Sales 2023: US$87.115 billion (€80.565 billion)

Overview

Amazon: from online bookseller to the world's largest department store, operating 24 hours a day, one of the greatest successes in economic history. Part of the Big Five of the major technology companies (Alphabet, Meta, Apple, Amazon, Microsoft), CEO Jeff Bezos is the third richest person in the world with a net worth of US$194 billion (Forbes 2024 ranking). Amazon now also operates as a traditional media group, has its own book publishing companies, and produces elaborate TV series and films for its streaming service. Bezos has also controlled the Washington Post, one of the most influential daily newspapers in the US, since 2013.

The sales figures in the IfM ranking refer to the figures given in the Amazon Annual Report 2023 for subscription services and advertising services.

General Information

Headquarters
410 Terry Avenue North
Seattle, WA 98109-5210 
USA
Telephone 001 206 2661000
Internet: ir.aboutamazon.com

Branches of trade: Streaming services, film production, publishing, advertising
Legal form: Stock Company
Financial year: 01.01. – 31.12.
Founding year: 1994, listed on the stock exchange since 1997

Basic economic data (in US$ million)

	2023	2022	2021	2020	2019
group sales	574.785	513.983	469.822	386.064	280.522
Revenue subscription/advertising services	87.115	72.957	62.928	44.980	31.385
Group profit (loss)	30.425	(2.722)	24.879	22.899	11.588
Stock price (year end)	145,24	84,00	166,72	162,85	93,75
Employees	1.525.000	1.541.000	1.608.000	1.298.000	798.000

Executives and Directors

Executive Officers:

• Jeffrey P. Bezos, Executive Chair
• Andrew R. Jassy, President and CEO
• David H. Clark, CEO Worldwide Consumer
• Brian T. Olsavsky, senior vice president and chief financial officer
• Shelley L. Reynolds, Vice President, Worldwide Controller and Principal Accounting Officer
• Adam N. Selipsky, CEO Amazon Web Services
• David A. Zapolsky, Senior Vice President, General Counsel and Secretary

Board of Directors:

• Jeffrey P. Bezos, Executive Chair
• Andrew R. Jassy, President and CEO
• Keith B. Alexander, Co-CEO, President
• Edith W. Cooper
• Jamie S. Gorelick
• Daniel P. Huttenlocher
• Judith A. McGrath
• Indra K. Nooyi
• Jonathan J. Rubinstein
• Patricia Q. Stonesifer
• Wendell P. Weeks

History

Computer scientist Jeffrey P. Bezos founded the company in July 1994 in Seattle, Washington, as a North American online bookstore under the name Cadabra.com, initially in cooperation with the bookseller Barnes & Noble. In Seattle, the location of Microsoft's headquarters, not least because there is a correspondingly large technical talent lived. And the main reason Bezos renamed his company Amazon was simply the initial. In July 1995, Amazon went online and sold with Douglas R. Hofstadter's "“Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought” the first book. Two months later, Amazon had monthly sales of $20,000. Sales in 1996: $15.7 million. Sales in 1997: $147.8 million.

In 1997, Amazon was listed on the NASDAQ technology stock exchange. Twenty years later, Fortune wrote in May 2017 that if someone had bought $5,000 in Amazon shares back then, "they would be worth $2.4 million today." Then came the expansion abroad, for example, with the 1998 acquisition of ABC-Bücherdienst GmbH, the German online pioneer with a book database available in the Btx system since 1991 and online since 1995, "for a double-digit million amount." The first localized websites were set up abroad, and at the same time, Amazon also began selling music, videos, and electronics. And expanded its product range. From 2002, it included internet data ("website popularity," "internet traffic," etc.) and, via its subsidiary Amazon Web Services (AWS), founded in 2006, the sale of cloud services to companies. AWS: market leader since 2017, the world's largest cloud provider, a company within a company. Since 2002, third-party sellers have been able to offer their own (new or used) products free of charge on the e-commerce platform Amazon Marketplace. In the following years, Amazon became a shipping giant and opened kitchen, household, living, hardware, garden, sports and leisure, shoe, accessories, clothing, drugstore, and beauty shops on its own websites. And since 2017, it has had its own fashion line, "Find."

