- Amazon reported Q4 2020 revenue of $125.6 billion and Andy Jassy is succeeding Jeff Bezos as CEO in the third quarter of this year.
On Tuesday, Amazon.com, Inc. (NASDAQ: AMZN) had reported its Q4 2020 results and during the earnings call, Amazon CFO Brian Olsavsky said that founder and CEO Jeff Bezos will be shifting roles from CEO to the executive chair position in the third quarter this year. And Amazon Web Services (AWS) CEO Andy Jassy will become the CEO of Amazon at that time.
Amazon now has 1.3 million employees, of which 500,000 joined in 2020. All of the employees have a $15 per hour starting pay in the U.S., health insurance, 401(k) matching, and upskilling opportunities. In Q4 alone, Amazon hired 175,000 new full and part-time employees compared to 50,000 in Q4 2019.
The Q4 results include $4 billion in COVID related operating costs such as additional employee pay during the holidays, new employee training, course investments in PPE for employees, and enhanced cleaning. And the total COVID related costs for the year was over $11.5 billion. Over 700 employees are being tested every hour and Amazon built hundreds of COVID-19 testing sites in two labs.
The revenue for the quarter was $125.6 billion (up 44% from $87.4 billion in Q4 2019) compared to guidance of $112 billion to $121 billion. Amazon had shifted Prime Day to October instead of Q3 and the company saw strong seasonal holiday demand through Q4 and the peak sales days included Prime Day, Black Friday, and Cyber Monday. The company also saw strong growth in new Prime member sign-ups.
Operating cash flow for the company had increased 72% to $66.1 billion for the trailing twelve months, compared with $38.5 billion for the trailing twelve months ended December 31, 2019. The free cash flow increased to $31 billion for the trailing twelve months, compared with $25.8 billion for the trailing twelve months ended December 31, 2019.
Third-party units had represented 55% of total paid units during the quarter. And Olsavsky also noted that over 570,000 registered attendees participated in the virtual and free reInvent event. As of Q4, AWS is now a $51 billion annualized run-rate operation.
KEY QUOTE:
“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, Prime’s insanely-fast shipping, Just Walk Out shopping, the Climate Pledge, Kindle, Alexa, marketplace, infrastructure cloud computing, Career Choice, and much more. If you do it right, a few years after a surprising invention, the new thing has become normal. 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 cost inventive ever, making it an optimal time for this transition.”
— Jeff Bezos, Amazon founder and CEO
