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Amazon founder Jeff Bezos to step down as chief executive, Andy Jassy to take over in the third quarter

Amazon founder Jeff Bezos is to step down as chief executive of the e-commerce giant that he started in his garage nearly 30 years ago.

Amazon CEO Jeff Bezos will leave his post in the third quarter of this year and hand over the empire to the company’s top cloud executive Andy Jassy.

Andy Jassy joined Amazon in 1997 and has led Amazon’s Web Services cloud team since its inception.

Andy Jassy replacing Jeff Bezos

Bezos said he will become executive chairman and will stay involved in important projects. 

The change will take place in the second half of 2021.

In a letter to Amazon staff on Tuesday, Bezos said, “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,” he added.

Amazon shares were up about 1% in extended trading Tuesday on the back of the earnings report and the C-suite news. The company’s stock has gained about 4% so far in 2021 and is up nearly 70% in the last 12 months.

Brian Olsavsky, Amazon’s chief financial officer said on a media 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. Olsavsky said Jassy is a visionary leader who will bring his own skillset but that Amazon expects a lot of continuity with the transition.

Jeff Bezos a higher public profile

Jeff Bezos, 57, started Amazon as an online bookshop in 1994. The firm now employs 1.3 million people globally. The company is involved in everything from package delivery and streaming video to cloud services and advertising. 

Jeff Bezos, a higher public profile

According to Forbes’ list of billionaires, Bezos owns a fortune of $196.2bn. 

Amazon saw its already explosive growth skyrocket last year, as the Covid-19 pandemic prompted a surge in online shopping.

The firm reported $386bn (£283bn) in sales in 2020, which is 38% from 2019. Profits almost doubled, rising to $21.3bn.

Amazon the ultimate winner of Pandemic

 Bezos while announcing the plans said, “he would continue to focus on new products and early initiatives. When you look at our financial results, what you’re actually seeing are the long-run cumulative results of invention. Right now I see Amazon at its most inventive ever, making it an optimal time for this transition.”

The decision came up because Bezos has taken on a higher public profile in the last few years. He has endured a public divorce, become a target for labor and inequality activists, and poured his wealth into other businesses, such as space exploration firm Blue Origin and the Washington Post newspaper.

Jassy the future CEO

Jassy has an MBA from Harvard Business School. He joined Amazon in 1997, according to the company’s website. Jassy founded Amazon Web Service (AWS) and grew it to a cloud platform that millions of people use today.

Andy Jassy the future CEO

Tom Johnson, chief transformation office at Mindshare Worldwide, said Jassy’s promotion underscored the importance of web services to Amazon’s future.

He further said, “Jassy’s background in steering AWS shows how those services at the top priority of Amazon’s business strategy. It will be interesting to see how that affects their strategy and balancing the priority with a growing ad business and commerce behemoth.”

Jassy’s AWS, a bright spot, fell slightly short of the expectations. Though the cloud computing division has announced deals with the BMW group, ViacomCBS, and others, it posted revenue of $12.7 billion, short of the expected revenue of $12.8 billion.

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.

Industry CEOs and Amazon competitors congratulated Bezos and Jassy on the coming transition, with Microsoft CEO Satya Nadella calling Jassy’s promotion “well-deserved.”

Alphabet CEO Sundar Pichai offered Bezos “best wishes” on his other projects.

Read 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. The 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 to 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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