Bezos said today he will be succeeded later this year by Andy Jassy, CEO of Amazon’s hugely profitable Amazon Web Services cloud computing unit. Meanwhile, Amazon announced today record sales and profits for 2020, a year in which the coronavirus pandemic caused a surge in online sales.

Jeff Bezos is going out on a high note.

The founder of Amazon.com Inc. announced today he will give up the post of CEO he’s held since launching Amazon in 1994, at the same time as Amazon reported blockbuster results for 2020—a year in which the COVID-19 pandemic produced a huge spike in online shopping.

In a news release accompanying the earnings report, Amazon announced that Bezos will step down from his CEO post in the third quarter of this year and move into the post of executive chairman. He will be replaced as CEO by Andy Jassy, the CEO of Amazon Web Services, the cloud computing business unit that generated just under 60% of Amazon’s operating income in 2020.

“Amazon is what it is because of invention,” Bezos said in a prepared statement. He then listed such Amazon innovations as 1-click checkout, Kindle, Prime’s fast shipping promise and Alexa.

“If you do it right, a few years after a surprising invention, the new thing has become normal,” Bezos said. “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.”

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The financial results for the fourth quarter of 2020 and the full year were indeed impressive and exceeded Amazon’s projections. The company had projected Q4 revenue of between $112 billion and $121 billion but reported revenue of more than $125 billion, an increase of nearly 44% from the prior-year quarter. Q4 revenue from Amazon’s retail ecommerce sites grew 43% year over year, in part because the e-retailer moved its annual Prime Day event into October this year from its usual July time slot because of pandemic-related issues in its fulfillment network.

Amazon also surpassed its net income estimate of between $1 billion and $4.5 billion as it reported earnings of $7.22 billion for the quarter and $21.33 billion for the year, an 84.1% increase over 2019.

Amazon is No. 1 in the 2020 Digital Commerce 360 Top 1000.

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In a call with stock analysts following the earnings release, Amazon chief financial officer Brian Olsavsky said Bezos would focus as executive chairman on major decisions, such as acquisitions and major strategy moves, such as the company’s move into grocery sales.

He also said that Amazon had added 175,000 employees in the fourth quarter and increased its fulfillment warehouse footprint by 50% compared to the same period in 2019. Olsavsky said that Amazon incurred $4 billion in pandemic-related expenses in the fourth quarter and $11.5 billion for all of 2020.

For the fiscal year, ending Dec. 31, 2020, Amazon reported:

  • Net sales of $386.06 billion, a 37.6% increase from $280.52 billion in 2019.
  • Net product sales—revenue from merchandise Amazon owned and sold to consumers—of $215.92 billion, up 34.6% from $160.41 billion in 2019.
  • Net services sales of $170.42 billion, an increase of 41.9% from $120.11 a year earlier. This includes revenue from commissions from outside merchants that sell on Amazon marketplaces, the Amazon Web Services (AWS) cloud computing service and other smaller revenue sources.
  • North American net sales of $236.28 billion, up 38.4% from $170.77 billion in 2019. North America accounted for about 61.2% of total net sales in 2019, or 69.4% of sales excluding AWS.
  • International net sales totaling $104.41 billion, up 39.7% from $74.72 billion in 2019. International accounted for about 27.0% of total net sales in 2020, or 30.6% of sales excluding AWS.
  • Amazon Web Services revenue hit $45.37 billion, up 29.5% from $35.03 billion a year earlier. AWS sales accounted for 11.8% of 2020 consolidated revenue. AWS earned $13.53 billion in operating income, or 59.1% of the $22.90 billion in consolidated operating income Amazon reported for the year.
  • Other revenue–largely coming from Amazon’s growing advertising business–totaled $21.48 billion, up 52.4% from $14.09 billion in 2019.
  • Revenue from subscriptions, including Prime fees, was $25.21 billion, up 31.2% from $19.21 billion in 2019.
  • Net income of $21.33 billion, up 84.1% from $11.59 billion in 2019.
  • Spending on fulfillment increased 45.5% to $58.52 billion, up from $40.23 billion in 2019.
  • Spending on marketing increased 16.6% to $22.01 billion, up from $18.88 billion in 2019.
  • Spending on technology and content, including fees for licensing content for its Amazon Video service, increased 19.0% to $42.74 billion, up from $35.93 billion in 2019.
  • General and administrative spending increased 28.2% to $6.67 billion, up from $5.20 billion in 2019.

For the fourth quarter, ending Dec. 31, 2020, Amazon reported:

  • Net sales of $125.56 billion, a 43.6% increase from $87.44 billion in the same quarter in 2019. Net product sales accounted for $71.06 billion, up 40.6% year over year from $50.54 billion. Net service sales hit $54.50 billion, up 47.7% from the prior year’s $36.90 billion.
  • North American net sales of $75.35 billion, up 40.4% from $53.67 billion in the fourth quarter of 2019. North America accounted for about 60.0% of total net sales in the fourth quarter of 2019, or 66.8% of sales excluding AWS.
  • International net sales totaling $37.48 billion, up 57.4% from $23.81 billion in the fourth quarter of 2019. International accounted for about 29.8% of total net sales in the fourth quarter, or 33.2% of sales excluding AWS.
  • Amazon Web Services revenue hit $12.74 billion during the quarter, up 28.1% from $9.95 billion a year earlier. AWS sales accounted for 10.1% of consolidated revenue in the fourth quarter of 2019. AWS earned $3.56 billion in operating income, or 51.9% of the $6.87 billion in consolidated operating income Amazon reported in Q4.
  • Other revenue, including advertising, totaled $7.95 billion, up 66.4% from $4.78 billion in the same period in 2019.
  • Revenue from subscriptions, including Prime fees, was $7.06 billion, up 34.8% from $5.24 billion in the same period in 2019.
  • Net income of $7.22 billion, up 120.9% from $3.27 billion in the same period in 2019.
  • Spending on fulfillment increased 51.6% to $18.47 billion, up from $12.19 billion in the same period in 2019.
  • Spending on marketing increased 20.0% to $7.40 billion, up from $6.17 billion in the same period in 2019.
  • Spending on technology and content increased 23.7% to $12.05 billion, up from $9.74 billion in the same period in 2019.
  • General and administrative spending increased 39.6% to $1.97 billion, up from $1.41 billion in the same period in 2019.

Percentage changes may not align exactly with dollar figures due to rounding.

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