"Amazon, with Market Cap Dropping Below 10 Trillion Won, Temporarily Halts Hiring... 'Unusual Economic Environment'"

[Image source=AP Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Amazon, the world's largest e-commerce company that dropped out of the $1 trillion market cap club due to deteriorating performance, has decided to temporarily halt hiring.

According to the Wall Street Journal (WSJ) on the 3rd (local time), Amazon made this decision to cope with future economic uncertainties. Beth Galetti, Senior Vice President of People Experience and Technology, stated in a letter sent to employees the day before, "This hiring freeze will continue for the next few months," adding, "We will monitor the economic and business conditions and make reasonable adjustments accordingly."

This follows last month's announcement to temporarily suspend hiring in the core retail division until the end of the year. This hiring freeze affects technical positions, including software developers. It is reported that it does not apply to staff at distribution centers across the United States.

Amazon's hiring freeze indicates that the recent economic situation is quite serious. In the letter, Galetti mentioned, "We are facing an unusual macroeconomic environment," and "Considering this situation, we need to balance hiring and investment." Earlier, Jeff Bezos, the founder and chairman of the board, also expressed concern last month by posting a video of David Solomon, CEO of Goldman Sachs, on his Twitter, stating "A recession is coming," and said, "The current economy is telling us to prepare for a crisis."

Amazon's performance has significantly worsened this year as concerns about a recession have increased due to the Federal Reserve's (Fed) aggressive tightening. Not only did third-quarter sales fall short of market expectations, but the outlook for the fourth quarter, which includes the year-end shopping season such as Christmas, is also bleak. Additionally, the cloud business, once considered a 'cash cow,' is also sluggish.

On the 1st, its market capitalization also fell below $1 trillion. This is the first time in 31 months since April 2020, when Amazon was hit hard by the pandemic, that it has dropped out of the $1 trillion market cap club. This year, Amazon's stock price has dropped about 46%, far exceeding the declines of the S&P 500 and Nasdaq indices.

Meanwhile, in the New York stock market this afternoon, Amazon is trading at around $89.90 per share, down 2.41% from the previous close.

This content was produced with the assistance of AI translation services.