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Amazon lays off 16,000 workers.
They sent out some kind of diary invite called Project Dawn.
Then the invitation was retracted and then obviously the announcement came showing that 16000 people are now at risk.
It's World Business Report from the BBC World Service.
And how the British singer Harry Styles is planning a record-breaking tour.
First, in a sign of the potential impact of AI on jobs, Amazon has announced a cut of 16000 more jobs today.
That's as well as the 14,000 announced last year.
Now Amazon employs 16 million people around the world, so today, 16000 is 1 of its global workforce.
At the same time, these cuts aren't affecting warehouse workers, but white-collar staff.
Let's talk about it with Aaron Canna, former AI engineer at Amazon Web Services, now co-founder of Reserved AI, and Channing Kelly-Ray, global business consultant, previously global director of diversity at Amazon Web Services.
Channing, first of all, what's the significance of this today, do you think?
I think that, given the sheer volume, especially that a lot of those roles that are being eliminated today happen in the shadow of different cities or towns where Amazon is an anchor employer,
And when those jobs leave, it's very difficult to backfill those.
And so they impact not just Amazon's total workforce but workforce within cities or towns, that impact the tax based spending and future work opportunities, and especially that they're being displaced by ai.
Um, the industrial revolution at least allowed for a transition period for people to figure out what that, what next would come as a result of new technology, but we're not really seeing that right now.
People don't know what's next, and aaron uh, disproportionately affects some communities.
As channing was saying, what do you make of the, the significance of what we've heard today?
Yeah, I mean, I think there's a few stories here.
Amazon kind of is playing both sides of this AI tidal wave that's hitting the world right now.
On one side, as we're hearing, as they're putting in streamlining operations, they're using more AI tools.
In fact, AI tools that they develop, like the ones on Amazon Web Services which is another place actually, where we've seen these cuts hit such as things like AgentCorp, Amazon's agents that actually go and do work and they sell to companies so that those companies can go and automate jobs themselves.
So I think there's sort of an interesting dynamic here where they're almost dogfooding the stuff internally that they're trying to now sell to other organizations.
And so right now, maybe it's affecting places where Amazon operates.
But if you have a technology department in your business that's buying from Amazon Web Services, You bet that they're going to sell this technology if they can streamline operations to these customers as well.
And so I think there's a much bigger story at play if this is a trend that truly is only getting started here at Amazon, but through their technology that they're selling to businesses.
And we saw when Amazon Web Services went down, half the internet went down.
So they sell to a ton of businesses.
This could really be something that broadly affects communities around the world, not just the places that Amazon operates.
And it may well affect other organisations I suppose Shannon as well because when these giants do this kind of thing, other organisations go.
OK, maybe we'll take a piece of that.
Absolutely.
I mean, look at what happened after the announcement of the 16,000 job cuts.
UPS announced that they were going to be eliminating 30000 and closing 24 of their different sites or centers.
But you know, I think that Andrew, the bigger story that folks aren't talking about is when I'm invited to come and speak on college and on campuses for university.
There are young people that were told you know, go into technology, be computer science, learn technology, learn these critical skills, and they're graduating now without opportunities.
And a lot of those internships and those entry-level jobs that now require three years of experience coming out of university.
They're not getting that.
AI is eliminating those entry-level jobs that many young people thought that they would be able to depend on After getting degrees, that tech companies invested heavily in in middle schools and high schools and colleges and universities, and now those doors are closing.
And I'm also thinking, Aaron, that Amazon's already cut a load of entry-level jobs.
So, although we're just sort of piecing together what's going on here from the outside, you guys have both worked there.
It looks like now they've got rid of the entry-level jobs, they don't need so many people to manage those people and look after the administration of those workers who are no longer there.
Yeah, I think if you read a lot of the – you know output of what the executives are saying, and this is not the first cut right.
They've been cutting for uh now multiple years.
It seems like it's coming in waves and we're a close partner of amazon uh in our business.
So so we see kind of front and center what's happening on their partner teams, on their sales teams, on their marketing teams, etc.
Who we work with And, as a function of that streamlining of the organization, what they're really trying to do is remove management, flatten the organization, and that's happening at all different levels.
