Jeff Bezos touts Alexa adoption, AWS, and wage hikes in shareholder letter

In his annual letter to Amazon shareholders, CEO Jeff Bezos challenged other retailers to match the company’s $15-an-hour minimum wage.

“Today I challenge our top retail competitors (you know who you are!) to match our employee benefits and our $15 minimum wage,” he wrote. “Do it! Better yet, go to $16 and throw the gauntlet back at us. It’s a kind of competition that will benefit everyone.”

The company set the wage floor last year amid criticism of working conditions in its sprawling warehouses and said it would lobby U.S. Congress for a higher federal minimum wage.

Other takeaways from the letter include:

Bezos reports that roughly 58% of physical merchandise sales through Amazon are attributable to third-party sellers, who brought in $160 billion last year compared to Amazon direct sales of $117 billion. “Third-party sellers are kicking our first-party butt,” Bezos wrote, attributing their success to tools built by Amazon, including the Prime subscription program and Fulfillment by Amazon distribution service.
Amazon is continuing to invest in bringing machine learning to users of its $30 billion Amazon Web Services business, including through its SageMaker tool. “We continue to enhance the service, including by adding new reinforcement learning capabilities,” he wrote. “Reinforcement learning has a steep learning curve and many moving parts, which has largely put it out of reach of all but the most well-funded and technical organizations, until now.”
Customers have bought more than 100 million devices equipped with Alexa, Amazon’s virtual assistant, Bezos wrote, celebrating the rapid success of the company’s Echo smart speakers. “If you had gone to a customer in 2013,” he wrote, “and said, ‘Would you like a black, always-on cylinder in your kitchen about the size of a Pringles can that you can talk to and ask questions, that also turns on your lights and plays music?’ I guarantee you they’d have looked at you strangely and said, ‘No, thank you.’”
More than 16,000 employees have taken part in Amazon’s Career Choice program, which can see the company pay up to 95% of tuition and fees for qualifying degree and certificate programs.