(Bloomberg) – Amazon.com Inc.’s cloud unit plans to hire employees over the next year and continue to build new data centers, a sign that a hiring freeze elsewhere at the company hasn’t dashed investment plans for its most profitable business .
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Amazon earlier this month introduced hiring restrictions across all business groups, suspending recruitment except in specific areas or with senior management approval. The company also plans to cut about 10,000 jobs, Bloomberg reported. But Matt Garman, a senior vice president who oversees Amazon Web Services’ sales and marketing teams, said he expects both his organization and the broader AWS business to hire staff in 2023.
“I expect we’ll actually be hiring a little more over the next year,” Garman said Tuesday in an interview on the sidelines of AWS’ re:Invent conference in Las Vegas. “Our business is still growing rapidly.”
Revenue at Amazon’s cloud unit, the largest provider of leased data storage and computing power, totaled $20.5 billion for the three months ended September, up 27%. That rate, however, is the slowest year-over-year growth since Amazon began disaggregating the division’s performance in 2014, as some companies sought to rein in technology spending or make cutbacks to weather an economic downturn.
Before Amazon’s leadership team made the decision to freeze the hiring, AWS executives had been debating imposing their own restrictions, talks that were being held independently of the poor economic outlook, Garman said. Amazon has historically shifted from phases of investing to self-imposed frugality to stave off corporate bloat.
“We went through a couple of years where we just couldn’t make it,” Garman said. “Honestly, it was about time.”
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“We’re on a break and I actually think our teams are all embracing it,” he added. “We’ve grown so quickly that from an organizational perspective, it’s often healthy to have a period of digestion.”
The teams Garman leads have handled much of AWS’s hiring over the past few years as the company ramped up the sales force needed to win contracts with large corporations and government agencies. “We’ve scaled very quickly over the past few years because we started from scratch,” Garman said. “I think at that point we did a pretty good job there. I think we’re still smaller than some of our competitors, but not as many of them.”
AWS has long been a profit engine, sometimes making up all of the parent company’s operating income. But as growth in this business slows, some have questioned the pace of Amazon’s investment in the cloud. In an earnings call in October, after Amazon forecast its slowest-ever growth for a holiday quarter, a financial analyst asked whether the company might be curbing spending on new AWS data centers.
“We will moderate our data center growth as demand slows,” Garman said in the interview. “We have a lot of supply chain models that tell us to keep building data centers, so we’re going to keep building them.”
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