Amazon founder and CEO Jeff Bezos will step down in the third quarter of 2021, and transition to a new role as executive chair of the company's board.
The e-commerce giant on Tuesday announced the departure of its visionary leader during its fourth-quarter earnings call, where it also reported record-setting earnings after the holiday shopping season. Last year, Bezos, who built Amazon from a three-bedroom rental in the Seattle suburbs, became the first person in history to be worth more than $200 billion, according to the Bloomberg Billionaires Index.
In an email sent to Amazon employees, Bezos said he intends to focus on early initiatives and new products in his new role as executive chair. He also stated that the transition would leave him more time for other pursuits, including philanthropic initiatives. "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," said Bezos.
He also took a moment to remark on his company's inventions. "Invention is the root of our success," said Bezos. "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."
Andy Jassy, the current head of Amazon Web Services (AWS), will replace Bezos as CEO. Now the world's largest cloud platform, AWS makes up more than half of the e-commerce giant's operating income. The pandemic only proved to be a further boon for cloud services, as companies shifted to remote work and online shopping. Amazon on Tuesday reported that AWS revenue climbed 28 percent to $12.7 billion in the fourth quarter of 2020, from just under $10 billion for the same quarter a year ago.
The larger company generated a grand total of nearly $126 billion in revenue during the fourth quarter, the largest in its history. For the full year, net sales increased 38 percent to $386 billion in 2020, compared with nearly $281 billion in 2019. All told, 2020 was the most profitable year in Amazon's history.
The restrictions on brick-and-mortar stores and the Covid-19 pandemic itself no doubt fueled Amazon's blowout holiday quarter. Amazon's third-party sellers also boosted their revenue significantly in 2020. The company said that independent businesses saw sales of over $4.8 billion from Black Friday to Cyber Monday in 2020, up 60 percent year over year.
Bezos's departure comes at a time when Amazon--and Big Tech at large--is under historic levels of scrutiny from both consumers and the government. The company faces multiple antitrust lawsuits, including one that alleges it colluded with major U.S. book publishers to fix e-book prices. A 16-month probe into big tech's business practices led by Representative David Cicilline (D-R.I.) concluded last October that Amazon regularly engaged in anti-competitive practices to put smaller companies at a disadvantage.