Jeff Bezos assures shareholders they're in good hands at final meeting as CEO
Jeff Bezos on Wednesday stewarded his last shareholder meeting as CEO of Amazon, highlighting the company’s successes in the previous year, while acknowledging it has many challenges ahead.
Bezos announced he’ll formally step down from his role as CEO on July 5, which is the date Amazon was incorporated 27 years ago. He’ll move into the role of executive chairman and hand the reins over to cloud-computing boss Andy Jassy, who Bezos assured investors is well-equipped for the task.
“He has the highest of high standards and I guarantee Andy will never let the universe make us typical,” Bezos said during the meeting, which was held virtually for the second year in a row, due to the coronavirus pandemic. “He has the energy needed to keep alive in us what has made us special.”
Bezos was asked whether Amazon will have any trouble innovating now that it has grown so large and diversified. He acknowledged that Amazon under its new leader Jassy will have to manage newer bets that have no guarantee of being successful, including its Amazon Care telehealth service and Project Kuiper satellite internet network.
“Let me assure you, I can guarantee you that none of these ideas are guaranteed to work,” Bezos 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’ll continue to take big risks.”
Shareholders voted down all 11 proposals submitted by outsiders, which spanned a range of topics from worker safety and Amazon’s hiring practices to its use of facial recognition technology and climate change.
Vote totals weren’t immediately available at the meeting, but Amazon typically releases detailed results in a regulatory filing.
During a question-and-answer session at the end of the meeting, Bezos was asked to address the criticism that Amazon has grown too big and too powerful. Bezos pushed back on that assertion by arguing that Amazon faces intense competition in every industry it does business in, including its core retail business, where the market is “thriving.”
“Consumers can shop at dozens of large national retailers, hundreds of regional retailers, hundreds of thousands of small retailers both online and in store,” Bezos said. “It’s a very healthy industry and far from a winner-take-all situation and we are still a small fraction of retail.”
The IT industry, another market Amazon competes in via its cloud-computing services, also continues to have healthy competition, Bezos argued. “We face 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,” he said.
Just one day earlier, Amazon was sued by the attorney general for Washington, D.C., for allegedly engaging in anticompetitive practices that have unfairly raised prices for consumers and suppressed innovation. The company also faces ongoing probes by multiple federal agencies, state attorneys general and Europe’s antitrust watchdog.
Where regulators have seized on an alleged lack of competition in the retail industry, Bezos suggested consumers have far less choice in other markets.
“Think about mobile phone operating systems,” Bezos said. “Can you think of any successful, small, fast growing mobile phone operating systems? Where are they? Name one. They do not exist.”
Bezos was also asked to comment on Amazon’s $8.45 billion deal for MGM Studios, which was announced hours before the shareholder meeting kicked off on Wednesday.
For Amazon, acquiring the historic Hollywood studio behind the James Bond films will give the company greater tools to keep its 200 million-plus Prime members satisfied, while hooking in new subscribers to the loyalty program (who typically spend more on the site.)
It also supercharges Amazon’s ability to produce original films and TV shows. Amazon’s film and TV division, Amazon Studios, has produced a few hits, including “Manchester By the Sea” and “The Marvelous Mrs. Maisel,” but it has to keep up with well-established players like Netflix and Disney.
In addition to “James Bond,” MGM also has other library favorites like “Thelma and Louise,” “Raging Bull,” “Robocop” and “The Handmaid’s Tale” that made “the acquisition thesis here really very simple,” Bezos said.
“MGM has a vast deep catalog of much beloved intellectual property,” Bezos said. “And with the talented people at MGM and Amazon studios, we can reimagine 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 big beneficiaries.”
Amazon’s annual shareholder meetings have transformed into a popular venue for employees, investors and activist groups to speak up about a range of hot-button topics.
This year was no different, with a range of shareholder resolutions proposing that the company take action on issues including climate change, labor conditions, use of facial recognition technology and racial and gender disparities in the workforce.
Two workers from the site of a failed unionization vote at one of Amazon’s Alabama warehouses presented shareholder proposals, both of which were voted down. Darryl Richardson backed a proposed audit of the company’s impact on racial equity, while Jennifer Bates spoke in favor of a proposal to elect a warehouse worker to Amazon’s board of directors.
Bates argued that hourly workers could add a valuable perspective to Amazon’s board, while advocating for issues that are critical for its workforce.
“I know from my own experience, working at Amazon, that it does not listen to us workers,” Bates said during the meeting. “I have tried on many occasions to raise concerns about workplace safety, scheduling and discipline. But managers are unavailable, don’t listen or simply dismiss me. I’m not alone.”
The topic of working conditions also came up at Amazon’s shareholder meeting last year. It’s an issue that has taken on a heightened focus both inside and outside of the company as Amazon’s front-line warehouse and delivery workers expressed safety concerns throughout the coronavirus pandemic.
Alicia Boler Davis, Amazon’s vice president of global customer fulfillment, defended the company’s treatment of its workers.
“While it may be easy for critics to paint in broad brush strokes an image of a cold-hearted employer and negative working conditions, the reality is very different,” said Boler Davis, adding that Amazon is committed “to doing the right thing by its employees.”