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Amazon's cloud unit chief to step down after three years

By Akash Sriram and Greg Bensinger

(Reuters) -The chief of Amazon.com's wildly profitable Amazon Web Services cloud computing unit will step down next month after a three-year term, the company said on Tuesday.

Adam Selipsky, 57, who is also a member of Amazon's team advising CEO Andy Jassy, will leave the company on June 3. He will be replaced by Matt Garman, a senior vice president who has overseen sales and marketing at AWS.

Selipsky has spent 14 years at AWS over two stints. He was the CEO of Tableau Software, a unit of Salesforce, from 2016 to 2021, when he was tapped to take over the division from Jassy who had been appointed Amazon CEO.

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Under Selipsky's leadership, AWS saw rapid growth, doubling sales of $45.4 billion from the year before his appointment to $90.8 billion in 2023 and nearly doubling operating income to $24.6 billion over that period.

Still, AWS has faced criticism that it has not been fast enough to roll out competitive generative artificial intelligence services to meet the challenge presented by competitors, including OpenAI. It recently made its Amazon Q chatbot service broadly available for businesses.

Shares in the Seattle retailer were little changed on Tuesday, down less than 1%.

“I don’t think it will be very disruptive at all," said Jamie Meyers, senior analyst at Laffer Tengler Investments, which owns Amazon shares.

"The key player for AWS always has been Andy Jassy, who founded and led the unit until three years ago. So long as he is still at the helm of the company, AWS operations should continue according to plan."

It was not immediately clear what Selipsky may do next, though he said he was leaving the company to "spend more time with family."

While AWS has the largest share in the U.S. cloud market, its dominance is under pressure from Microsoft's fast-growing Azure service that is benefiting from AI offerings powered by its tie-up with OpenAI. And Alphabet's Google is expected to roll out new AI services on Tuesday at its annual developer conference.

AWS, Amazon's second-biggest business unit after e-commerce, is widely regarded as the company's growth engine, contributing about 40% to its top line.

Garman started at Amazon as an intern during the summer of 2005 and joined the company full-time the next year as one of its first product managers.

Selipsky also led AWS through several rounds of layoffs, including a few hundred jobs in April in the unit overseeing sales and marketing for physical stores technology. AWS was among the hardest hit divisions in 2023 when Amazon trimmed around 27,000 jobs across the company.

(Reporting by Greg Bensinger in San Francisco; Akash Sriram in Bengaluru; Editing by Pooja Desai, Michael Erman and Marguerita Choy)