“I’m pretty sure we’re the first company to have figured out how to make winning a Golden Globe pay off in increased sales of power tools and baby wipes!”
That’s one of the highlights from Amazon CEO Jeff Bezos’ annual letter to shareholders, released by the company this morning. The statement is a reference to the Amazon original show Transparent, and it’s one of the ways that the Amazon founder uses the letter to stitch together and explain the increasingly varied nature of Amazon’s business.
The primary focus of the letter is three Amazon businesses: its marketplace of third-party sellers, the Amazon Prime membership program, and the Amazon Web Services cloud computing business (for which the company revealed financial results for the first time yesterday.)
Bezos starts the letter with a casual reference to the dating app Tinder.
A dreamy business offering has at least four characteristics. Customers love it, it can grow to very large size, it has strong returns on capital, and it’s durable in time – with the potential to endure for decades. When you find one of these, don’t just swipe right, get married.
Well, I’m pleased to report that Amazon hasn’t been monogamous in this regard. After two decades of risk taking and teamwork, and with generous helpings of good fortune all along the way, we are now happily wed to what I believe are three such life partners: Marketplace, Prime, and AWS. Each of these offerings was a bold bet at first, and sensible people worried (often!) that they could not work. But at this point, it’s become pretty clear how special they are and how lucky we are to have them. It’s also clear that there are no sinecures in business. We know it’s our job to always nourish and fortify them.
The letter comes after Amazon reported a net loss of $57 million, or 12 cents a share, for the first quarter. Despite the loss, the company’s revenue of $22.7 billion topped analysts’ expectations, and Amazon’s shares are soaring in early trading.
Amazon this morning also issued its annual proxy statement, in advance of its annual shareholders’ meeting in June. According to the filing, Bezos’ compensation remains unchanged at an $81,840/year salary, with Amazon paying $1.6 million for his security arrangements. Bezos owns 18 percent of the company’s outstanding shares, the filing says.