said, “The second charge of $1.8 billion relates to severance costs for role eliminations and impacts all three of our segments. The severance charge is recorded primarily in the technology and infrastructure, sales and marketing, and general and administrative expense line items.”

Amazon reports its income under three heads – North America, International, and its cloud business AWS. The company's largest revenue bucket, North America, saw the biggest hit in its operating income at $4.8 billion in Q3, down from $7.5 billion in the previous quarter.

The earnings release stated, “Excluding the $2.5 billion charge related to a legal settlement with the Federal Trade Commission, North America operating income would have been $7.3 billion. These results also include estimated severance costs primarily related to planned role eliminations.”

The International segment’s operating income was $1.2 billion, compared with $1.5 billion (rounded) in the second quarter of 2025, including estimated severance costs. However, the AWS segment saw an increase in its operating income at $11.4 billion, compared with $10.1 billion in the previous quarter, despite the costs on planned role eliminations.

On October 28, Beth Galetti, Senior Vice President of People Experience and Technology at Amazon, in a blog shared the message sent to its employees on the company’s layoffs. Referring to CEO Andy Jassy’s post earlier this year on the importance of having the right structure to operate as a startup.

“While this will include reducing in some areas and hiring in others, it will mean an overall reduction in our corporate workforce of approximately 14,000 roles. We’re working hard to support everyone whose role is impacted, including offering most employees 90 days to look for a new role internally (the timing will vary some based on local laws), and our recruiting teams will prioritize internal candidates to help as many people as possible find new roles within Amazon. For our teammates who are unable to find a new role at Amazon or who choose not to look for one, we’ll offer them transition support, including severance pay, outplacement services, health insurance benefits, and more,” Beth’s blog post said.