And the form that that takes is the organization is going to be flatter.
You can't have as many layers.
You can't have those bottom layers.
You need to have much more independent senior people who are empowered to have more scope and do more.
And so I think this is sort of the natural outcome of that activity, and that's not something that we're just seeing in amazon.
We're seeing this broadly to different scales across a lot of big tech microsoft uh facebook, etc.
Stay with me if you would.
I want to just let you listen to a bit of this interview with the chief executive of Cisco, one of the leading tech companies, who said that, while some companies won't survive AI, in the end will be bigger than the internet.
He's been talking to our economics editor, Faisal Islam.
Cisco is one of the world's leading technology companies behind some of the critical IT infrastructure enabling the day-to-day use of AI.
It was hit when the original dot-com bubble burst in 2000, but survived and thrived after losing 80 of its value.
Now its boss, Chuck Robbins, confidant of President Trump, says while AI technology is unstoppable, there may be some financial turbulence ahead.
Every major technology revolution that we see feels like hype to begin with, and there's been a lot of discussion about is this a bubble?
And the answer is probably yes.
There's carnage along the way, but it is going to be bigger than the internet.
Mr Robbins said some jobs were already being eliminated by AI, particularly in areas like customer services, where he said companies would need fewer people.
There's some jobs that we already know are going to probably be changed and some that will be eliminated by using AI.
Give us an example.
I think you're going to see a lot of contact center customer service jobs are going to change, but we're using a ton of AI and we're able to do more with fewer people, and that's just the way it is.
But he urged people not to be afraid of the technology and embrace it in their lives.
Shannon Kelly-Ray.
When we see all organisations using AI for more and more and more functions, why do we constantly get told that there is this enormous AI bubble and the firms behind it are overvalued?
Well, I think that what we see is that, even when we talk about that flattening and organisations, letting the whole staff and they think that they can replace these roles, and that there is still something that you cannot replace in terms of the human element.
You know, I and many people believe that that flattening really is their way of eliminating headcounts and being able to redirect headcount and funds to AI.
You know, in 2022 we talked about chat, GPT and it seemed this new conversation, but at the point that you hear about it, technology's talked about it for 10 years already.
And so I think that the real problem that lies ahead is not just the fact that they can do more with less, they can streamline, but what happens for all of those people that are left out.
What happens to all of those people that lose jobs and lose roles?
When they created the calculator, there was a fear that the human element of mathematicians, bookkeepers and accountants would be replaced, that we'd lose the ability to think.
But what happened was calculators didn't eliminate math jobs.
They raised the ceiling on what those jobs could do.
We still have to figure out in terms of raising the ceiling.
What will people do in the shadow of this AI revolution?
And Aaron, as AI forges ahead at breakneck speed with, you know, people struggling to keep up with it.
Why do we have this kind of constant fear of the bubble, do you think?
Well, I think the CapEx numbers speak for themselves.
If you look not just at Amazon, but at all the hyperscale cloud providers, the spend is only accelerating on data centers, on GPUs on, in some cases, like with Amazon and Google their own in-house chips for AI.
And so, like with any capacity build-out, just like with Cisco and the internet and dark fiber in the nineties, you have the risk of overbuilding.
And whenever there is that risk of overbuilding and overshooting.
You know, talks of a bubble make a lot of sense.
It's almost natural economics.
But if you look at the demand that Amazon web services the business that we sit on and are partnered with at at Amazon actually has from its customers, it can't bill the demand for things like anthropic tokens or things like G.
APUs of the latest generation Blackwell.
And it has customers like OpenAI willing to sign $35 billion deals for those types of services.
And so, yes, there is definitely bubble-like dynamics.
It comes back to this capacity build-out and the CapEx spend, which I agree is definitely squeezing out the labor spend at Amazon, and they're reorienting their business to try and maintain shared AWS, maintain leadership in the cloud and the AI world.
And that takes a lot of capital spend that can't go to labor.
But I think that the demand, at least in the near term, is there.
The question is, at what point do they get out over their skis and then will they regret it?
