Amazon Faces Poor Performance, Halts Construction of Second Headquarters and Closes Unmanned Convenience Stores

Amazon, the world's largest e-commerce company, which has embarked on cost-cutting measures, has decided to halt construction on its second headquarters.

Amazon logo and a shopping cart placed in front of it / Photo by Yonhap News

John Schottler, Amazon's head of real estate, stated on the 3rd (local time), "We are always evaluating whether our space planning aligns with business needs," adding, "Since Met Park can accommodate more than 14,000 people, we have decided to change the groundbreaking ceremony for PenPlace."

Met Park and PenPlace are the first and second phases of Amazon's second headquarters project near National Landing in northern Arlington, Virginia. The main headquarters is located in Seattle. The first phase is mostly complete and is scheduled for occupancy in June. The second phase was originally scheduled to begin construction in January but was postponed. The date for resuming construction has not been announced.

PenPlace was initially planned to be completed by 2025, featuring three 22-story office buildings, over 9,290 square meters of retail space, and a 106-meter-high tower. Amazon has not disclosed the reason for the construction delay, but it is interpreted as part of a large-scale restructuring.

In addition, Amazon has decided to close eight Amazon Go unmanned convenience stores operated in Seattle, New York, and other locations.

Jessica Martin, an Amazon spokesperson, said, "Like other physical retailers, we periodically evaluate our store portfolio to make optimal decisions," adding, "We have decided to close some Amazon Go stores in Seattle, New York, and San Francisco."

Amazon Go has been operating in 20 major U.S. cities since 2018. The stores to be closed include two each in Seattle and New York, and four convenience stores in San Francisco, totaling eight locations.

Earlier, in January, Amazon laid off 18,000 employees and restructured unprofitable business units. This was due to continued poor performance, with Amazon's net profit in the third quarter of last year decreasing by 9% compared to the previous year, and nearly 20% in the fourth quarter.

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