Amazon founder and CEO Jeff Bezos lost the world’s richest man title during after-hours trading, losing about $7 billion.
- Jeff Bezos’ fortune came down to $103.9 billion after Amazon shares fell 7% in after-hours trading.
- The crash resulted from the E-commerce giant lowering its predictions for quarterly sales.
- Bezos is overtaken by Microsoft founder Bill Gates whom he replaced at the top in 2018.
Amazon shares fell 7% in after-hours trading, knocking Jeff Bezos’ fortune down to $103.9 billion. That took him off the perch among the world’s richest. So, the new number one is again Microsoft co-founder Bill Gates, who is worth $105.7 billion.
Jeff Bezos lost almost USD 7 billion in the Amazon stock crash, demoting him to number two on the ‘World’s Richest’ List.
Jeff Bezos became the richest man in the world in 2018. He also became the first centi-billionaire to ever appear on The Forbes 400. With a net worth of $160 billion, he ended Gates’ 24-year run as number one.
Jeff Bezos lost about $7 billion on Thursday https://t.co/h5zgJ3Z8bz— CNBC (@CNBC) October 24, 2019
But the Amazon chief executive’s net worth drop isn’t entirely due to the decline in Amazon shares. The major factors are the global economic slowdown and a more personal parameter of a world record divorce settlement.
No more World’s Richest
Bezos transferred a quarter of his Amazon share to ex-wife MacKenzie for the divorce settlement finalized earlier this year.
Jeff’s wife MacKenzie Bezos is worth $32.7 billion, and also among the top twenty wealthiest people in the world.
On October 24, Amazon reported a 26% drop in net income in Q3, its first profit decline since 2017.
MacKenzie Bezos is ‘Richer’ by heart!
The Bezoses announced their divorce settlement via twitter with Jeff Bezos keeping the majority of his stake and thus, control of Amazon.
The world’s richest couple decided to part after reports came out in January of Jeff Bezos’ extra-marital affair with a TV Host.
In a sacrifice that worked in the favour of Amazon’s investors, MacKenzie Bezos relinquished 75% of her stake in the company and all voting rights to her billionaire ex-husband Jeff Bezos.
As part of their divorce settlement, she had also given up her interests in the Washington Post (bought in 2013) and Bezos’ rocket company Blue Origin (founded in 2000).
MacKenzie, who had been a pillar in Amazon’s inspiring journey early on, had been married to Jeff Bezos for 26 years, before Jeff Bezos’ extra-marital affair with TV host Lauren Sanchez went public, after a scoop by the National Enquirer.
Amazon invested $800 million in one-day shipping
The Seattle based e-commerce firm said it is investing heavily in logistics and delivery infrastructure. The goal of the investment is to make one-day shipping the norm for Amazon Prime members.
Amazon disclosed in July that it had spent a little bit more than the estimated $800 million. It previously said it would invest in one-day shipping.
The company declined to disclose how much it had spent on one-day shipping in the third quarter.
Plans for next quarter for Amazon
Bill Gates, meanwhile, has been out of Microsoft since 2014 when he stepped down as chairman. However, he remains a board member.
However, Bill Gates sold or gave away the majority of his Microsoft stake and also diversified his wealth over time. He now co-chairs the Bill & Melinda Gates Foundation, the world’s largest private charitable foundation.
Bill Gates debuted on Forbes’ first-ever billionaire list in 1987 with a net worth of $1.25 billion. Jeff Bezos first joined The Forbes 400 list of richest Americans in 1998. This was also one year after Amazon went public, with a net worth of $1.6 billion.
Amazon’s revenue is still up, but it downgraded expectations for the first time
Financial analysts had predicted that the launch of one-day shipping would eat into Amazon’s earnings, but even with the forewarning investors pummeled the stock after the market closed.
Moreover, the good news for Amazon amidst all the bad news was that revenue was actually up at the company. For the quarter Amazon raked in $70 billion, beating analysts’ expectations of $68.8 billion.
However, the company reported a profit of $2.1 billion, or $4.23 a share versus the $4.62 that analysts had projected. And even though sales were up this year, earnings per share were down from $5.75 in the year-ago period.
- On October 24, Amazon reported a 26% drop in net income in Q3, its first profit decline since 2017.
- Bezos transferred a quarter of his Amazon share to ex-wife MacKenzie for the divorce settlement finalized earlier in 2019.
- However, the good news for Amazon amidst all the bad ones is that revenue was actually up, beating analyst predictions by $1.2 billion.