Amazon registered sales of 125,555 million dollars in the fourth quarter of 2020, 44% more than a year ago and a new billing record. Its net profit reached 7,222 million dollars, 120% more than in the last three months of 2019. The company reported that its founder and CEO, Jeff Bezos, will become CEO in the third quarter of 2021 passing the baton to Andy Jassy, who will become CEO of Amazon.
Bezos has led Amazon from its inception in 1994 to turn the company into a titan of online sales and cloud services through Amazon Web Services (AWS).
“Amazon is what it is because of invention. We do crazy things together and then make them normal. We pioneered customer reviews, 1-Click, personalized recommendations, blazing fast Prime shipping, Just Walk Out shopping, climate commitment, Kindle, Alexa, marketplace, cloud computing and infrastructure, and much more,” he said in a statement.
For her part, Jassy joined Amazon in 1997 and has run AWS since its inception. Bezos said that she will continue to be involved in major Amazon projects, but that she will also have more time to focus on the Bezos Earth Fund, his Blue Origin spacecraft company, as well as the Washington Post and the Amazon Day 1 Fund.
Amazon’s cloud computing business posted revenue growth of 28% in the fourth quarter, falling short of analyst expectations. In this way, AWS billing reached 12.7 billion dollars compared to 9.95 billion the previous year and below the 12.83 billion expected by consensus. This business area represents 10% of Amazon’s total sales.
The electronic commerce giant closed its fiscal year 2020 with net profits of 21,331 million dollars, almost double the 11,588 million invoiced in 2019, thanks to the great boost in online purchases as a result of the covid-19 pandemic. .
During the past 12 months, it billed 386,064 million dollars, 38% more, while the company’s shareholders pocketed 42.64 dollars per title, compared to 23.46 a year ago.
The one in Seattle, Washington, had anticipated that its revenues in the fourth quarter would be between 112,000 and 121,000 million dollars, that is, an increase of between 28% and 38% compared to the same period of 2019. In the last year, its shares accumulate a return of 69% and only in 2021 they rise 4.4%.
The explosion in online shopping due to the pandemic has rocketed Amazon’s turnover over the past year to new records as e-commerce grew by around 50% in 2020. Approximately 40% of online purchases this side of the Atlantic are made at Amazon, according to research firm eMarketer, which helped the company reach a capitalization of more than $1.6 trillion.
Before releasing its accounts, the US Federal Trade Commission fined Amazon $61.7 million for expanding its business by “cheating its workers.”
In 2015, Amazon launched Flex, a package delivery service to challenge FedEx and UPS. To recruit drivers, the company promised to pay them a minimum of $18 to $25 an hour, plus tips. However, according to the FTC, once the service went live in late 2016, the company changed its terms.
That is why regulators are accusing Amazon of beginning to stealthily cut their payments to these drivers by hijacking their tips. According to the FTC, Amazon misappropriated nearly a third of its drivers’ tips “to increase its own profits.”
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