Amazon Putting Alexa Division Under Review

Amazon is joining other tech giants like Meta, Twitter, and Microsoft and taking a long, hard look at its least profitable businesses, the Wall Street Journal reported Thursday. 

Amazon's stock has already plunged 45% this year compared to last year, according to Insider.

Under its cost-cutting review, which will be led by CEO Andy Jassy, the company will be laser-focused on scaling down its least profitable businesses. Amazon has already told employees in certain unprofitable divisions to look for jobs elsewhere in the company, the WSJ reported. 

One of the areas the company is scrutinizing its Alexa business. According to internal documents reviewed by the WSJ, Amazon's device unit — which includes Alexa — has had operating losses of more than $5 billion a year in recent years. 

The device business currently has more than 10,000 employees and has received major influxes of investment, the WSJ noted. 

Alexa was somewhat of a pet project for Jeff Bezos, Amazon's founder and CEO, until July 2021. He continued to pour money into developing Alexa even as it remained unpopular, people familiar with the matter told the WSJ.  

Still, an Amazon spokesperson told the WSJ that customer interactions with Alexa have increased more than 30% over the past year. 

Right now, the voice assistant is particularly popular with customers for online shopping, playing music on demand, and controlling lighting, thermostats, or other features in their smarthomes. 

The company is tossing around ideas to add new capabilities to Alexa.