Jeff Bezos: It’s All About the Long Term

Jeff Bezos: It’s All About the Long Term

We believe that a fundamental measure of our success will be the shareholder(ˈSHerˌhōldər) value we create over the long term. This value will be a direct result of our ability to extend and solidify(səˈlidəˌfī) our current market leadership position. The stronger our market leadership, the more powerful our economic(ˌekəˈnämik) model. Market leadership can translate directly to higher revenue(ˈrevəˌn(y)o͞o), higher profitability(ˌpräfədəˈbilədē), greater capital(ˈkapədl) velocity(vəˈläsədē), and correspondingly(ˌkärəˈspändiNGlē) stronger returns on invested capital.

Our decisions have consistently reflected this focus. We first measure ourselves in terms of the metrics(ˈmetriks) most indicative of our market leadership: customer and revenue growth, the degree to which our customers continue to purchase from us on a repeat basis(ˈbāsəs), and the strength(streNG(k)TH) of our brand. We have invested and will continue to invest aggressively(əˈɡresivlē) to expand and leverage(ˈlev(ə)rij) our customer base, brand, and infrastructure(ˈinfrəˌstrək(t)SHər) as we move to establish an enduring(inˈd(y)o͝oriNG) franchise(ˈfranˌCHīz).

Because of our emphasis(ˈemfəsəs) on the long term, we may make decisions and weigh(wā) tradeoffs(trād) differently than some companies. Accordingly, we want to share with you our fundamental management and decision-making approach so that you, our shareholders, may confirm that it is consistent(kənˈsistənt) with your investment philosophy(fəˈläsəfē):

We will continue to focus relentlessly(rəˈlentləslē) on our customers.

We will continue to make investment decisions in light of long-term market leadership considerations rather than short-term profitability considerations or short-term Wall Street reactions.

We will continue to measure our programs and the effectiveness of our investments analytically(ˌanəˈlidik(ə)lē), to jettison(ˈjedəsən) those that do not provide acceptable returns, and to step up our investment in those that work best. We will continue to learn from both our successes and our failures.

We will make bold(bōld) rather than timid(ˈtimid) investment decisions where we see a sufficient(səˈfiSHənt) probability of gaining(ɡān) market leadership advantages. Some of these investments will pay off, others will not, and we will have learned another valuable lesson in either case.

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We aren’t so bold as to claim that the above is the “right” investment philosophy, but it’s ours, and we would be remiss(rəˈmis) if we weren’t clear in the approach we have taken and will continue to take.

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https://blog.aboutamazon.com/company-news/2019-letter-to-shareholders