Amazon’s Jeff Bezos passes CEO role to AWS head Andy Jassy

Amazon CEO Jeff Bezos is planning to transition out of his role. 

James Martin/CNET

Amazon CEO Jeff Bezos will step down later this year, turning over the reins of the world’s largest e-commerce company to Andy Jassy, a longtime lieutenant who runs Amazon Web Services. Amazon nested the news in its announcement of fourth-quarter earnings, which beat expectations. 

The transition comes as Amazon navigates a tricky period in its history. The company is reaping huge profits as consumers, locked at home because of the COVID-19 crisis, become more reliant on both e-commerce and online services. That in turn has attracted regulatory scrutiny from lawmakers concerned about the power Amazon has over the retailers who use it as an online storefront. 

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Amazon’s power was on ample display in the fourth quarter. Net income rose to $7.2 billion, or $14.38 a share, from $3.3 billion a year ago. Net sales jumped 44%, to $125.6 billion. Both figures handily beat Wall Street estimates of $7.23 per share in earnings and $119.7 billion in net sales, according to Yahoo Finance. (Amazon had previously forecast sales of between $112 billion and $121 billion.)

Jassy is an experienced Amazon hand, who started with the company in 1997. He shaped AWS from inception and was made head of the division in 2016.

Though not as well known as Amazon’s e-commerce operations, AWS typically accounts for the largest chunk of Amazon’s revenues. It brought in $12.7 billion in net sales in the fourth quarter. AWS provides businesses with database storage and cloud computing services, including support for machine learning and artificial intelligence endeavors.

In a 2019 interview with PBS’ Frontline, Jassy indicated he was aware of the potential for technology to be abused. “If there’s any kind of documented proof of people misusing the technology, we will suspend people’s ability not just to use the technology but to use AWS,” he said, addressing the concerns about law enforcement’s use of facial recognition. The company followed through on the sentiment last month, suspending cloud hosting services to social media platform Parler for failing to moderate content that advocated violence after Parler was used by rioters who stormed the Capitol on Jan. 6.

Amazon headed into the last three months of 2020 having generated enormous profits, even though it spent billions to address logistical problems presented by the coronavirus pandemic, which saw the company struggle to keep up with a surge in orders. Holiday sales were widely projected to lift Amazon’s revenue as e-commerce companies experienced a boost from customers on lockdown.

The company has also experienced difficulty keeping its vast workforce safe from the coronavirus. In October, Amazon said the virus had infected 20,000 US front-line employees, including grocery workers at Amazon-owned Whole Foods Market. The company rolled out safety and testing measures to protect workers.