CNBC’s Jim Cramer explained Tuesday why he is adamant about this policy. Amazon He offered optimistic commentary on CNBC Investing Club’s Charitable Trust about the tech giant’s future, praising the upcoming round of layoffs.
“If Amazon can find a way to make more money for shareholders, we’ll go for it,” he said. “As a shareholder, I like that. I like that Amazon is never trying to make a profit.”
Amazon announced Monday that it will lay off about 14,000 employees. According to a report from CNBC, the layoffs are expected to be the largest in the company’s history. The move comes as part of the company’s multiyear cost-cutting efforts.
According to Reuters, the company plans further layoffs, with Amazon saying it could cut up to 30,000 employees.
Amazon said in a blog post that the layoffs were driven by advances in artificial intelligence and attempts to reduce bureaucracy.
“This generation of AI is the most revolutionary technology since the Internet, allowing companies to innovate much faster in existing market segments and in entirely new market segments than ever before,” Amazon executive Beth Galetti said in a statement. “We believe we need to organize more efficiently, with fewer layers and more ownership, to move as quickly as possible for our customers and our business.”
A few years ago, Mr. Kramer criticized Amazon’s mass hiring during the pandemic, saying at the time that he felt the company wasn’t doing enough to eliminate redundant workers after the pandemic ended. But since then, the company has taken the time to make good decisions about how to increase employee productivity, he said, adding that AI is now poised to help large companies “figure out who can accomplish more with less.”
Kramer acknowledged that Amazon has not been able to outperform the market. S&P500 In the last few years.
But he emphasized that he takes a long-term view when it comes to stock ownership, saying he believes investors should hold on to a company if they like it and think it’s reliable. Cramer said he feels Amazon is one of the most valuable services he uses, adding that he believes the stock price “will eventually catch up to my judgment.”
Kramer praised Amazon’s ability to weather the pandemic, grow sales in Europe and strengthen its web services division. He expected AWS’s growth rate to accelerate once Amazon releases its earnings on Thursday.
Mr. Cramer also expressed his determination not to repeat Amazon’s recent mistake of selling off major technology companies. alphabet Concerned about the fallout from losing the government’s antitrust lawsuit, he donated the money to a charitable trust.
“We sold Alphabet at the wrong time. We left 100 points on the table. My concern, it was misplaced,” Cramer said. “The Department of Justice could not stop Google for anticompetitive conduct, as it did with Microsoft earlier this century.”
Amazon did not immediately respond to a request for comment.
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