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Amazon’s earnings miss means Jeff Bezos is no longer world’s richest person

Amazon’s earnings miss means Jeff Bezos is no longer world’s richest person


That was fast

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Tech And Media Elites Attend Allen And Company Annual Meetings In Idaho
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Amazon CEO Jeff Bezos is once again the world’s second richest person, after a brief stint earlier today as the wealthiest individual on Earth. Amazon reported its second quarter earnings today, showing a profit of just $197 million on strong sales of $38 billion. The dip in profit, a drop of 77 percent from $857 million this time a year ago, is mainly due to Amazon’s aggressive investments in its own business.

It does mean, however, that Bezos’ personal fortune, given his roughly 80 million shares in Amazon, will take a sizable enough hit to keep him from climbing back to the top. Bezos was already back at second place at the time of market close today, but strong enough earnings would have clinched him the crown going into tomorrow. Yet Amazon’s stock is down 2 percent in after-hours trading, thanks to the earnings miss, making it highly likely Microsoft co-founder Bill Gates will hold onto the title with his personal fortune of $90.8 billion and climbing.

Bill Gates is once again the world’s richest person

Of course, no one was really expecting Bezos to stay atop the list for long — and these kind of absurd proclamations tied to personal wealth are a bit of silly tech industry posturing when you take them at face value. But given the constant fluctuations in market cap for both Amazon and Microsoft, it’s highly likely the two billionaires will trade the title back and forth a number of times in the coming months as both Amazon and Microsoft continue to grow and amass influence in their respective sectors.

The one area that will be interesting to watch is cloud computing. That’s where Amazon and Microsoft are both fiercely competing with one each other to win over businesses that are increasingly looking to the cloud for hosting and computationally intensive tasks like training and operating artificial intelligence software. In that realm, Amazon Web Services, the company’s cloud platform, continues to make impressive gains. AWS posted operating income of $916 million this most recent quarter, a 28 percent jump from a year ago, on sales of $4.1 billion. Though it lags behind Microsoft’s overall “Intelligent Cloud” division, which recently posted $7.4 billion in sales and an annual run rate of nearly $19 billion, AWS remains a market leader in key segments like cloud hosting.

That the two companies’ public-facing founders are now sparring for the world’s richest title — just as their respective corporations are battling for control of the cloud — is rather fitting. And although Bezos lost the title today, it probably won’t be long before the long-term investments his company is funneling into real-world logistics, robotics, and, most recently, groceries pay off, likely in the form of an ever-ballooning market cap and more control over how consumers buy and consume products every day.