Amazon’s lockdown bonanza pushes Jeff Bezos’s fortune to £109bn | Amazon

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Jeff Bezos, the chief executive of Amazon, has reinforced his position as the world’s richest person with a fortune of $138bn (£109bn) as the online retailer was declared a “clear winner” from the coronavirus crisis.

While most businesses have been hit hard by the impact of the pandemic and the looming recession, shares in Amazon have risen to a record high as hundreds of millions people stuck in lockdown conditions turn to the delivery giant to keep them fed and entertained.

Bezos, who started Amazon in his garage in 1994 and still owns 11% of the company’s shares, saw his paper fortune swell by $6.4bn on Tuesday alone as Amazon’s shares hit a record $2,283 – valuing the Seattle-based company at $1.14 trillion.

The shares continued to climb on Wednesday and were changing hands at $2,295. One month ago they were changing hands at $1,689.

Bezos, who also owns the Blue Origin company aimed at providing passenger flights into space, has faced criticism for not donating more of his fortune to the efforts to tackle the coronavirus and the economic destruction it is causing.

He has so far handed $100m (£80m) to the food bank charity Feeding America; critics have pointed out that the $100m donation made public by Bezos represents less than 0.1% of his fortune.

Amazon has also been accused of not doing enough to protect its workers from the virus. The company this week fired two employees who criticised Amazon over allegedly unsafe conditions at some of its warehouses.

About 75 Amazon warehouses and delivery workers in the US have been infected with the virus, according to the Washington Post, the newspaper owned by Bezos.

The jump in Amazon’s shares came as financial analysts said they expected the company to be crowned “a clear winner” from the Covid-19 crisis and to report record sales and profits this year due to demand for deliveries and its cloud-based services.

Josh Brown, chief executive of Ritholtz Wealth Management, said on Twitter: “Amazon became a utility in this crisis – defensive, reliable, indispensable.”

Analysts at the US investment bank Cowen likened the impact of the lockdown to the Black Friday shopping frenzy in November.

“Covid-19 surge led to ‘Prime Day in March’,” the analyst said in a note to clients. “Amazon has seen an ‘enormous increase in demand’ as shoppers are forced to stay home, essentially creating an extended Prime Day/Black Friday type of situation.”

While many companies across the world have been forced to make staff redundant or place them on government-funded furlough schemes, Amazon is hiring tens of thousands of staff as the business struggles under the weight of orders from consumers trapped at homes all over the world.

The company on Monday said it was hiring an extra 75,000 staff to help it to process the increase in orders. The recruits come on top of 100,000 taken on already since the coronavirus crisis hit western economies last month.

The additional workers will take Amazon’s global workforce to nearly 1 million.

Amazon said: “We know many people have been economically impacted as jobs in areas like hospitality, restaurants and travel are lost or furloughed as part of this crisis. We welcome anyone out of work to join us at Amazon until things return to normal and their past employer is able to bring them back.”

Brent Thill, an analyst at the US investment bank Jefferies, said the hirings were “direct proof consumers are breaking the Amazon supply chain with overwhelming demand”.

Mike Pence, US vice-president, took to Twitter to thank Amazon staff for “working every day to meet the needs of the American people as we face this pandemic together”.

Analysts expect Amazon to increase its annual sales by nearly 20% to reach $335bn.

Amazon on Wednesday threatened to withdraw all deliveries in France, after a French court ruled that it must stop selling “non-essential” items or face a fine of €1m a day.

“Our interpretation of the ruling suggests we might have to suspend the activities of our fulfilment network in France,” an Amazon spokesperson said, “We’re working rapidly to understand the judgment and evaluate our options, and we expect to appeal.”

Joshua Warner, an analyst at the London-based online trading firm IG Index, said: “Amazon shines from all angles during coronavirus crisis. Ultimately, Amazon will remain one of the most important businesses during this crisis, providing key services including food, entertainment and shopping at a time when consumers have fewer retailers to choose from.

“Amazon stock has rocketed to a new record high,” he added. “Of all the firms that might stand to benefit, Amazon is a clear winner.”

Other expanding fortunes

Jeff Bezos is not the only very wealthy person to have seen their fortune swell as a result of the coronavirus outbreak.

Reed Hastings
The founder and chief executive of Netflix has seen his estimated fortune rise by $195m so far this year to $5.1bn as shares in the entertainment service rose by 40% from the market nadir last month. Hastings owns 2.5% of the shares. Analysts said they expected more people stuck at home to sign up to the streaming service. Analysts at Pivotal Research Group said: “We believe the unfortunate Covid-19 situation is cementing Netflix’s global dominance .”

Tim Steiner
The co-founder and chief executive of Ocado has seen his the value of his stake jump 40% over the past month as shoppers flock to online supermarket shopping to avoid busy supermarkets. Steiner owns about 4% of the shares, which are worth more than £400m at current prices. He is also in line for a £59m pay package to be voted on at Ocado’s AGM next month.

The Waltons
The family behind Walmart, which also owns Asda in the UK, have seen their combined net worth rise 5% this year to $169bn. Shares in the US supermarket group have risen 23% from a low on 12 March. The Walton family own 51% of the shares.





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