Starting in 2009, after the acquisition of Abebooks, used books were also offered, as were "self-published" books (as print or e-book editions) with CreateSpace.com. In 2007, the Kindle e-book reader was introduced, which would become a billion-dollar business. With it, Bezos revived the e-book, which had been almost written off at the turn of the millennium. In 2012, sales of Kindle and Kindle editions increased by 70 percent, while sales of print books increased by a comparatively modest five percent. "The Girl With The Dragon Tattoo" by crime writer Stieg Larsson was the first book whose Kindle version broke the one-million-copy barrier.

Regarding moving images: It all began in September 2006 with the video download service "Amazon Unbox" (in the USA) for films and series, which could be downloaded and played on a computer, via Amazon's own video player, or on various portable devices. In Europe, the company operated through the online rental service Lovefilm, founded in December 2003 by Arts Alliance Media (London), which was acquired in early 2011. In Germany, for example, it operated as a DVD mail order service. In February 2014, Lovefilm merged with the shipping service Amazon Prime to form Amazon Instant Video (renamed "Amazon Video" in 2015 and "Prime Video" in February 2018). New technologies made higher-quality video streaming possible in the mid-2010s. With the Amazon Video streaming service, the company responded primarily to the success of Netflix, its main competitor, investing in original series and films, buying independent films at festivals, and hiring top-class directors. With Amazon's cash reserves at its disposal, it naturally also managed to outcompete major Hollywood studios.

In 2013, billionaire Amazon CEO Bezos acquired the Washington Post, one of the United States' leading daily newspapers, legendary after the publication of the Pentagon Papers in 1971 and the uncovering of the Watergate scandal, which led to Nixon's resignation in 1974. He thus purchased the Washington Post, which in 2012 ranked 42nd in the IfM ranking of the world's largest media companies. There is no legal connection between Amazon and the Post; Bezos paid for the purchase (for the "bargain price" of $250 million) from his personal fortune. Financially, the newspaper is doing significantly better under its new owner, primarily due to growth in the digital market. Its journalistic profile has also become sharper. When it comes to Trump coverage, the Washington Post is considered more aggressive than the more sober New York Times. Nevertheless, you won't find any "hard-hitting investigations" into the poor working conditions at Amazon there. Kindle devices come pre-installed with the Post's app, and Prime subscribers receive the digital edition at a significant discount. Former US President Trump railed against the "Amazon Washington Post" at the time.

Amazon continued to grow. In June 2017, it acquired the world's largest organic supermarket chain, Whole Foods Market. The Amazon Fresh grocery delivery service has been available in Germany, specifically in Berlin/Potsdam, Hamburg, and Munich, since May 2017. Observers conjure up a somewhat dystopian image of an army of Amazon delivery vans that will soon be located "at the gates of every major city," "around the clock, to fulfill every consumer desire." The company's fleet of aircraft was expanded by eleven Boeing 767 jets at the beginning of 2021. As of March 31, 2022, Amazon was the fifth most valuable company in the world (with a market capitalization of $1.66 trillion; after Apple, Microsoft, Saudi Aramco, and Alphabet).

management

Jeffrey "Jeff" Bezos, Amazon founder, president, and chairman, was born in Albuquerque, New Mexico, in 1964. He grew up first in Houston, Texas, and later in Miami, Florida, with his mother, two siblings, and his Cuban stepfather. Bezos discovered his interest in science through his grandfather, a retired manager at the U.S. Atomic Energy Commission. He studied at Princeton, first in physics, then computer science and electrical engineering, and completed his bachelor's degree in 1986. He then went to Wall Street as a computer expert. In 1994, he took the plunge and started his own business by founding his own online company. In 1999, Time magazine named him Person of the Year, a "New-Era Entrepreneur" and "King of Cybercommerce." Bezos' visionary ideas can also be found in other spheres. In 2004, he founded Blue Origin, a company that aims to offer low-cost space flights in the long term. The labs and testing area are located in West Texas, near his grandfather's farm.

