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Amazon has announced that the pinnacle of its cloud business will likely be replaced by an organization veteran who will help lead the tech giant within the race against rivals akin to Google and Microsoft to develop artificial intelligence products.
In an unexpected leadership change announced Tuesday, Adam Selipsky, the chief executive of Amazon Web Services, will step down on June 3 to “pursue his next challenge.” He will likely be replaced by Matt Garman, who currently serves as senior vice chairman of sales, marketing and global services at AWS.
Amazon CEO Andy Jassy said that when Selipsky was appointed three years ago, it was agreed that he would only serve within the AWS role for “just a few years.”
AWS is a key profit driver for Amazon and is at the center of its work in generative AI. The unexpected leadership change comes as the corporate races against its Big Tech rivals to unveil recent AI services for cloud computing customers.
Selipsky has overseen the recent acceleration of revenue growth at Amazon's cloud division after a broader industry downturn caused customers to drag back on IT spending.
AWS' first-quarter revenue rose 17 percent year-over-year to $25 billion, beating analysts' forecasts. At the identical time, the department's profit margins rose to 38 percent, in comparison with 30 percent within the previous quarter. AWS also generated greater than 60 percent of Amazon's operating income during this era.
Before taking the highest job at AWS, Selipsky was CEO of software company Tableau for five years and, before that, vice chairman of AWS sales, marketing and support for 11 years. Selipsky's successor, Garman, began as an intern at Amazon in 2005 and has worked full-time at AWS since 2006.
“Adam leaves AWS in a robust position, having generated $100 billion in annual revenue last quarter,” Jassy said Tuesday, adding that Garman “has unusually strong skills and experience for his recent role.”
“Given the state of the corporate and the leadership team, now’s the appropriate time for me to make this transition and reap the benefits of the chance to spend more time with family for some time,” Selipsky said.
Garman said that some “organizational adjustments” will likely be announced at AWS in the approaching weeks and that he’s “more optimistic than ever in regards to the innovation and growth potential that lies ahead.”
