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AWS CEO Adam Selipsky Steps Down Amid Generative AI Challenges

Amazon has announced that Adam Selipsky will step down as CEO of AWS, making way for Matt Garman to take the helm on June 3rd

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In a surprising turn of events, Amazon has confirmed that Adam Selipsky, the CEO of AWS, is stepping down from his role. The announcement comes amid a period of significant change and challenges for the cloud computing giant, as it navigates the rapidly evolving landscape of generative AI and faces increased competition from rivals like Microsoft Azure and Google Cloud.

Andy Jassy, Amazon’s CEO, shared the news in an internal memo that was later published on the company’s blog. In the memo, Jassy revealed that Matt Garman, AWS’ current sales chief, will be promoted to the position of CEO, effective June 3rd. Garman, who joined AWS in 2006 as one of the first product managers, has a wealth of experience within the organization, having previously headed AWS’ EC2 cloud computing org and served as the general manager of all AWS compute services.

Selipsky’s departure comes as a surprise to many, given his long history with AWS. He was one of the first VPs hired by the company in 2005 and spent 11 years leading sales, marketing, and support before leaving to become CEO of Tableau, a data visualization software company. In 2021, Selipsky returned to Amazon to take the reins at AWS.

However, recent reports suggest that Selipsky may have missed the boat on generative AI, which could have contributed to his ouster. According to The Information, AWS had originally planned to unveil its own generative AI model, code-named Bedrock, at its annual conference in November 2022. However, technical issues forced the organization to postpone the launch, and AWS later had to settle for a co-investment in Anthropic with rival Google, after passing on opportunities to back two leading generative AI startups, Cohere and Anthropic.

Despite these setbacks, Jassy highlighted Selipsky’s accomplishments in his memo, praising his leadership during the pandemic and his decision to help customers become more efficient in their spend, even if it meant less short-term revenue for AWS. Jassy also noted that Selipsky leaves AWS in a strong position, having reached a $100 billion annual revenue run rate in the past quarter, with year-over-year revenue accelerating again.

AWS remains the undisputed leader in the cloud computing market, with a 31% market share, compared to Microsoft Azure’s 25% and Google Cloud’s 11%. The division also continues to be one of Amazon’s most profitable business units, generating $9.42 billion in operating income in the most recent fiscal quarter, which accounts for about 62% of Amazon’s total.

As Matt Garman steps into his new role as CEO of AWS, he will face the challenge of maintaining the company’s dominant position in the cloud computing market while navigating the rapidly evolving landscape of generative AI. With Jassy’s recent statement that AWS’ generative AI businesses alone have hit a combined “multi-billion dollar run rate,” it’s clear that the future of AWS will be closely tied to its ability to innovate and adapt in this exciting new frontier.

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