KEY POINTS
Amazon CEO Jeff Bezos will step down later this year, turning the helm over to the company’s top cloud executive Andy Jassy.
Jassy joined Amazon in 1997 and has led Amazon’s Web Services cloud team since its inception.
Bezos said he will stay engaged in important Amazon projects but will also have more time to focus on the Bezos Earth Fund, his Blue Origin spaceship company, The Washington Post and the Amazon Day 1 Fund.
Amazon CEO Jeff Bezos will step down later this year, turning the helm over to the company’s top cloud executive Andy Jassy, the company announced Tuesday. Bezos will transition to executive chairman of Amazon’s board. Bezos founded Amazon in 1994 and has since morphed the one-time online bookstore into a mega retailer with global reach in a slew of different categories from gadgets to grocery to streaming. Amazon surpassed a $1 trillion market cap under Bezos’ leadership in January of last year — it’s now worth more than $1.6 trillion.
Shares of Amazon were up about 1% in extended trading on Tuesday on the back of the earnings report and the C-suite news. The company’s stock has gained about 4% so far in 2020 and is up nearly 70% in the last 12 months. The company had kept its succession plans quiet, though onlookers speculated that Jassy would be his successor. Jassy joined Amazon in 1997 and has led Amazon’s Web Services cloud team since its inception. AWS continues to drive much of Amazon’s profit.
“I’m excited to announce that this Q3 I’ll transition to Executive Chair of the Amazon Board and Andy Jassy will become CEO,” Bezos said in a letter to employees. “In the Exec Chair role, I intend to focus my energies and attention on new products and early initiatives. Andy is well known inside the company and has been at Amazon almost as long as I have. He will be an outstanding leader, and he has my full confidence.” The news came alongside an earnings report in which Amazon posted its first $100 billion quarter. AWS, under Jassy, reported 28% revenue growth for the fourth quarter. About 52% of Amazon’s operating income was attributed to AWS as of October 2020.
Amazon chief financial officer Brian Olsavsky said on the company’s earnings call that the executive change was decided in consultation with Amazon’s board of directors. He said Bezos will remain very involved and have his fingerprints on lots of different parts of the company. He said Jassy is a visionary leader who will bring his own skillset but that Amazon expects a lot of continuity with the transition.
Jassy will need to guide the company through antitrust concerns once he takes the reins. In October, after a 16-month investigation into competitive practices at big tech companies including Amazon, the House Judiciary subcommittee on antitrust concluded that Amazon, Apple, Facebook and Google enjoy monopoly power. Amazon is also facing antitrust complaints in the EU. Bezos said he will stay engaged in important Amazon projects but will also have more time to focus on the Bezos Earth Fund, his Blue Origin spaceship company, The Washington Post and the Amazon Day 1 Fund.
“As much as I still tap dance into the office, I’m excited about this transition,” Bezos said in his internal announcement. “Millions of customers depend on us for our services, and more than a million employees depend on us for their livelihoods. Being the CEO of Amazon is a deep responsibility, and it’s consuming. When you have a responsibility like that, it’s hard to put attention on anything else.”
Here’s the full letter from Bezos to Amazon employees:
Fellow Amazonians:
I’m excited to announce that this Q3 I’ll transition to Executive Chair of the Amazon Board and Andy Jassy will become CEO. In the Exec Chair role, I intend to focus my energies and attention on new products and early initiatives. Andy is well known inside the company and has been at Amazon almost as long as I have. He will be an outstanding leader, and he has my full confidence.
This journey began some 27 years ago. Amazon was only an idea, and it had no name. The question I was asked most frequently at that time was, “What’s the internet?” Blessedly, I haven’t had to explain that in a long while. Today, we employ 1.3 million talented, dedicated people, serve hundreds of millions of customers and businesses, and are widely recognized as one of the most successful companies in the world.
How did that happen? Invention. Invention is the root of our success. We’ve done crazy things together, and then made them normal. We pioneered customer reviews, 1-Click, personalized recommendations, Prime’s insanely-fast shipping, Just Walk Out shopping, the Climate Pledge, Kindle, Alexa, marketplace, infrastructure cloud computing, Career Choice, and much more. If you get it right, a few years after a surprising invention, the new thing has become normal. People yawn. And that yawn is the greatest compliment an inventor can receive.
I don’t know of another company with an invention track record as good as Amazon’s, and I believe we are at our most inventive right now. I hope you are as proud of our inventiveness as I am. I think you should be. As Amazon became large, we decided to use our scale and scope to lead on important social issues. Two high-impact examples: our $15 minimum wage and the Climate Pledge. In both cases, we staked out leadership positions and then asked others to come along with us. In both cases, it’s working. Other large companies are coming our way. I hope you’re proud of that as well.
I find my work meaningful and fun. I get to work with the smartest, most talented, most ingenious teammates. When times have been good, you’ve been humble. When times have been tough, you’ve been strong and supportive, and we’ve made each other laugh. It is a joy to work on this team.
As much as I still tap dance into the office, I’m excited about this transition. Millions of customers depend on us for our services, and more than a million employees depend on us for their livelihoods. Being the CEO of Amazon is a deep responsibility, and it’s consuming. When you have a responsibility like that, it’s hard to put attention on anything else. As Exec Chair I will stay engaged in important Amazon initiatives but also have the time and energy I need to focus on the Day 1 Fund, the Bezos Earth Fund, Blue Origin, The Washington Post, and my other passions. I’ve never had more energy, and this isn’t about retiring. I’m super passionate about the impact I think these organizations can have.
Amazon couldn’t be better positioned for the future. We are firing on all cylinders, just as the world needs us to. We have things in the pipeline that will continue to astonish. We serve individuals and enterprises, and we’ve pioneered two complete industries and a whole new class of devices. We are leaders in areas as varied as machine learning and logistics, and if an Amazonian’s idea requires yet another new institutional skill, we’re flexible enough and patient enough to learn it.
Keep inventing, and don’t despair when at first the idea looks crazy. Remember to wander. Let curiosity be your compass. It remains Day 1. Jeff
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