Jeff Bezos, billionaire founder of Amazon, will step down as chief executive, the company announced on Tuesday.
Bezos, who will remain executive chair, will hand the reins to Andy Jassy, chief executive of Amazon Web Services, the company’s fast-growing cloud computing business.
The surprise news came as Amazon released its latest financial results. Few companies have thrived like Amazon during the coronavirus pandemic, and in the last three months of the year, the company recorded sales of more than $100bn for the first time.
Bezos, 57, founded Amazon in 1994 and built it into one of the largest companies in the world, amassing a fortune of $185bn. Amazon, which started as an online bookseller, is now a dominant force in cloud computing, groceries, electronics and entertainment, and employs more than 1.1 million people.
“Amazon is what it is because of invention,” said Bezos. “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.”
Bezos has stepped back from the day-to-day running of Amazon in recent years to pay more attention to his other interests, including space exploration and his ownership of the Washington Post. But his departure as chief executive was unexpected.
Jassy, 52, has long been seen as Bezos’s heir apparent, vying with Jeff Wilke, who ran Amazon’s retail business until he announced plans to retire last year.
Amazon Web Services (AWS) – which provides cloud computing and storage for governments and companies including McDonald’s and Netflix – has become one of the company’s most important businesses, accounting for 10% of sales in the last quarter and 52% of the company’s profits.
The company had a “record-breaking holiday season” last year, Amazon said, reporting sales of $125.56bn, its largest quarter of all time.
The leadership change comes at a strange time for Amazon. While profits continue to surge, it faces pressure from workers who have complained of mistreatment during the pandemic, and increasing political scrutiny of the size and power of its business – not least at AWS.
Last month, AWS declined to host Parler, a would-be Twitter rival popular with Donald Trump supporters, which became a communication hub for the rioters who stormed the US Capitol.
Last year, the US Congress grilled Bezos and other top tech executives over the size of their businesses.
“These companies, as they exist today, have monopoly power,” said David Cicilline, chair of the House judiciary committee’s antitrust subcommittee. “Some need to be broken up, all need to be properly regulated and held accountable. This must end.”
Tim Hubbard, assistant professor of management at the University of Notre Dame’s Mendoza College of Business, said: “Andy Jassy stepping into the CEO role at Amazon is a natural fit. Amazon Web Services is a powerhouse within the company, driving a lot of profitability.
“This transition may free up Bezos to focus on other ideas that he’s been accumulating over the years. In one way, I think it might be freeing for him to have the space to personally innovate again, without having to manage the rest of the company.”
Hubbard added: “Given the recent successes at Amazon, especially during the pandemic, it’s going to be hard to disrupt their momentum.”