Amazon is Doubling Down on Robots Everywhere it Can

You’ve been called dumb all your life, ridiculed as a loser, but hey, Alexa, who’s laughing now? 

Amazon announced on Wednesday it’s giving a long awaited generative AI-powered update to its smart speaker virtual assistants, which have never been known for their smarts. 

Alexa will have plenty of new robots to keep her company, too: According to a Financial Times report on Wednesday, Amazon is planning to offset the massive costs of building and maintaining AI infrastructure by employing more and more robotics in its warehouse facilities. 

The $2.2 Trillion Start-Up

Amazon is currently operating on two tracks. On one side, as growth in its e-commerce business slows and low-cost rivals eat away at market share, CEO Andy Jassy is orchestrating a massive cost-cutting operation, laying off some 27,000 workers in the past couple of years and significantly slowing plans to expand its warehouse footprint. He says it’s all in a push to make Amazon operate like “the world’s largest start-up.” On the other side, Amazon is betting big on AI — both as a developer of AI software and tools as well as a provider, via Amazon Web Services, of the computing punch needed to power AI.

But AI profitability is still somewhere on the other side of gargantuan investment. In its recent fourth-quarter earnings call, the company said its capital expenditures for 2025 are expected to reach $100 billion — with most of it to be invested in building out AI infrastructure. “We have a lot of demand for AI right now,” Jassy said in a CNBC appearance Wednesday. “If we had more capacity right now, we could monetize it.” 

Fittingly, the company is turning to a robotic workforce in an effort to save a pile of pennies as it spends big on AI:

• According to the FT, Amazon is planning to spend $25 billion this year on making its retail network more efficient, including an investment into warehouse robotics and automation.
• The investments could net $10 billion in annual savings by the end of the decade, according to research from Morgan Stanley analysts. As a blueprint, the company says its most robot-equipped facility — in Shreveport, Louisiana — operates at about 25% less cost than its older facilities, which it says have just one-tenth the robot manpower.

Save the Date: The robot revolution will be coming to your home, too, if Amazon has its way. With its latest virtual assistant upgrade, Alexa+, Amazon is finally bringing the OG homepod into the ChatGPT age, and says AI will make Alexa far chattier and capable of performing “agentic AI” tasks, such as booking a dinner reservation at a local restaurant (though nascent AI agents from other providers have thus far proven somewhat unreliable). The service will be free to Amazon Prime members, and cost $20 a month for everyone else. The previous version of Alexa already proved to be unprofitable for the company, leading to mass layoffs in the division that develops it. We’re not sure how that squares with adding in even more costly AI features, but we’re guessing Alexa+ will be very good at steering conversations toward how you need to buy more toilet paper.