san franciscoAmazon Alexa is reportedly on pace to lose $10 billion this year as the voice assistant has never managed to create an ongoing revenue stream.
Amazon is currently undergoing one of its biggest layoffs ever with plans to eliminate 10,000 jobs across the company.
According to Business Insider, one of the hardest hit areas is the Amazon Alexa voice assistant unit, which is losing favor with the e-commerce giant.
The group suffered a loss of $3 billion in the first quarter of 2022 itself.
The report says the hardware team is on pace to lose $10 billion this year.
One former employee described Alexa as a “colossal failure of imagination” and “a wasted opportunity,” according to the report.
Jeff Bezos reportedly lost interest in the project in 2020, and new CEO Andy Jassy is less protective of Alexa.
The report claims that Amazon’s Echo line is doing well, but most of the devices are selling at a loss.
One document reportedly states that the business model makes money when people use the devices rather than buy them.
However, by the experiment’s fourth year, most people were only using Alexa for trivial commands like playing music or asking about the weather, the report said.
The plan ultimately failed because those questions didn’t lead to monetization.