Amazon plans to reduce employee stock awards after mass layoffs

After mass layoffs, Amazon now reportedly plans to reduce the number of stock awards for employees in 2025. According to Insider, this move signals a potentially major shift in Amazon`s approach to compensation. Citing an internal memo, the report said that Amazon has told managers that employee stock awards, called restricted stock units or RSUs, for 2025 "will be reduced due to the economic climate and company budget". Amazon will reevaluate the 2025 compensation in the first quarter of next year to "plan for stock variation". The "final outlook year" refers to 2025, given the two-year grant cycle that starts next year, according to the report.

The memo also hinted towards a change in Amazon`s pay model that would give staff more cash, "a change that could make up for any potential weakness in its stock price". Amazon shares are currently trading at roughly the same levels seen in 2018 and 2020. "The lack of stock appreciation has caused some employees to complain about the value of their RSU-based compensation. Any move to increase the cash portion of employee pay could address such concerns," the report mentioned. An Amazon spokesperson said the change in Amazon`s pay structure is a possibility, not a definite plan, and its compensation philosophy "remains unchanged". Meanwhile, Amazon has laid off more than 100 employees across its gaming divisions that include Prime Gaming, Game Growth and Amazon Games, as part of ongoing layoffs at the company. In March, the e-commerce giant announced to lay off another 9,000 employees in Amazon Web Services (AWS), Twitch, advertising, and HR. Amazon initially eliminated 18,000 positions in January.