Dear Shareholders

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's 2007 Kindle launch and its features. 0:00 Amazon introduced Kindle in 2007, a purpose-built reading device with wireless access to books, blogs, magazines, and newspapers. Improving the book experience through innovation. 1:51 Amazon aimed to improve upon the physical book by creating an e-reader that disappears, allowing readers to become engrossed in the author's world without distractions. E-book features and benefits. 3:39 Kindle offers seamless book discovery and purchase, with features like word look-up and automatic book storage. The impact of technology on reading habits. 5:02 Kindle's purpose-built design aims to counteract info snacking tools' shorter attention spans. Amazon's mission, innovation, and customer-first approach. 6:39 Bezos emphasizes customer-first approach and optimism for Kindle's impact on reading.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's growth during the pandemic and its aftermath. 0:10 Amazon CEO highlights company's role in pandemic, including PPE and remote work support. AWS revenue grew 37% in 2020, driven by companies optimizing their infrastructure and shifting to the cloud. Amazon's innovation and adaptability during the pandemic. 4:12 Amazon's commitment to employee dedication and extraordinary efforts during the pandemic was crucial in responding to the disruptive challenges (Jeff Bezos) Amazon's iterative approach to fulfillment capabilities and customer experiences through constant experimentation and invention (Amazon) Amazon invested over $100 billion in its delivery network from 2004 to 2021, expanding from 7 fulfillment centers to 253, with 157 additional centers planned globally. Amazon aims to deliver millions of items within 1-2 days, with a focus on iterative innovation and customer satisfaction, despite periodic peaks in investment. Innovation and product development at AWS. 10:10 AWS launched EC2 in 2006 with limited features to listen to customers and iterate quickly, eventually adding capabilities to become a multibillion-dollar service. AWS innovated in chips, devices, and EC2, delivering 40% better price performance and 25% improvements with Graviton 3. Amazon aims to make Alexa the world's most helpful personal assistant. Amazon's innovation and growth strategies. 16:53 Amazon Prime Video has expanded its content offerings through original shows and acquisitions, including award-winning series like "Transparent" and "The Marvelous Mrs. Maisel." Amazon Prime Video has partnered with the NFL for exclusive streaming rights and plans to reinvent the NFL viewing experience for football fans. Amazon aims to be Earth's Best Employer by prioritizing employee well-being and safety, with a focus on reducing injury rates in its fulfillment network. The company has identified 100 employee experience pain points and is systematically solving them, with a focus on improving safety and reducing strain, sprains, falls, and repetitive stress injuries. Amazon aims to transform its operations and increase affordable housing in communities where it has a large presence. Amazon's approach to innovation and customer experience. 24:04 Amazon prioritizes hiring "builders" who invent and experiment to improve customer experience. Speed is a leadership choice, not a preordained fate, with trade-offs but requiring right tools and permission to move fast. Amazon prioritizes long-term innovation and iterative improvement to create compounding gains for customers and the business.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's long-term approach in turbulent times. 0:00 Amazon (2008) prioritizes long-term thinking, customer obsession, and invention. Customer-focused approach to innovation. 1:05 Long-term orientation + customer obsession = patiently developing solutions through working backwards from customer needs. Kindle e-reader technology and customer experience. 2:06 Amazon prioritized customer experience over technical limitations, leading to successful Kindle sales. Retail business strategy prioritizing customer trust and long-term profit. 3:29 Retailer prioritizes earning customer trust through low prices and free shipping, believing it will lead to long-term profit growth. Amazon's growth, efficiency, and investments. 4:49 Amazon focuses on selection and efficiency, identifying and eliminating waste in its cost structure. Bezos highlights potential for long-term free cash flow and high returns on invested capital through investments in AWS, digital media, and new product categories.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's shareholder letter from 2000, highlighting the company's resilience despite market downturn. 0:10 Amazon's shareholders faced an 80% loss in 2000, but the company's position improved. Company growth, sales, and profit. 0:56 Amazon's sales grew 140% in 2000, with Pro Forma operating loss shrinking to 6% of sales in Q4. Company's high customer satisfaction score despite low stock price. 