E-commerce

Amazon CEO Jeff Bezos stepping away into new role

Photo by istock.com

February 3, 2021

Amazon CEO and founder Jeff Bezos, the world's second richest person, is moving into the role of executive board chair come Q3 and Andy Jassy is moving into the chief executive role for the e-commerce giant.

The move, announced in a financial earnings release and a letter to employees late Tuesday, caught many off guard, but Amazon's earnings results were pretty much expected given the consumer love for e-commerce during the past year due to COVID-19.

"It's truly amazing all the successes he's had and although he's irreplaceable," Edward Jones analyst Brian Yarbrough told the New York Post, "what's probably holding the stock back is how strong the company is now and that he's not leaving."

The leadership move was slotted nearly halfway down in the release and was a short and succinct two paragraphs before financial highlights.

Jassy runs the company's cloud computing division. Bezos founded his company in 1994 and took the company public three years later.

"Amazon is what it is because of invention. We do crazy things together and then make 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," Bezos said in the release. "If you do it right, a few years after a surprising invention, the new thing has become normal. People yawn. That yawn is the greatest compliment an inventor can receive. 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."

Here are the highlights regarding Amazon's earnings in its latest quarter:

• Operating cash flow increased 72% to $66.1 billion for the trailing 12 months, compared with $38.5 billion for the trailing 12 months ended Dec. 31, 2019.
• Net sales increased 44% to $125.6 billion in the fourth quarter, compared with $87.4 billion in fourth quarter 2019. Excluding the $1.7 billion favorable impact from year-over-year changes in foreign exchange rates throughout the quarter, net sales increased 42% compared with fourth quarter 2019.
• Operating income increased to $6.9 billion in the fourth quarter compared with operating income of $3.9 billion in fourth quarter 2019.
• Net income increased to $7.2 billion in the fourth quarter, or $14.09 per diluted share, compared with net income of $3.3 billion, or $6.47 per diluted share, in fourth quarter 2019.

For the full year 2020:

• Net sales increased 38% to $386.1 billion, compared with $280.5 billion in 2019. Excluding the $1.4 billion favorable impact from year-over-year changes in foreign exchange rates throughout the year, net sales increased 37% compared with 2019.
• Operating income increased to $22.9 billion, compared with operating income of $14.5 billion in 2019.
• Net income increased to $21.3 billion, or $41.83 per diluted share, compared with net income of $11.6 billion, or $23.01 per diluted share, in 2019.