And I think that's not just Amazon, that's everyone in this AI race right now.
All right.
Aaron Keller and Channing Kelly-Ray, both of whom used to work at Amazon Web Services.
Thank you for being with me.
Now to Chicago.
Susan Schmidt is their portfolio manager at Exchange Capital Resources.
Susan, on AI, let's talk about Microsoft and their results today.
Doing better than expected, bearing in mind how much money they're spending.
So doing better than expected in how much money they're spending, that's absolutely true.
Although investors are hesitant because they're starting to want a payoff for the investments that they've made in AI.
And so we are starting to see investor questions around when does there become a return on capital?
Because it is heavy upfront investment.
And while they exceeded in expectations, revenues year over year were up.
17 people are concerned that The cost of the AI is continuing.
And now because Microsoft has been at the forefront of this.
When do the investors start to see a return?
Now, Meta's results also heavily impacted by artificial intelligence.
Tell us more.
Meta, a different story from the investor standpoint, up 10% in the aftermarket.
And that's because the revenue forecast for the coming year exceeded expectations.
Fourth quarter sales were up 24% year over year.
So very strong numbers to impress the street with.
What's interesting is that Meta has had these on-again, off-again quarters throughout the years they've reported.
And each time investors have either taken the stock up 10, and there have been several quarters where they've gone down 10.
So we're seeing this flip-flop back and forth.
This happens to be a quarter where the stock price is up 10% in the aftermarket.
Investors are taking it well.
But interestingly, Meta came out and said we will be spending yet more on AI next year, in 26 almost twice the level of the 72 billion they spent in 2025.
Now, let's talk about Tesla.
We've focused a lot on Tesla in the last year or so.
I presume Elon Musk's political involvement and its impact on Tesla's results is on the wane.
So how's the company doing and what's behind that?
So the company reported...
This afternoon.
Today is a unique day for Tesla because it is the first time that they've reported year-over-year decline in revenue and net income.
So the number of cars sold declined and their net income declined.
EPS and revenue for the fourth quarter were above expectations, but that's because expectations had been lowered so much.
We did see a continued decline.
This is the third quarter in a row. where sales have fallen successively.
And we do see pressure on that EV market, particularly in the US, now that the tax subsidy has gone away from that and overhang potentially from his involvement with the administration and getting involved in politics.
Now to the Federal Reserve, not cutting rates this time, but holding them as they have been.
Let's hear from the Fed Chair, Jerome Powell.
The U.S. economy expanded at a solid pace last year and is coming into 2026 on a firm footing.
While job gains have remained low, the unemployment rate has shown some signs of stabilization and inflation remains somewhat elevated.
In support of our goals.
Today, the Federal Open Market Committee decided to leave our policy rate unchanged.
Having lowered our policy rate by 75 basis points over the course of our previous three meetings, we see the current stance of monetary policy as appropriate to promote progress toward both our maximum employment and 2 inflation goals.
So that's Jay Powell's rationale.
Can't imagine.
This has gone down terribly well in the White House, where they always want rates to be cut.
That is the pressure that the market is watching this back and forth between the Trump administration and President Trump and Chairman Powell as to what happens with rates and can the Fed maintain its independence?
Chairman Powell has come out and been very vocal that he believes that he is being attacked now for a holding rate study.
And he has credibility with the market.
So it's something that investors are willing to see this tug of war play out.
And they want to know that there's an independence to the central bank.
Chairman Powell and the Fed's decision to hold rates is largely due to the stabilization in the labor market.
And yet there's still indicators that inflation is running closer to 3%.
It's not coming in down to that 2% level the Fed has targeted as the ideal.
We'll see how that plays out.
We also have some lapses from data that we had from the government shutdown this past fall that are continuing to carry through, and the impacts on tariffs following through on the inventory channel and the cost of goods.
So Chairman Powell is juggling a lot of things there to try and figure out what exactly is going on.
This is World Business Report from the BBC World Service with Andrew Peach.
The German authorities have searched Deutsche Bank buildings in Berlin and Frankfurt in connection with suspected money laundering.
Prosecutors say some executives and employees of Germany's largest bank are under investigation.
