Jeff Bezos has a formulation about one-way doors and two-way doors—decisions that are irreversible and permanent and those that can always be unwound.
Stepping through what’s almost certainly a one-way door on Tuesday, Bezos said he will resign as chief executive officer of Amazon.com Inc. and become executive chairman later this year. He will hand day-to-day control to Andy Jassy, his longtime head of Amazon Web Services, a swiftly growing division that has almost singlehandedly changed the way companies buy the technology that powers their businesses.
With that comes at least a partial end to one of the most epic runs in modern business history. Yet, Bezos’s move feels, in many ways, natural and even inevitable. Over the last 25 years, the Amazon founder led the company through perhaps the most fertile period of any American business ever.
Amazon was first just an idea at the Wall Street hedge fund D. E. Shaw & Co., where Bezos was a vice president; then it was an online bookseller and high-flying dot-com stock during the late 1990s. Bezos then rescued the company from the internet bust by formulating and guiding new inventions like the Kindle, Amazon Prime and AWS.
Over the last decade, he has piloted Amazon to a US$1.7 trillion market capitalization, where it currently occupies the same rarified trillion-dollar air as Microsoft Corp. and Apple Inc.
Jeff Bezos stepping down as CEO from Amazon
CEO of Amazon, Jeff Bezos is stepping down from his role to executive chairman. Amazon Web Services CEO Andy Jassy is set to replace him. Bloomberg’s Paul Sweeney has the details.
But Bezos’s decision to step down also reflects an uncomfortable reality for one of the wealthiest people in the world: The walls of his highly compartmentalized empire have been crumbling for some time. It’s becoming increasingly difficult to be Jeff Bezos (at least by Bezos’s standards). He presides over a collection of properties that spans not only Amazon but The Washington Post, several philanthropies and a space company, Blue Origin LLC, that lags far behind its chief rival, Elon Musk’s Space Exploration Technologies Corp.
Just consider the ways Bezos’s various assets have collided over the past few years. His ownership of The Washington Post consistently angered the last U.S. president and arguably cost Amazon the Pentagon’s US$10 billion JEDI cloud computing contract, which the Donald Trump-controlled Defense Department awarded to Microsoft. When he travelled to India in early 2020, Prime Minister Narendra Modi declined to meet with him, and a senior official criticized the Post’s coverage of the country.
Union organizers perpetually protest Amazon’s treatment of its blue-collar workforce and periodically show up in front of Bezos’s homes—and once, with gallingly poor judgement, even wheeled out a guillotine. When Bezos and his partner, Lauren Sanchez, started canvassing climate philanthropies last year to begin making the first of US$10 billion in grants from the Bezos Earth Fund, at least some of the organizations were skeptical of Amazon’s relationship with its front-line workers and hesitant to accept Bezos’s largesse.
Many of the criticisms levied against Bezos and his empire are reasonable and can be addressed. But the most constrained resource in Bezos’s web of conflicting business holdings is his own time, and that can’t be easily reconciled. He used to spend part of Wednesdays and weekends at Blue Origin, his Kent, Washington-based space company. But that may no longer be enough. Blue Origin is two years older than SpaceX but so far has little to show for it, despite the fact that Bezos funds the company by selling US$1 billion of his Amazon stock every year.
In January, Blue Origin launched a successful test flight of New Shepard, a rocket that will carry paying tourists to the edge of suborbital space. It hopes to send actual people on a mission this summer, according to a person with knowledge of the company’s plans who asked not to be identified.
The Blue Origin website proclaims, “We are not in a race, and there will be many players in this human endeavor to go to space.” But of course, practically everyone in the space industry, including those at SpaceX and even at Blue Origin, recognizes that Musk is flying literal circles around Bezos. SpaceX regularly flies into orbit and to the International Space Station and just announced plans to take paying civilians into orbit. In his email to Amazon employees on Tuesday, Bezos said stepping down will give him more time to focus on “other passions,” including Blue Origin. “I’ve never had more energy, and this isn’t about retiring,” Bezos wrote.
“I’ve never had more energy, and this isn’t about retiring”
There’s another reason Bezos might want to step back from active duty at Amazon: Things from here out could potentially become a lot less fun. Amazon just cleared US$100 billion in quarterly sales for the first time. Getting to US$200 billion may not be as satisfying an endeavor.
There are complicated, maturing businesses to oversee, like the Amazon Marketplace, with its bevy of dissatisfied merchants who sell on Amazon.com and consistently complain of fraud and unfair competition from overseas sellers. There are also regulatory challenges looming in Washington and Brussels. Several U.S. states, as well as the Federal Trade Commission, are examining Amazon’s conduct, though the status of those investigations is unclear. When Bezos testified virtually last July in front of the U.S. House antitrust subcommittee alongside Tim Cook, Mark Zuckerberg and Sundar Pichai, he did perfectly fine—but looked like he would rather be building rockets or doing just about anything else.
With Jassy, Amazon now has an accomplished and disciplined leader who performs well in the spotlight and presents a somewhat humbler target for Amazon’s political opponents. Jassy was Bezos’s first “shadow,” or technical assistant, at the company. As a new graduate from Harvard Business School, Jassy made his first mark on the founder in the late ‘90s by inadvertently hitting him in the head with a kayak paddle during a recreational game of broomball.