He was married to novelist MacKenzie Bezos since 1994. They had three sons and an adopted daughter, but their marriage ended in 2019. The separation caused quite a stir, given that the two were "the richest couple in history." Following the divorce settlement, MacKenzie Scott was awarded $38 billion; today (May 2021), she is the fourth-richest woman in the world, according to Forbes. But hey presto: With $175 to $200 billion, her ex-husband is still the second richest of all (after Elon Musk).

At the beginning of February 2021, Amazon announced that founder and CEO Jeff Bezos would be stepping down from his position as CEO in the third quarter of 2021. Bezos commented: "If you do it right, after a few years, a surprising invention becomes normal. People yawn. That yawn is the highest compliment an inventor can receive. If you look at our financial results, you see the long-term results of inventions. Right now, I see Amazon in its most inventive phase, which I think is the optimal time for this transition." So much wealth, so much power, was bound to attract criticism. In 2013, Brad Stone's Bezos biography, "The Everything Salesman," was published, portraying the Amazon founder as a radically profit-driven manager who was brutal and merciless towards employees and competitors. A man with a monstrous laugh, a laugh like an "acoustic stab to the heart."

In July 2021, Inc. magazine quoted Bezos in the article "Why Jeff Bezos stepped down": He said he had "one final, most important thing to teach as we leave." "Despite all we've accomplished, it's clear to me that we need a better vision for our employees' success," he wrote. "We've always wanted to be the most customer-centric company on the planet. We're not going to change that. It's what got us here. But I'm committing us to take it one step further. We're going to be Earth's Best Employer and Earth's Safest Place to Work... and we shouldn't be satisfied with 94 percent of employees saying they'd recommend Amazon to a friend as a place to work," Bezos explains. "We need to strive for 100 percent."

Bezos still has a lot of work to do here. The idea of Amazon becoming the best employer in the world is ludicrous to many. Isn't this the company known for its employees crying at their desks from stress? The company whose warehouse workers are afraid to go to the bathroom because they'll be punished for it? Andrew R. Jassy, born in 1968, has been with the company since 1997 and was previously CEO of Amazon Web Services, will take over the top job. And Jeff Bezos, with a current fortune of around $150.2 billion, ranks fourth among the richest people in the world. 

Business Units

“We seek to be Earth's most customer-centric company.” One of the very first sentences of the 2018 annual report makes it clear what this is all about. Everything, actually. Or rather, “hundreds of millions of products in dozens of categories.” Or: “Amazon started as a bookseller and became a supplier for everything imaginable.” However, only the figures mentioned in the Amazon annual report are important for the IfM ranking. subscription services and advertising services, the revenues generated from various media subscriptions and advertising.

The most well-known subscription option is Amazon Prime Video (e.g., for €69/year in Germany and Austria). This not only includes shipping benefits (premium shipping, same-day delivery, on-demand delivery, Prime Now: "ultrafast delivery" in Berlin and Munich), but also the Prime Video streaming service with thousands of films and series episodes, award-winning original productions, and Prime Music. Also included: unlimited cloud storage for photos, a free selection of PC games, e-books, and magazines, and free access to the Audible audiobook service. There are also paid versions of Music Unlimited and Kindle Unlimited, each with a much more extensive music and book catalog, respectively.

