Analysts vote thumbs up on Andy Jassy’s ascension to Amazon CEO – SiliconANGLE News

You might not see it in Amazon.com Inc.s stock price today, down 2%, but the surprise appointment of Andy Jassy to replace founder Jeff Bezos as the tech giants new chief executive is getting positive reviews among investors and analysts across the globe.

Jassy, currently CEO of Amazon Web Services Inc., the companys now massive cloud computing unit, will start his new job this summer as Bezos becomes whats likely to be a very active executive chairman focused on special projects. Although fewer people know Jassy well, he commands respect from those who do as well as those who just know that he has built a $50 billion cloud giant in just 15 years.

Heres what analysts are expecting to see from Amazon, Bezos and Jassy going forward:

The timing of the transition is particularly curious in the middle of a pandemic, said Forrester Research Inc. Vice President andPrincipal Analyst James McQuivey.

Perhaps he had this transition planned earlier and delayed it due to the pandemic or perhaps he realizes that whoever leads the company past the pandemic will rightfully be seen as the leader for Amazons next phase, he said. Either way, the goal is to avoid a handoff like when Bill Gates chose Steve Ballmer, who did not successfully transition Microsoft into a new era.

McQuivey noted as well that it doesnt appear Bezos had in mind Apple Inc.s Tim Cook, widely seen as someone who has kept Apple maintaining its production lead if not founder Steve Jobs disruptive innovation. Bychoosing Andy Jassy, Bezos is potentially skipping the Ballmer transition phase and moving right into a Satya Nadella mode, turning to an expert in running a cloud business, someone who understands the long-term role that infrastructure and business services will play for Amazon, even as it tries to maintain its role as a consumer innovator, he said.

Jassys appointment to the top job also suggests Amazons cloud technology will drive an even larger digital platform opportunity at Amazon, said Forrester Vice PresidentAllen Bonde. While consumer e-commerce is a big market, business-to-business is an even bigger prize, he said. Picking a leader who is driving their main enterprise offering may indicate the future of Amazon is in fact selling more to businesses than consumers.

But why would Bezos step back now? Forrester Vice Presidentand Principal Analyst Sucharita Kodali wonders if the pressure of the government investigations, which a PR team cannot change, played a role in this decision at this time. She also wonders whether the move means full steam ahead for cloud and advertising, while retail is more of a maintenance, not a growth business? It could actually be really good news for retail but we wont know the answer to that for months, if not years.

More broadly, added Forresters Lauren Nelson, Jassy will face a challenge coming out of the pandemic. Amazon gained significant revenue amid the pandemic both for its e-commerce site and in cloud platform revenue, she said. But this new era of prosperity may be short-lived as the company may face significant new regulation and organization upheaval.

Indeed, agreed Nicholas McQuire, senior vice president of enterprise research at CCS Insight, the key question will be how Jassy manages some of the inevitable bumps in the road Amazon will face with issues like antitrust, workers rights and employee activism on this rise.He has proven to be very outspoken on broader political issues in the past and he will face an increasingly scrutinous media as the firm continues on its trajectory. Jassy will need to maintain trust in the Amazon brand in light of these issues.

But he thinks Jassy is up to the job. Bezos created the blueprint for internet businesses: rapid innovation, huge scale and relentless focus on the customer and few people on the planet have the DNA of managing high-growth/high-innovation businesses at scale than Andy Jassy, he said.

Financial analysts, while surprised as well, cheered the move as well. As Michael Levine of Pivotal Research Group put it, Although not as familiar a face to the general public as Bezos, Jassy is exceptionally well-regarded by the investment community.

Or as Trip Chowdhry of Global Equities Research put it more pointedly, Andy changed the narrative from Nobody Gets Fired For Buying IBM to Nobody Gets Fired For Swiping Credit Card For AWS.'

Chowdhry went even further, saying hes more impressed by Jassy than Bezos. Andy Jassy is an exponential thinker, of same caliber as Elon Musk, he wrote in a note to clients. Andy Jassy will be a phenomenal CEO of Amazon.

Likewise, John Blackledge of Cowen & Co. said we are encouraged by the choice and believe Jassy, a highly respected Amazon vet since 97, will be an effective leader in the top role.

Still, most dont see fundamental changes coming in core management philosophy and practice.

Mr. Bezos will still play a key role in Amazons strategy going forward but focus on his other interests such as Blue Origin and Washington Post, James Lee, managing director of Mizuho Securities USA LLC, told clients. That said, we believe that Amazons leadership will remain strong with a potential emphasis towards the cloud business.

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Analysts vote thumbs up on Andy Jassy's ascension to Amazon CEO - SiliconANGLE News