Adam Selipsky’s departure as CEO of Amazon Web Services (AWS) was seemingly written in the stars, at least according to current and former employees who spoke to Business Insider. Over recent months, Selipsky’s erratic attendance at the Weekly Business Review meetings had raised eyebrows. During these critical sessions, various teams update senior leadership on their performance, making his absences all the more glaring. Over his three-year tenure, Selipsky led AWS to a record-breaking $100 billion revenue run rate, thanks in part to customers ramping up spending post-COVID. However, this milestone coexisted with mixed results, particularly as AWS began trailing behind in the booming generative AI market.
AWS spokesperson Patrick Neighorn was quick to defend the company’s performance, emphasizing AWS’s continued growth, innovation, and profitability. He noted that AWS has been the leader in operational performance, security, reliability, and the depth and breadth of its offerings. Still, the numbers tell their own story: AWS had the highest absolute dollar growth quarter-over-quarter compared to other cloud providers so far this year. Yet, despite these assurances, cracks were appearing in the facade, prompting a major shakeup at the helm.
On Tuesday, Amazon announced that Matt Garman, AWS’s sales and marketing chief, would be replacing Selipsky as CEO. Garman had long been seen as the heir apparent to Andy Jassy, the former AWS CEO who took over as Amazon’s CEO in 2021. Insiders had pegged Garman as the right choice due to his blend of technical expertise and business acumen. In contrast, Selipsky’s appointment had been a surprise to many, given his departure from AWS in 2016 to run Tableau, and his perceived lack of technical depth. Some insiders even branded him as “just a sales guy” or “uninspiring,” particularly as AWS grappled with unprecedented competition in the generative AI space.
The generative AI sector has become the new battleground for cloud providers, and AWS under Selipsky found itself in a precarious position. The pandemic and an uncertain economy led to slower growth rates, with customers cutting back on their cloud spending. However, recent indications suggest a rebound, as Amazon reported that “cost-optimization” efforts by clients are largely complete, with AWS experiencing a 17% year-over-year growth in its most recent quarter. Yet, this progress was overshadowed by job cuts in April, part of Amazon’s larger strategy to tighten the purse strings.
Selipsky’s exit may be emblematic of a broader struggle within AWS to maintain its leadership amidst rapid technological shifts and intense competition. With Matt Garman stepping into the role, there is renewed hope that AWS can regain its footing and drive forward in the high-stakes world of cloud computing and generative AI. While the road ahead is fraught with challenges, Garman’s blend of technical know-how and business strategy could be the winning formula AWS needs to navigate the turbulent waters of the modern tech landscape.