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Amazon (AMZN) said Tuesday that Jeff Bezos, the company’s founder and CEO, would be stepping down from his role in the third quarter of 2021.
Bezos will be transitioning to executive chair of the company. Andy Jassy, who currently leads Amazon Web Services (AWS), is set to take over as CEO of the company, Amazon said in a statement. Jassy has been with the company for nearly 24 years, according to his LinkedIn.
“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,” Bezos wrote in a letter to employees published online. “He will be an outstanding leader, and he has my full confidence.”
“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,” he added. “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.”
Charlie O’Shea, lead retail analyst at Moody’s Investors Services, said Bezos’ departure and replacement with Jassy would be an “absolutely seamless transition.”
“One of the things we’ve learned about Amazon is, there’s an incredibly deep bench there. They’ve turned over CFOs without missing a beat,” O’Shea told Yahoo Finance Live. “It’s not like Jeff Bezos is going to go sailing off into the sunset here. He’s going to be still very much involved in the overall strategy of the company, he’s the largest shareholder. There’s a whole lot of things that will keep him wedded to this company.”
“Andy has done a terrific job of AWS, I mean the numbers bear that out,” O’Shea added. “AWS continues to be the profit engine of the company and supports the retail business as a continuing investment.”
In the fourth quarter, AWS grew revenue 28% to $12.74 billion. That year-over-year growth rate held roughly steady versus the third quarter but slowed over 2019, as the segment matured further as the U.S. market share leader in cloud web hosting. And AWS operating income grew even more strongly, jumping 37% to nearly $3.6 billion.
The announcement of Bezos’ departure came in tandem with Amazon’s fiscal fourth quarter earnings results, which handily topped expectations. The e-commerce giant reported earnings of $14.09 per share on record revenue of $125.56 billion, compared to consensus estimates for $7.34 per share on revenue of $119.70 billion, according to Bloomberg data.
Shares of Amazon fluctuated between gains and losses in late trading Tuesday.
Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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