Bezos overtakes Gates to become richest in world

A surge in Amazon.com Inc shares on Thursday morning in advance of the online retailer’s earnings report has propelled founder Jeff Bezos past Bill Gates as the world’s richest person.

Bezos owns about 17 per cent of Seattle-based Amazon, which has surged 40 per cent this year through Wednesday, helping to add $24.5 billion to his net worth. He started 2017 as the world’s fourth-wealthiest person and has since surpassed Buffett and Inditex SA founder Amancio Ortega, 81, who ranks third with $82.7 billion.

Shares of the online retailer rose 1.3 per cent to $1,065.92 at 10:10 am in New York, giving Bezos a net worth of $90.9 billion, versus $90.7 billion for Gates. If that holds through the 4 pm close, Bezos, 53, will leapfrog Gates, the Microsoft Corp co-founder, on the Bloomberg Billionaires Index. Gates, 61, has held the top spot since May 2013.

Investors and analysts will be scrutinising how many new subscriptions the retailer sold for its $99-a-year Amazon Prime service, which offers delivery discounts and video and music streaming.
Prime shoppers spend more than customers who don’t have a membership.

“Amazon Prime is why so much physical retail is going away,” said Michael Pachter, a Wedbush Securities Inc analyst who has a buy rating on the stock and a price target of $1,250. “Anyone who joins Prime shops in retail st­o­res 10 per cent less, and that number will keep accelerating as Amazon adds more inventory,” Pachter said.

Investors also monitor Amazon’s cloud-computing division, Amazon Web Services, a fast-growing and profitable business that accounts for about 10 per cent of revenue. Amazon leads the cloud-computing industry, but faces increasing competition from Microsoft and Google parent Alphabet Inc.

Amazon is expected to post quarterly revenue of $37.2 billion, a 22 per cent jump from a year earlier, according to the average estimate of 34 market analysts surveyed by Bloom­b­erg, and earnings per share of $1.42.

Meanwhile, Facebook’s  Inc’s intraday gains have helped pull co-founder Mark Zuck­e­rberg, 33, within $200 million of Berkshire Hathaway chairman Warren Buffett, 86, who’s currently ranked fourth on the Bloomberg index with a net worth of $74.5 billion.