MW Amazon and Pinterest are slashing jobs, yet corporate America's profit margins are racing toward 15-year highs

By Bill Peters

Earnings Watch: Fourth-quarter margins are soaring, but fresh job cuts are raising deeper career questions. With Amazon and Alphabet leading a massive earnings week, analysts are focused on hiring decisions and AI adoption.

Amazon reports quarterly results on Thursday.

Fourth-quarter results so far have shown that corporate America can still afford to hire people. But maybe, in more cases, it's just choosing not to.

Even as consumers worry about higher living costs, AI encroachments, and an economy emitting mixed signals, S&P 500 companies' profit margins are cruising toward their highest levels in more than 15 years, according to a new report, as big companies like Amazon.com Inc. lay off thousands.

That report, released by FactSet on Friday, said that based on fourth-quarter results so far, the collective net profit margin for S&P 500 companies was trending at around 13.2%, helped as ever by cost cuts in an AI-focused big-tech industry. If that figure holds, it would be the highest net-margin figure since the firm began tracking it in 2009.

The report was published ahead of a jam-packed earnings slate this week, led by results from none other than Amazon (AMZN) itself. And it follows a week marked by some high-profile job cuts from the e-commerce giant, Pinterest Inc., Peloton Interactive Inc. and others.

The margin figure also lands as Wall Street weighs potential threats like tariffs, a "no-hire, no-fire" job market and geopolitical turmoil. But some have said the year ahead could bring potential benefits, like interest-rate cuts, bigger tax refunds and other tax breaks.

The big banks, during their quarterly results in January, said that consumers, overall, were fine. Wall Street will see about that, as 127 S&P 500 companies prepare to report quarterly results this week, according to FactSet. Some analysts have said they would be focused what companies might say about their hiring plans, as executives try to show that they're keeping up with developments in artificial intelligence.

Amazon reports results on Thursday, as tariffs show signs of nudging prices higher in its online-shopping business, and as analysts look for continued growth in its large cloud-computing segment. Big-tech peer Alphabet Inc. $(GOOGL)$ reports a day before that.

Elsewhere, Walt Disney Co. $(DIS)$, Tyson Foods Inc. $(TSN)$, Palantir Technologies Inc. (PLTR), Chipotle Mexican Grill Inc. $(CMG)$ and Uber Technologies Inc. (UBER) report during the week.

Amazon last week said it would cut 16,000 jobs, following a bigger push toward AI in within its corporate ranks, as it plans to spend billions on the technology. Pinterest Inc. this week said it expected to cut "less than 15%" of its staff in an effort to focus more on AI-driven products.

Elsewhere, United Parcel Service Inc. (UPS) is laying off more people, as it pulls back from Amazon deliveries. Nike Inc. $(NKE)$ during the week said it would cut hundreds of jobs in an automation push. Home Depot Inc. $(HD)$ also said it was trimming staff and ordering corporate employees back to the office for five days per week, according to reports. Peloton Interactive Inc. (PTON) has cut 11% of its staff, the fitness company confirmed, after Bloomberg reported the news on Friday.

Jason Schloetzer, a business professor at Georgetown University, said in an interview that tech companies were still shrinking staff after bulking up during the pandemic. And he noted Amazon's decision to close its Amazon Fresh and Amazon Go physical stores.

He also said that entry-level, front-line employees might still need to interact with customers, potentially sparing them from being displaced by AI. But at corporations' mid-level ranks, he said, more companies were finding ways to use AI to help gather data, generate initial thoughts on it, analyze reports, and follow accounting protocols.

"They still need to, in Amazon's example, be involved in logistics and fulfillment," he said. "But the mid-level people who oftentimes have been promoted up into roles where it's much more oversight and management and judgment and decision-making, it does does seem like companies are starting to see some gains where [they] can do more with less."

Concerns remain about an AI bubble and big tech's colossal investments in AI infrastructure, and the technology still spews out reams of inaccurate information. But AI's advance has raised bigger questions about what company org charts might look like in the future, and how mid-level, mid-career employees might move up the corporate ladder.

Jo-Ellen Pozner, a professor of management at Santa Clara University, also said AI was likely coming for lower-level, white-collar jobs.

"If AI can take care of a lot of the functions that people have had to take care of - like, for example, in entry-level bookkeeping jobs - it's not clear that there are higher-level jobs available to the people who were employed in those positions," she said. "One: because they might not have the skills, and two: because those jobs might just might not exist."

-Bill Peters

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February 01, 2026 10:00 ET (15:00 GMT)

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