The conundrum facing Amazon boss Andy Jassy is how to ensure the ecommerce giant maintains its ‘always day one’ ethos of experimentation while cutting costs, closing business lines and delivering the profits investors have come to expect.

Breaking with the tradition of predecessor Jeff Bezos, Jassy opted to join the company’s earnings call once again in an attempt to explain. The answer, as it is across the entire tech sector this year, is artificial intelligence.

There was little time to talk about plans for healthcare or satellite project Kuiper. Jassy’s focus was how AI can improve corporate customer services at Amazon’s AWS cloud-computing unit, a long-term source of high-margin profit.

But first-quarter results illustrate how AI has yet to produce much in the way of rewards for the companies investing most heavily in its future. As Jassy noted in the past, large language models can take billions of dollars to create. Revenues, for now, are nowhere to be seen. AWS sales growth is on a downward trajectory. At 16 per cent year over year it is growing more slowly than rivals Microsoft and Alphabet, though it maintains its market share lead. The operating margin has fallen to a five-year low. Growth is expected to dip again in the current quarter — a forecast that wiped out after-hours gains in the share price.

Amazon might have focused more on the ways machine learning can improve its rapidly expanding advertising business. The success of ads shows the company is right to close other businesses that have failed to perform. Winding down the Halo division, which sells health trackers, makes sense in a saturated market.

There are bolder changes that could be considered. Amazon claims to want to transform customer experiences when entering a sector. But six years after its deal to buy Whole Foods, it is hard to argue that life has changed for many grocery customers. If Jassy is in the mood for cuts, why not reassess physical stores altogether.

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