2:14 Amazon's focus on customer satisfaction led to high scores on the American Customer Satisfaction Index, yet its stock price decreased. The challenges of e-commerce scale and the impact of capital market closures. 3:33 Speaker 2 underestimated time available to enter e-commerce categories and difficulty for single companies to succeed. Future of e-commerce and Amazon's growth strategy. 4:50 Amazon's future growth driven by relentless improvements in customer experience. Bezos outlines Amazon's goals for 2001, prioritizing pro forma operating profit.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's business strategy and growth in 1998. 0:00 Amazon's 1998 letter highlights its rapid growth, ambition to become a go-to online retailer, and focus on customer satisfaction. Amazon's growth and expansion in 1998. 1:44 Amazon's sales grew 330% and customer accounts increased 300% in 1998, with repeat customers placing 64% of orders on the website. Amazon's growth and customer-centric approach. 3:26 Company grew from 600 to 2100 employees and strengthened management team, expanded distribution centers, and improved product availability and costs. Amazon prioritizes customer satisfaction through constant innovation and hiring passionate employees. Admiring and learning from colleagues. 7:02 Speaker 2 seeks to work with people they admire, believing it will raise the group's effectiveness and fight entropy. Investment, growth, and competition for Amazon. 8:30 Amazon plans to invest aggressively to build a multibillion dollar revenue company serving 10s of millions of customers with operational excellence and high efficiency. Bezos emphasizes long-term investment approach, despite growth challenges.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's financial strategy and cash flow. 0:00 Amazon (2004) prioritizes free cash flow per share over earnings growth. Transportation machine's profitability. 1:30 Entrepreneur invents $160M transportation machine, earns $10M in year one. Income statements vs. cash flows in business valuation. 2:31 Income statement shows 100% compound earnings growth, but cash flow statements reveal negative cumulative free cash flow of $530 million. Cash flow and growth in a business. 4:02 The business's slow growth is actually beneficial, but investors would still find it unviable due to cash flow issues. Amazon's financial performance and shareholder value. 5:30 Amazon prioritizes free cash flow by improving customer experience and maintaining a lean cost structure, resulting in a 38% increase in free cash flow to $477 million in 2004. Amazon has efficiently managed its share count by repaying convertible debt and eliminating potential future dilution, resulting in more cash flow per share and long-term value for owners.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's business strategies in 2002. 0:00 Amazon in 2002: Personalized, tech-driven shopping experience with deep selection and real-time customer reviews. Amazon's approach to offering low prices and high-quality customer experience. 1:18 Amazon transforms customer experience costs into fixed expenses, improving efficiency and lowering prices. Amazon's product selection, pricing, and customer satisfaction. 2:57 Amazon has increased selection, lowered prices, and improved customer satisfaction. Book prices in major superstores. 4:55 Book superstores' best-selling titles were found to be 23% cheaper at Amazon.com. Amazon's financial performance and customer satisfaction. 6:27 Bezos highlights Amazon's focus on customer satisfaction and financial growth in annual letter to shareholders.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's corporate culture and growth. 0:00 Amazon's diverse offerings, including consumer and enterprise services, grew rapidly despite initial differences. Amazon's distinctive culture prioritizes customer obsession, innovation, and failure. Bold inventions, growth, and customer value at Amazon. 3:11 Speaker emphasizes the importance of boldness and experimentation in business, citing Amazon's success with AWS Marketplace and Prime as examples. Speaker highlights the passion and creativity of Amazon teams, while also acknowledging the potential for size to slow down innovation if not managed carefully. Amazon has expanded its Prime service, offering same-day delivery and exclusive content, including original series and movies from renowned creators. Amazon's Prime membership grew 51% last year, with 47% growth in the US and faster international growth. Amazon's efforts to help small businesses grow globally. 9:45 Amazon lending program provides $1.5B in funding to small businesses globally, helping them grow and expand internationally. Amazon invents "amazon.com" to help small businesses go online in under 60 minutes. Cloud computing and innovation at Amazon Web Services. 13:42 Amazon Web Services (AWS) has expanded rapidly into the world's most comprehensive cloud service over the past 10 years, with a customer-obsessed approach and rapid innovation. AWS prioritizes customer needs over competition, offering cost-effective services like Aurora and Redshift. AWS provides unbelievable opportunities for businesses to reinvent themselves and add new customer experiences. Sustainability and social issues at Amazon. 