More recently, he has steered AWS to a US$50 billion annual rate of sales, an extraordinary accomplishment for a business that is only 15 years old. Jassy has totally internalized Bezos’s operating philosophy and longtime credos about customer obsession, long-term thinking and the need for constant self-scrutiny and change.
“It’s really hard to build a business that sustains for a long period of time,” Jassy said on the virtual stage at the AWS Re:Invent conference last December. “To do it, you will have to reinvent yourself many times over.”
Bezos promised employees that he intends to stay active at the company and to “focus my energies and attention on new products and early initiatives,” much as he did during the early days of Alexa and the Kindle. Brian Olsavsky, Amazon’s chief financial officer, said on a call with reporters that Bezos “will be involved in many large, one-way door issues,” the sort of practically irreversible decisions that include major acquisitions.
This is no doubt a comfort for investors, who expressed their satisfaction with the orderly transition by resisting a panicked sell-off and keeping Amazon stock relatively flat in extended trading. If there’s one thing they’ve learned about Bezos over the last 25 years, it’s to trust he knows exactly which door to go through at precisely the right time.
TORONTO – Roots Corp. may have built its brand on all things comfy and cosy, but its CEO says activewear is now “really becoming a core part” of the brand.
The category, which at Roots spans leggings, tracksuits, sports bras and bike shorts, has seen such sustained double-digit growth that Meghan Roach plans to make it a key part of the business’ future.
“It’s an area … you will see us continue to expand upon,” she told analysts on a Friday call.
The Toronto-based retailer’s push into activewear has taken shape over many years and included several turns as the official designer and supplier of Team Canada’s Olympic uniform.
But consumers have had plenty of choice when it comes to workout gear and other apparel suited to their sporting needs. On top of the slew of athletic brands like Nike and Adidas, shoppers have also gravitated toward Lululemon Athletica Inc., Alo and Vuori, ramping up competition in the activewear category.
Roach feels Roots’ toehold in the category stems from the fit, feel and following its merchandise has cultivated.
“Our product really resonates with (shoppers) because you can wear it through multiple different use cases and occasions,” she said.
“We’ve been seeing customers come back again and again for some of these core products in our activewear collection.”
Her remarks came the same day as Roots revealed it lost $5.2 million in its latest quarter compared with a loss of $5.3 million in the same quarter last year.
The company said the second-quarter loss amounted to 13 cents per diluted share for the quarter ended Aug. 3, the same as a year earlier.
In presenting the results, Roach reminded analysts that the first half of the year is usually “seasonally small,” representing just 30 per cent of the company’s annual sales.
Sales for the second quarter totalled $47.7 million, down from $49.4 million in the same quarter last year.
The move lower came as direct-to-consumer sales amounted to $36.4 million, down from $37.1 million a year earlier, as comparable sales edged down 0.2 per cent.
The numbers reflect the fact that Roots continued to grapple with inventory challenges in the company’s Cooper fleece line that first cropped up in its previous quarter.
Roots recently began to use artificial intelligence to assist with daily inventory replenishments and said more tools helping with allocation will go live in the next quarter.
Beyond that time period, the company intends to keep exploring AI and renovate more of its stores.
It will also re-evaluate its design ranks.
Roots announced Friday that chief product officer Karuna Scheinfeld has stepped down.
Rather than fill the role, the company plans to hire senior level design talent with international experience in the outdoor and activewear sectors who will take on tasks previously done by the chief product officer.
This report by The Canadian Press was first published Sept. 13, 2024.
VANCOUVER – Mediated talks between the union representing HandyDART workers in Metro Vancouver and its employer, Transdev, are set to resume today as a strike that has stopped most services drags into a second week.
No timeline has been set for the length of the negotiations, but Joe McCann, president of the Amalgamated Transit Union Local 1724, says they are willing to stay there as long as it takes, even if talks drag on all night.
About 600 employees of the door-to-door transit service for people unable to navigate the conventional transit system have been on strike since last Tuesday, pausing service for all but essential medical trips.
Hundreds of drivers rallied outside TransLink’s head office earlier this week, calling for the transportation provider to intervene in the dispute with Transdev, which was contracted to oversee HandyDART service.
Transdev said earlier this week that it will provide a reply to the union’s latest proposal on Thursday.
A statement from the company said it “strongly believes” that their employees deserve fair wages, and that a fair contract “must balance the needs of their employees, clients and taxpayers.”
This report by The Canadian Press was first published Sept. 12, 2024.
MONTREAL – Travel company Transat AT Inc. reported a loss in its latest quarter compared with a profit a year earlier as its revenue edged lower.
The parent company of Air Transat says it lost $39.9 million or $1.03 per diluted share in its quarter ended July 31.
The result compared with a profit of $57.3 million or $1.49 per diluted share a year earlier.
Revenue in what was the company’s third quarter totalled $736.2 million, down from $746.3 million in the same quarter last year.
On an adjusted basis, Transat says it lost $1.10 per share in its latest quarter compared with an adjusted profit of $1.10 per share a year earlier.
Transat chief executive Annick Guérard says demand for leisure travel remains healthy, as evidenced by higher traffic, but consumers are increasingly price conscious given the current economic uncertainty.
This report by The Canadian Press was first published Sept. 12, 2024.
