Amazon CEO Jeff Bezos will step down later this year, handing over the reins to Andy Jassy, the company's senior cloud executive, according to an announcement Tuesday. As Executive Chair of the Board of Directors of Amazon, Bezos will take charge.

Bezos, 57, founded Amazon in 1994 and has since evolved it into a global mega-retailer in a range of categories ranging from gadgets to groceries to streaming. Under Bezos' leadership, Amazon's market cap crossed $1 trillion in January of last year, and it is currently worth more than $1.6 trillion.

Though observers thought that either Jassy or Jeff Wilke, the CEO of Amazon's global consumer business, would be Bezos' ultimate successor, the corporation kept its succession plans secretive. Wilke will leave Amazon in 2021, according to an announcement made by the company in August. In the third quarter, Jassy, 53, will take over as CEO.

Jassy has been the leader of Amazon's Web Services cloud team since its establishment in 1997. AWS continues to be a major source of earnings for Amazon.

"I will take up the position of Executive Chief Executive Officer of Amazon in Q3 and Andy Jassy will take over as Chief Executive Officer," Bezzo said in a statement to his team. "As Exec Chair, I plan to prioritise creative products and early-stage projects. Andy, who has been there almost as long as I have, is well-known within Amazon. I have a lot of faith in him; he'll be an incredible leader."

The announcement was made in conjunction with Amazon's first $100 billion quarter earnings report. AWS announced a 28 percent revenue increase in the fourth quarter under Jassy's leadership. As of October 2020, AWS accounted for 52 percent of Amazon's operating income.

On the basis of the earnings announcement and the C-suite bombshell, Amazon shares were up roughly 1% in extended trading Tuesday. The company's stock has up over 70% in the last 12 months and has gained roughly 4% so far in 2021.

On a conference call with reporters, Amazon's chief financial officer, Brian Olsavsky, said the leadership change was made after discussions with the company's board of directors. He claims Bezos will remain heavily active and have his fingers all over the corporation. Jassy is a visionary leader, according to Olsavsky, who will add his own skill set to the transition, but Amazon expects a lot of consistency.

When Jassy comes over, he'll have to navigate the corporation through antitrust worries. The House Judiciary subcommittee on antitrust ruled in October that Amazon, Apple, Facebook, and Google have monopoly power after a 16-month inquiry into competitive behaviour at big digital corporations including Amazon. Amazon has also been accused of antitrust violations in the European Union.

Rep. Ken Buck, R-Colo., a member of the House Judiciary Committee, stated on Twitter shortly after the announcement that he has questions for Jassy, implying a potential stumbling block when Jassy takes office.

Bezos stated that he will continue to work on critical Amazon projects, but that he will have more time to devote to the Bezos Earth Fund, Blue Origin, The Washington Post, and the Amazon Day 1 Fund.

“As much as I still tap dance into the office,” Bezos remarked in an internal announcement, “I'm pleased about this transition.” “We have millions of clients who rely on our services, and over a million employees who rely on us for a living. Being the CEO of Amazon is a huge responsibility that takes up a lot of time. It's difficult to focus on anything else when you have that much responsibility.”

CEOs from the IT industry and Amazon rivals congratulated Bezos and Jassy on the upcoming shift, with Microsoft CEO Satya Nadella calling Jassy's rise "well-deserved."

Sundar Pichai, the CEO of Alphabet, wished Bezos luck with his other ventures.