Amazon CEO Andy Jassy’s 2022 Take Home Pay Plunges to $1.3 Million
Amazon CEO Andy Jassy saw his 2022 compensation plummet to a fraction of what he took home the year before absent a huge grant of stock awards he received when first taking over the company. The details of his pay package were disclosed on the same day his annual letter to shareholders warned that the money machine that is Amazon Web Services is slowing down.
Jassy earned $1.3 million in 2022, including a salary of $317,500, and $981,223 in stock awards for his 401(k) plan, along with perks like personal security, Amazon said in its annual proxy statement.
That total paled in comparison to the $212.7 million he received in 2021, the majority of which was in the form of a special grant of stock in connection with Jassy’s promotion to CEO in July that year. The stock grants will take 10 years to vest and are expected to represent most of his compensation in coming years, the company said in its 2021 proxy.
Amazon founder and executive chair Jeff Bezos took home $1.68 million, including a salary of $81,840 and $1.6 million in perks like personal security in 2022. Bezos receives no stock-based compensation, but owns about 10% of the company, which currently has a market capitalization of $4.996 trillion.
The details were revealed in the proxy statement, which is sent out to all shareholders ahead of the company’s annual meeting, set for May 24. Shareholders will approve the company’s plans for executive pay, and vote on a host of proposals, including 18 submitted by shareholders — an unusually large number — that delve into how the company addresses issues from unionization and animal welfare to the environmental impact of packaging materials.
Separately, in his letter to shareholders, Jassy said 2022 brought “an unusual number of simultaneous challenges” to Amazon amid “one of the harder macroeconomic years in recent memory.”
Jassy noted that Amazon has experienced much change, and led a great deal, during the 25 years he’s spent with the company. He pointed to the development of Amazon Web Services, its cloud computing business, which went from a fledgling in 2008 to an $85 billion cash generator last year – up from $45 billion in 2020.
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Yet despite a 29% growth rate year-over-year, Jassy said AWS “faces short-term headwinds right now as companies are being more cautious in spending given the challenging, current macroeconomic conditions.”
These short-term headwinds will “soften our growth rate,” Jassy said. He said the company is aiming not to maximize the revenue from the business but to build relationships, including having AWS sales teams work with customers to make sure they are scaling the services they need to the size of their operations. That could mean less revenue up front but helps build loyalty.
The company is also investing heavily in “Large Language Models” and generative AI, the type of technology that powers ChatGPT, along with working to develop new, faster computer chips that powers it. “We have been working on our own LLMs for a while now, believe it will transform and improve virtually every customer experience, and will continue to invest substantially in these models across all of our consumer, seller, brand, and creator experiences,” Jassy wrote.
He also highlighted its advertising business, which he said continues to grow “at a brisk clip,” or 23% year-over-year in 2022. He described efforts to enable companies to target ads and suggested that Amazon’s streaming services will carry more.
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“We also see future opportunity to thoughtfully integrate advertising into our video, live sports, audio, and grocery products,” he said. “We’ll continue to work hard to help brands uniquely engage with the right audience, and grow this part of our business.”
Amazon has a free advertising supported TV (FAST) channel called Freevee and airs ads in some live programming like “Thursday Night Football.”
Amazon in recent months “took a deep look across the company, business by business, invention by invention, and asked ourselves whether we had conviction about each initiative’s long-term potential to drive enough revenue, operating income, free cash flow, and return on invested capital,” Jassy wrote. As a result, the company has stopped opening physical bookstores and 4-Star Stores, which sold top-rated, trending items.
“We also reprioritized where to spend our resources, which ultimately led to the hard decision to eliminate 27,000 corporate roles,” he said.
The company has also called all staffers back to the office at least three days a week beginning in May, a later return than many companies that have scrapped the pandemic remote work policies.
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