- Andy Jassy predicts AI will flip retail from 80–85% in stores to predominantly online, accelerating store closures.
- Amazon’s AI assistant Rufus drives strong engagement, boosting purchases and projected to add over $10B annualized sales.
- Amazon reorganizes for agility amid layoffs, betting AWS, Rufus, and agentic commerce will outcompete traditional brick-and-mortar.
In a stark prediction during Amazon’s Q3 earnings call, CEO Andy Jassy laid out how artificial intelligence is set to upend the retail world.
Physical stores still rule today, but not for long. “I still think if you look at the worldwide market segment share of retail, still 80% to 85% of it lives in physical stores,” Jassy said.
“And that equation is going to flip over time. And I think AI is going to only accelerate that.”
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The comments came as Amazon posted blowout results: revenue soared 13% to $180.2 billion, with AWS surging 20%—its fastest growth since 2022—fueled by AI demand.
Online store sales hit roughly $67 billion, up double digits, while physical stores like Whole Foods and Amazon Fresh grew to $5.58 billion, a more modest 7% bump.
Rufus Powers Up Shopping—with Real Results
Jassy spotlighted Rufus, Amazon’s AI shopping sidekick, as proof of AI’s retail muscle.
“Rufus, our AI-powered shopping assistant has had 250 million active customers this year with monthly users up 140% year-over-year, interactions up 210% year-over-year and customers using Rufus during a shopping trip being 60% more likely to complete a purchase.
Rufus is on track to deliver over $10 billion in incremental annualized sales.”
That’s less than 1% of Amazon’s massive retail volume, but the trajectory screams potential—especially as features like personalized recommendations keep rolling out.
The Agentic Future: AI Agents Take the Wheel
Peering further ahead, Jassy got fired up about “agentic commerce,” where AI agents handle the heavy lifting of shopping decisions.
“I’m very excited about — and as a business, we’re very excited about in the long term the prospect of agentic commerce.”
He painted a picture: Customers unsure what to buy head online, where AI narrows endless options better than any store clerk.
Amazon’s already testing this with Rufus and “Buy for Me,” plus eyeing partnerships. The goal? Make online shopping smoother than in-person, pulling even more traffic to digital.
Social media users have called the process a sort of ‘brainwashing’ — letting AI determine what groceries to get you, dumbing down the consumer.
Layoffs Aren’t About AI or Cash—It’s ‘Culture’?
Timing these visions with tough news: Amazon slashed 14,000 corporate roles this week. Jassy pushed back hard on assumptions.
“The announcement that we made a few days ago was not really financially driven and it’s not even really AI-driven, not right now, at least. It really — its culture.”
He explained the buildup: “If you grow as fast as we did for several years… you end up with a lot more layers. And when that happens, sometimes without realizing that you can weaken the ownership… and it can lead to slowing you down.”
The fix? “We are committed to operating like the world’s largest start-up.” Fewer layers, more frontline power—pure agility for the AI race.
This echoes his pre-earnings memo: “We’re convinced that we need to be organized more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business.”
Brick-and-Mortar: Amazon’s Own Mixed Bag
Amazon knows physical retail inside out—owning Whole Foods since 2017 and rolling out Amazon Fresh.
Grocery alone topped $100 billion in annual sales. But experiments like cashierless Just Walk Out stores got dialed back after slow uptake.
Jassy sees stores as a “significant opportunity” now, but AI tilts the scales online. Same-day delivery’s exploding to 2,300 U.S. cities by year-end, chipping away at the weekly supermarket run.
Grocers have even begun to close down stores.
Walmart’s partnering with ChatGPT, but Amazon’s AWS edge and Rufus head start position it to own agentic shopping.
Shares jumped post-call, with Q4 guidance at $206-213 billion. Jassy’s bet: AI doesn’t just help Amazon—it buries the old retail guard faster.
Also Read: A Sporting Goods Retailer is Now Closing Over 100 Stores
Htos1av
November 2, 2025“Vertical” intergration” as loved in power structures and gov’ts IS an homage TO babylonians of old as in a tower of babble……it has to FINALLY end forever.