Tommy Wilkes is the European finance editor for Reuters.
German federal police have raided the offices of Deutsche Bank in Frankfurt and Berlin.
They say this is part of an investigation into money laundering.
They say that Deutsche Bank, which is Germany's biggest lender, maintained relationships with foreign companies suspected of money laundering and that they're investigating unnamed employees of the bank.
Beyond that they haven't given us a huge amount of detail, but we understand the case involves some transactions between 2013 and 2018.
And some media although this is unconfirmed say it relates to the bank's relationship with Russian billionaire Roman Abramovich.
Many people will know Abramovich as one of the best known wealthy Russians who used to be in London, former owner of Chelsea Football Club, a prominent oligarch before the war in Ukraine, after which he was sanctioned over his links to Putin.
It's worth saying that a legal representative for Abramovich says he's unaware of any probe and that he's always active within the law.
And Deutsche Bank says it's cooperating with the investigation.
And Tommy, these allegations have been around for ages because actually, although we're talking about this search now, they've searched the bank's premises twice before.
That's right.
And we don't know if they're all connected.
So the context here is that this is not the first time that Deutsche Bank's anti-money laundering controls have been the focus of attention.
The bank under the current CEO is really trying to leave that reputation for scandals and weak money laundering controls and various run-ins with regulators trying to leave that all behind it.
But it's clearly still an issue for German prosecutors.
But we don't know if previous raids are connected to this.
And what could this potentially lead to in terms of sanctions against the bank?
So in previous instances Deutsche Bank has had to pay quite large regulatory fines over problems, including those linked to money laundering.
Back in 2017 there was a very large fine that it had to pay US and UK regulators over some artificial trades between Moscow, London and New York.
That authorities said was used to launder about 10 billion out of Russia.
We don't know where this is going to head.
Sometimes these investigations go nowhere.
And there have been instances where Deutsche Bank has been found innocent on all counts.
It's also worth adding that it's quite an embarrassing situation time for Deutsche Bank for this to have happened, because tomorrow it reports its annual financial results, when I think it will be wanting to tell investors how much money it's made.
It's expected to make its biggest annual profit since 2007 and instead it's probably going to be answering more questions about this police investigation.
So the good news will be wiped off the front pages.
Are there more controls to stop this kind of thing from happening now?
Generally, there are more controls and banks have really tried to tighten up their anti-money laundering controls, particularly in relation to Russians and sanctioned Russians.
But these trades obviously predate the war in Ukraine.
They predate someone like Abramovich coming under control.
UK and EU sanctions.
So in general, yes, banks are much tighter on this, but it still happens.
And sometimes the cases can be really historic.
They can be decades back, but prosecutors will go after them if they want to.
That's Tommy Wilkes from Reuters, their European finance editor, with me.
The British Prime Minister, Sakhir Starmer, has become the latest leader from Asia, Europe and North America to go to China for an official visit.
He's due to meet the Chinese leader, President Xi Jinping, on Thursday.
With Donald Trump in the White House.
I wonder whether other world leaders are courting China as a kind of insurance policy.
Let's get analysis from our China correspondent, Laura Bicker.
This is the factory of the world.
Just give you a few examples.
If you're looking at the future of our planet, China is the lead in renewables.
It produces everything from around 60 to 80 percent of electric vehicles solar panels, wind turbines, electric batteries.
China makes more robots than anywhere else in the world.
China has and processes more rare earths. than anywhere else in the world.
About 90% of rare earths, for instance.
And these are these minerals that are needed to make anything from an electric vehicle to your smartphone, to Bluetooth speakers.
And that is one of the reasons why so many countries are flocking here.
And China is saying to all of these countries, look, I'm here, I will offer you a deal.
I think the other thing, China doesn't see alliances in the same way the West does.
It doesn't demand you adopt its ideology.
This to China is a business deal.
It is using trade to gain influence in this great power competition that it's in with Washington.
And this time around, especially if you're looking at a Washington that is more unpredictable, then China can contrast itself and say look, we are a stable global, more reliable partner.
And that is what President Xi Jinping is trying to do now.