20:26 Speaker 1 aims to balance size and speed with a culture that fosters invention and experimentation. Amazon aims to use 100% renewable energy across its global infrastructure. Amazon offers programs like Career Choice, Leave Share, and Ramp Back to support employees' career development and work-life balance. The company's approach to benefits is egalitarian, providing the same opportunities for all employees, regardless of seniority or job function.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's business strategies and success. 0:00 Amazon's CEO highlights three life-long business partners: marketplace, prime, and AWS. Amazon's hybrid model of selling products from both Amazon and third-party sellers has been successful, accounting for 40% of units sold worldwide. Amazon's global expansion and Prime benefits. 3:12 Amazon expands global marketplace, helping sellers reach customers worldwide. Amazon launched Prime 10 years ago with free and fast shipping, despite being told it was risky. Amazon's business strategies and growth. 7:43 Amazon invests in original content for Prime Instant Video, with positive impact on membership and sales. Amazon Prime Now offers free 2-hour delivery on 1000s of items in select cities, with one-hour delivery available for a fee. FBA (Fulfillment by Amazon) completes the circle between marketplace and Prime, providing more sales for sellers and more Prime-eligible selection for members. AWS growth driven by speed, agility, and cost savings for customers and enterprises. AWS adoption and innovation. 14:00 AWS helps IT departments complete tasks faster and more efficiently. Amazon Aurora offers 5x better performance at 1/10th the cost of commercial databases. Amazon's business strategies and growth. 16:58 AWS leadership position and customer satisfaction drive growth and profitability. Amazon launched the Career Choice Program, prepaying 95% of tuition for in-demand fields like airplane mechanic or nursing, with over 2000 participants in 8 countries. Amazon aims to draw great talent to serve customers in fulfillment and customer service centers, with a focus on career choice and innovation.

Visit ⁠Dear Shareholders⁠ website to get updates and vote on what shareholder letters come next. Show Notes: Amazon's customer satisfaction and expectations. 0:00 Amazon ranked #1 in customer satisfaction surveys for 8th year in a row. Customers' expectations are constantly evolving, driving companies to innovate and improve. High Standards in Organizations. 3:11 Speaker 2 discusses the importance of high standards in organizations, highlighting the distinction between intrinsic and teachable standards. Speaker 2 argues that high standards are domain-specific and must be learned separately in each area of interest, rather than being universal across all areas. Speaker 2 shares a personal story about a friend's handstand journey, highlighting the importance of realistic expectations and high standards. The quality of memos written for meetings at Amazon varies widely, with great memos being difficult to define but easily recognizable, and poorly written memos often due to unrealistic expectations on scope. Teachable elements of high standards include recognizing and explicitly coaching realistic scope, and doing so at all levels of detail (memos to whole new initiatives). Leaders with relentlessly high standards have served Amazon well, with recent milestones representing the fruition of collective effort. Amazon's growth, Alexa, and hardware sales. 11:17 Amazon exceeded 100 million paid Prime members globally, with over 5 billion items shipped in 2017. AWS announced over 1000 significant services and features in 2017, including Amazon SageMaker, which made machine learning more accessible to developers. Alexa adoption and skills surpass 30,000, with improved speech recognition and language understanding. Amazon's growth in various areas, including Kindle, Prime Video, music, fashion, and grocery. 16:24 Amazon Prime Video expands offerings with new originals, channels, and licensing deals. Amazon expands into fashion, grocery, and more with Whole Foods acquisition and Prime benefits. Amazon expands offerings with Prime benefits at Whole Foods, walk-out shopping at Amazon Go, and Treasure Truck donations. Amazon's sustainability initiatives and job creation. 22:57 Amazon has expanded its renewable energy projects, now producing enough clean energy to power over 330,000 homes annually. Amazon has invested over $150 billion worldwide in fulfillment networks, transportation capabilities, and technology infrastructure, creating over 1.7 million direct and indirect jobs. Amazon's Career Choice program pre-pays 95% of tuition fees and textbooks for high-demand occupations, with over 16,000 associates participating globally. Amazon's core values and approach remain unchanged, with a focus on being the most customer-centric company, despite the many challenges and opportunities ahead.