In what would be his last shareholder meeting as CEO, Jeff Bezos announced that he would be formally stepping down as CEO of Amazon on July 5. The same date Amazon was incorporated 27 years ago. He will instead move into the role of executive chairman while the CEO role would be filled by Andy Jassy who currently heads Amazon Web Services.
The announcement was first made in February in the company’s earning’s reports that month. And Jassy was to take over as CEO in the Third fiscal Quarter with no specific date given.
“I’m very excited to move into the [executive] chair role, where I’ll focus my energies and attention on new products and early initiatives,” Bezos said Wednesday. This follows the February announcement where he was looking forward to have more time to work on other ventures like Blue Origin and Bezos Earth Fund.
He also backed incoming CEO And Jassy saying:
“He has the highest of high standards and I guarantee Andy will never let the universe make us typical. He has the energy needed to keep alive in us what has made us special.”
Jassy will in turn be replaced by Tableau CEO Adam Selipsky who will also take over as head of Amazon Web Services on July 5.
Innovation and Risks
Bezos was also questioned on whether the company’s size would impede innovation as is the case for most behemoths. He acknowledged that new CEO Andy Jassy would have to navigate the company through new challenges.
New bets like the Project Kuiper satellite network and Amazon Care telehealth services were not guaranteed to succeed.
“Let me assure you, I can guarantee you that none of these ideas are guaranteed to work,” he said. “All of them are gigantic investments and they’re all risks…The only way to get above average returns is to take risks and many won’t pay off. Our whole history as a company is about taking risks, many of which have failed and many of which will fail but we continue to take big risks.”
Shareholders went on to vote down on all 11 proposals submitted by outsiders. These spanned various topics ranging from Amazon’s hiring practices, worker safety, climate change and the use of facial recognition.
Bezos was further questioned on the criticism that the company had grown too big and too powerful that many even call it a monopoly. He pushed back against this by citing that Amazon still faces stiff competition especially from the retail sector where the market continues to thrive.
“Consumers can shop at dozens of large national retailers, hundreds of regional retailers, hundreds of thousands of small retailers both online and in store. It’s a very healthy industry and far from a winner-takes-all situation and we are still a small fraction of retail.”
In regard to its cloud computing division Amazon Web Services dominance, Bezos responded by pointing out that Amazon faces “…competition from well established companies like Google, Oracle and Microsoft and from new, incredibly successful upstarts doing a great job and growing incredibly quickly. Like Snowflake and Twilio.”
This criticism comes in the wake of a lawsuit filed by the Attorney General of Washington for allegedly ‘engaging in anticompetitive practices that have unfairly raised prices for consumers and suppressed innovation.’
Bezos offered a rebuttal to this argument by pointing out that there are markets where consumers have far fewer choices. He gave an example where he challenged his audience to name ‘any successful small, fast-growing mobile phone operating system.’ And sure enough, there is none.
Also on the agenda was Amazon’s recent acquisition of MGM Studios for a whopping $8.45 billion. The deal was announced just hours before the shareholder meeting.
The Hollywood studio is behind major hits such as James Bonds films, “Raging Bull”, “Thelma and Louise”, “The Handmaid’s Tale” and “Robocop”. The acquisition would be a much-needed boost for Amazon which, despite hits such as “Manchester by the Sea”, still falls behind established players like Netflix and Disney.
Explaining the deal Bezos said, “MGM has a vast deep catalogue of much-beloved intellectual property. And with the talented people at MGM and Amazon Studios, we can re-imagine and develop that IP for the 21st century. It’s going to be a lot of fun work and people who love stories are going to be the biggest beneficiaries.”