What Did Amazon Do This Week? - 05-03-2023 [+50 LINKS]

AMAZON STILL TRYING TO STOP THE BLEEDING

Music to AOC’s ears, Amazon paused the build of HQ2 in Virginia after much to-ing and fro-ing and deal-doing. Amazon’s Real Estate Chief, John Schoettler, said: “We’re always evaluating space plans to make sure they fit our business needs and to create a great experience for employees, and since Met Park will have space to accommodate more than 14,000 employees, we’ve decided to shift the ground-breaking of PenPlace (the second phase of HQ2) out a bit.”

Amazon also closed eight Go stores in Seattle, NYC, and San Francisco this week. The playbook is clear; understand, evaluate and respond. We’re seeing the last two parts here; Amazon is looking at what’s costing resources and stopping them. No one needs a second HQ when everyone wants to work from home unless there’s a great reason to come in (i.e. onboarding, training, creative exercises). Last month, Andy Jassy announced that the company would require corporate employees to return to the office at least three days a week. The move to pause the building and not stop is interesting, this could highlight a belief that Amazon is expecting the WFH move to reverse. Right now, Amazon has vacant whole floors in Seattle, and the company has also stopped other developments in Nashville.

SO WHAT?

When this move was on the cards, Amazon put multiple cities through the wringer, demanded a stack of data and concessions, and now it looks like working from home might have killed the whole thing. Not a good look, but a welcome one from stakeholders who want Amazon to get a grip on costs. The move isn’t unprecedented, Twitter is scaling back office space, and Microsoft recently announced it would postpone its plans for a second HQ in Atlanta. Amazon isn’t the only company that is struggling in this area.

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