It was nothing short of a bombshell when it was announced shortly before Christmas 2019: Amazon, as a new player, was entering the sports rights market in a big way, having been awarded the A1 rights package by UEFA. And starting with the 2021/2022 season, it will stream sixteen Champions League matches via Prime, every Tuesday for three years. Dazn will have the matches on Wednesdays, and ZDF will have the summaries. Amazon has held the rights for audio live streams of Bundesliga matches since 2017. Individual Premier League matches could already be seen in the UK. Amazon Germany boss Ralf Kleber commented: "We have ventured into the sports highlight of football with audio streaming, and now we want to gradually find out what our customers want." Furthermore, the company is independent of the revenue from expensive sports rights, unlike Sky in Germany, for example. "We don't have to make money from the Champions League offering itself; we can make money from popcorn, beer, or if someone buys shoes afterward. We don't have to put our full weight behind this asset." The price for the rights purchase was not disclosed, but it's unlikely to hurt Amazon.

Amazon's overwhelming market power in many areas repeatedly leads to protests. For example, in the e-book market. With Kindle Unlimited, the digital lending library with over a million e-books, Amazon is attempting to establish a reading flat rate. This is economically advantageous, as people traditionally tend to buy individual titles. With Kindle Unlimited, authors can publish their books directly, without publishers. "It will undermine the entire publishing industry," say publishers. Kindle Unlimited is "a cancer."

Please note: Amazon generates a large portion of its online sales from electronics and computers, primarily products from third-party sellers. However, well-known Amazon private labels can also be found here. An overview: the Kindle e-reader, Fire tablets, Amazon Alexa speakers (echo, echo dot, echo flex, echo show) as the "control center for the smart home," and the Fire TV streaming box.

Current developments

At the end of May 2021, Amazon and MGM (Metro-Goldwyn-Mayer) announced that they had entered into a definitive merger agreement under which Amazon would acquire MGM for a purchase price of $8.45 billion. "MGM has a vast catalog of more than 4,000 films – James Bond, Poltergeist, Raging Bull, Robocop, Rocky, Silence of the Lambs, Stargate, Basic Instinct, Thelma & Louise, Tomb Raider, The Magnificent Seven, The Pink Panther, The Thomas Crown Affair, and many others – as well as 17,000 TV series, including Fargo, The Handmaid's Tale, and Vikings, which together have won more than 180 Academy Awards and 100 Emmys," said Mike Hopkins, Senior Vice President of Prime Video and Amazon Studios. On March 15, 2022, the global news broke: the merger had been approved by EU competition authorities. And Amazon is consolidating its market presence among video streaming platforms (ranking second behind Netflix, ahead of Disney and Apple).

Incidentally, at the beginning of October 2020, members of the Subcommittee on Competition in the US House of Representatives published a 449-page report. They had spent over a year investigating the four major tech companies—Google, Amazon, Facebook, and Apple—and concluded that they were once again dealing with monopolists like those in the days of oil barons and railroad magnates, with all-powerful platforms with a gatekeeper position that, ultimately, must be threatened with breakup.

However, the era that the US Big Tech companies shaped "economically and in terms of innovation," when Google, Apple, Microsoft, Amazon, and Facebook were stock market stars, could be coming to an end, as Die Zeit wrote on December 11, 2022: "At the beginning of 2022, the shares of Apple, Microsoft, Alphabet, Amazon, and Meta went into an unexpected downward spiral after these companies had delighted investors with exorbitant price gains for a decade. But the stock market year is ending in a veritable crash for them, just like for the overwhelming rest of the tech industry." Amazon has plummeted 48 percent since January, Apple by 21 percent, Microsoft by 27 percent, Alphabet by 33 percent, and Facebook's parent company, Meta, has even plummeted 66 percent. These were losses that were hardly imaginable. "The Big Tech boom is over, and Wall Street knows it," the industry media outlet Re/code described the crash.

literature

• Stone, Brad: The Everything Seller: Jeff Bezos and the Amazon Empire. Campus Verlag 2018
• Galloway, Scott: The Four: The secret DNA of Amazon, Apple, Facebook and Google. Plassen 2017