Observed Signal · Nov 22, 2022 · Business Update · Source: Trending Topics · Impact: 2/5 · Sentiment: Negative
Report: Amazon's Alexa Set to Lose $10 Billion in 2022
According to a Business Insider report, Amazon's Alexa voice assistant business is heading for losses of about $10 billion in 2022. The Worldwide Digital division, which includes Alexa and Prime Video, lost $3 billion in Q1 2022. Eight years after launch, Amazon has not established a viable business model for Alexa. Devices are sold at cost or below, and users mostly ask simple questions instead of shopping. In the US, Alexa's 71.6 million users lag behind Google Assistant's 81.5 million and Apple's Siri's 77.6 million. Internally, the unit is described as being in crisis and a 'colossal failure.' Amazon reportedly plans 10,000 layoffs, many in the Alexa division. Alexa's technology is based on Polish startup Ivona, which Amazon acquired; the team became Amazon Development Center Poland.
Highlights persistent monetization challenges of voice assistants and Amazon's potential strategic retreat from Alexa, affecting emerging voice commerce and conversational ad channels.
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Key Takeaways & Evidence Grounding
- Amazon's Worldwide Digital division, including Alexa, lost $3 billion in Q1 2022.
- Alexa losses are projected to total $10 billion in 2022.
- Alexa has 71.6 million US users, behind Google Assistant (81.5 million) and Apple's Siri (77.6 million).
- Amazon reportedly plans to lay off 10,000 employees, with many cuts expected in the Alexa division.
- Alexa is based on technology from Polish startup Ivona, which Amazon acquired.
Connected Companies & Entities
5 Entities mapped“E-Commerce-Riese Amazon fährt mit Alexa einem Bericht von Business Insider zufolge Milliardenverluste ein....”
“einem Bericht von Business Insider zufolge...”
“Das Startup fand nach mehreren Jahren Kund:innen in Nordamerika wie BlackBerry oder Barnes & Noble....”
“Alexa ist in den USA hinter Googles Assistant und Apples Siri zurück gefallen....”
“hinter Googles Assistant und Apples Siri...”
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