After manoeuvring Amazon to a $1.7 trillion market cap, Jeff Bezos steps down

During Q4, Amazon’s revenues surged 44% Y/Y and EPS more than doubled, driven by strong holiday season and strength in cloud business. Amazon’s AWS revenues climbed 28% Y/Y to $12.7 billion (10% of total sales), while operating income increased 37% Y/Y to $3.56 billion, contributing 52% of the company’s total operating income.

In FY20, revenue rose 38% Y/Y to $386.1 billion, easily beating our revenue growth estimate of 35%. Net income came in at $21.3 billion in FY20, translating to $41.83 per share – comfortably beating our EPS estimate of $34 – up from $11.6 billion and $23.01 a year ago.

While delivering a blowout quarter, Amazon announced that its founder and CEO Jeff Bezos will step down from his current role and transition into an executive chairperson position. AWS’s current CEO Andy Jassy – who was always seen as a potential successor to Bezos – will be taking over.

Jassy, who joined the company in 1997, built Amazon’s AWS business from the ground and it now boasts a dominant 30% market share of the cloud computing market. The AWS business sales surged 30% Y/Y to $45 billion in 2020, with its operating profits representing more than 60% of the total operating income of the company.

As Jeff Bezos signs off, he wrote to his employees – “Keep inventing, and don’t despair when at first the idea looks crazy. Remember to wander. Let curiosity be your compass. It remains Day 1,”


– Merlyn Sushmitha
Sr.Research Analyst

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