For Ama­zon, it’s busi­ness as usual de­spite CEO drama

The Mercury (Pottstown, PA) - - BUSINESS - By Joseph Pisani AP Re­tail Writer

NEW YORK >> First it was a heartwrench­ing tweet that he and his wife were getting a di­vorce af­ter 25 years. Then a tabloid re­vealed that he’d been hav­ing an af­fair, re­leas­ing texts and pho­tos of him and his mistress.

As if ei­ther of those weren’t dis­tract­ing enough, now Jeff Be­zos — the world’s rich­est man and CEO of Ama­zon — is ac­cus­ing The Na­tional En­quirer in a blog post of try­ing to black­mail him by threat­en­ing to re­lease more in­ti­mate pho­tos of him un­less he calls off an in­ves­ti­ga­tion into how that in­for­ma­tion was ob­tained in the first place.

But de­spite the all-con­sum­ing per­sonal drama, an­a­lysts and ex­perts don’t ex­pect it to make much dif­fer­ence to Ama­zon it­self, the com­pany Be­zos has steered from an on­line book­store two decades ago to a world­wide juggernaut.

Michael Pachter, an an­a­lyst at Wed­bush Se­cu­ri­ties, es­ti­mates the im­pact on the com­pany to be “0.000 per­cent.”

“I’m cer­tain in­vestors won’t care,” he said.

Oth­ers point out that Be­zos has been able to bal­ance his re­spon­si­bil­i­ties at the helm of the world’s largest on­line re­tailer while also jug­gling his other pur­suits: run­ning a space ex­plo­ration com­pany and own­ing the Washington Post, one of the na­tion’s most in­flu­en­tial news­pa­pers.

“He’s ex­traor­di­nar­ily driven,” says Chris McCabe, who used to work at Ama­zon and now runs ecom­merce Chris, a con­sul­tancy for Ama­zon sell­ers. “He knows how to del­e­gate.”

Ama­zon has a steady line of long­time ex­ec­u­tives who are run­ning each of its busi­nesses, likely keep­ing in­vestors calm.

Jef­frey Wilke, over­sees the re­tail busi­ness, and An­drew Jassy runs the com­pany’s fast-grow­ing cloud com­put­ing busi­ness Ama­zon Web Ser­vices. Both of them have been at the com­pany since the 1990s. And

un­like other CEOs, Be­zos doesn’t speak at con­fer­ence calls with an­a­lysts and in­vestors af­ter the com­pany re­leases its fi­nan­cial re­ports, leav­ing that to Chief Fi­nan­cial Of­fi­cer Brian Ol­savsky, who has been at the com­pany since 2002.

Still, that hasn’t stopped the En­quirer from cast­ing doubts over whether Be­zos can ef­fec­tively over­see his com­pany.

“All of these (text) mes­sages raise se­ri­ous ques­tions about Be­zos’ judg­ment as the CEO of the most valu­able com­pany in the world,” the tabloid said in a Jan. 24 ar­ti­cle.

Seat­tle-based Ama­zon. com Inc. de­clined to com­ment on Be­zos. The com­pany’s stock did not take a big hit, slip­ping 1.6 per­cent at Fri­day’s close. Mean­while, the En­quirer’s pub­lisher, Amer­i­can Me­dia Inc., is dis­put­ing Be­zos’ claims that it used “ex­tor­tion and black­mail” in re­port­ing its story, say­ing that it “acted law­fully.”

In his blog post Thurs­day, Be­zos de­fended his abil­ity to lead Ama­zon: “I founded Ama­zon in my garage 24 years ago, and drove all the pack­ages to the post of­fice my­self. To­day, Ama­zon em­ploys more than 600,000 peo­ple, just fin­ished its most prof­itable year ever, even while in­vest­ing heav­ily in new ini­tia­tives, and it’s usu­ally some­where be­tween the #1 and #5 most valu­able com­pany in the world. I will let those re­sults speak for them­selves.”

He also said he wants to fo­cus on work, not­ing that the per­son he hired to han­dle the in­ves­ti­ga­tion into how his texts were leaked to the En­quirer will also be tasked with “pro­tect­ing” his time.

“I have other things I pre­fer to work on,” Be­zos wrote.

Be­zos’ in­dis­cre­tions are seen more as a per­sonal mat­ter rather than one to do with the com­pany, un­like Tesla’s CEO Elon Musk, for ex­am­ple, whose be­hav­ior has caused the elec­tric au­tomaker’s stock to rise and fall. Musk was re­cently stripped of his chair­man ti­tle and forced to pay a $20 mil­lion penalty to the Se­cu­ri­ties and Ex­change Com­mis­sion for al­legedly dup­ing in­vestors with tweets about a plan to take the com­pany pri­vate.

“This is very much a mat­ter of Jeff Be­zos,” says Neil Saunders, the man­ag­ing di­rec­tor at Glob­alData Re­tail, of Be­zos’ af­fair. “It’s not re­ally any­thing to do with run­ning with the com­pany.”

David Lar­cker, a pro­fes­sor at the Stan­ford Grad­u­ate School of Busi­ness, says it’s up to share­hold­ers and the board of di­rec­tors to de­cide just how en­gaged a CEO is in their work, and whether they should go.

AP PHOTO/CLIFF OWEN, FILE

In this Sept. 13, 2018, file photo Jeff Be­zos, Ama­zon founder and CEO, speaks at The Eco­nomic Club of Washington’s Mile­stone Cel­e­bra­tion in Washington.

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