And that is one of the reasons why he's extending the arm of friendship to so many of these countries.
And you can hear more of that analysis from Laura in Beijing by searching for BBC News on YouTube and then looking for Global News in the podcast section.
Harry Styles is going to break records at Wembley this summer because he's added more performance dates to his Wembley Stadium gigs in London.
That makes a run of 12 concerts, so he'll overtake Coldplay and Taylor Swift as the artist with the most performances in a single year at that venue.
Taylor Swift's 18th night stint on the Eras tour was the highest number by a solo act so far.
Here's Terry Newman who lectures at the University for the Creative Arts.
Harry's a spectacle and tickets are really expensive.
And when he puts on a show, it's a show like no other.
So all the Harry Styles fans around the world are really looking forward to what's going to happen.
Basically, he's set a new record at London's Wembley Stadium because he's expanding from six to 12 nights, because there's been such an overwhelming demand for tickets to go and see him.
And so he's going to be playing there from sort of June through to the start of July.
And that beats the record for the number of Wembley shows by an artist in a single year.
So more than Taylor Swift and more than Coldplay, who actually set the record last year in 2025.
But what I found quite interesting is he's actually going to go and play a massive 30 days at Madison Square Garden.
So, you know, there is a huge appetite for what Harry's going to be rolling out this year.
I feel very down with the kids today because I spent much of my day queuing for tickets to Harry Styles.
My teenage daughter.
And the last time I did this was for Taylor Swift, when she was breaking the same record at Wembley Stadium.
I went to the Taylor Swift gig myself.
It was absolutely incredible.
Do you think they're designing this around breaking the record?
Does each artist go well?
We'll have to do one more night than the record if we're going to make a headline that way.
Well, I mean, I think The thing about these kind of extended sort of residencies, if you like, it gives, I think you know now, as you know, going to see Taylor Swift already, going to see these big, big stars in concert, is about kind of curating an experience.
And I think having these extended sort of residencies allows the stars to kind of curate a little bit more within the venue.
So I think it's more about kind of upping the ante on the experience, rather.
I mean, maybe you know there's some skepticism there.
But I think the fact is there are people who want to go and see Harry and big stars like Taylor Swift.
And, you know, they are going to be expecting a great show.
And I think doing, you know, not just kind of parachuting in and doing one concert and then shooting off to another part of the country or another part of the world.
It gives the production values, it allows the production values to sort of elevate a bit.
So, I mean, you know, I think it's going to be very excited.
I don't expect you're going to be disappointed if you queued for tickets and have got one.
Absolutely.
And I mean, one thing people are talking about is the price.
You know there are reasonably priced tickets, but also you go on there and there are tickets at you know four five, six hundred pounds, which is difficult for people who really want to go have waited ages in the queue.
They get to the front and then they're presented with tickets that exist but aren't affordable.
I mean, I think that's an ongoing situation, especially when you've got kind of.
You know, Harry Styles is a brand now.
But actually, I mean, I sort of had a look into it.
And the last time Harry played at Wembley, the prices started at £50.
Now they're starting at just over £44.
So, you know.
If you are lucky to grab a ticket, one of the cheaper tickets, they are actually a little bit cheaper than they were a couple of years ago.
But no, I mean, you're right.
It's an expensive sort of habit, hobby.
For fans, it's going to be crazy.
But if you do get to see him on this new tour, I think it's going to be a memory that for fans they won't forget.
A bit like sort of seeing David Bowie as Ziggy Stardust in 1972.
And hopefully we'll be seeing as many amazing outfits as Bowie would have worn then as well.
Because my book Harry Styles and the Closies.
When I wrote it it was a few years ago, but it was clear to me then and now Harry's stage outfits are never just clothes.
They're part of how he sort of builds his community with his audience.
And you know, I think that what he wears will probably be just as talked about as the set list and, dare I say it, the price of the tickets.
Terry Newman from the University for the Creative Arts, online at bbc.com slash news.
More about that US Fed decision to hold rates and which members of the Fed voted which way.
Bbccom slash news.
From me, Andrew Peach, thanks for listening to World Business Report.
