A brief history of Amazon: From Jeff Bezos' garage to a $2 trillion market cap

Princeton graduate Jeff Bezos started Amazon out of his garage in Washington state on July 5, 1994 under the name “Cadabra” — as in “abracadabra” — but changed it because it sounded too much like “cadaver.” The company launched its website one year later, becoming an online bookstore that delivered to 45 countries.

Amazon listed on the Nasdaq on May 15, offering 3 million shares at an initial $18 per share.

“Although the company has yet to produce net profit, several analysts say...they expect the company to rake in revenue in the multimillion-dollar range within a few years,” the Wall Street Journal reported at the time.

In the summer of 1998, Amazon said that it would sell a larger variety of goods, including clothing and computers. The New York Times reported at the time that Amazon was “the most successful merchant on the Internet” with just over 3 million customers.

Amazon laid off 1,300 employees, including workers in Seattle that had been part of union organizing efforts, raising concerns from the Washington Alliance of Technology Workers union that they had been targeted. Amazon told 450 of the 850 employees laid off in Seattle that, if they wanted severance, they had to sign a clause giving up their rights to sue the company and promise “not to make any derogatory comment in any format whether written, electronic, or oral, to the press or any individual or entity regarding the company,” Wired reported at the time.

Amazon launched its express shipping service, Amazon Prime, for a price of $79 per year, during its 2004 fourth quarter earnings report.

“Amazon Prime is ‘all-you-can-eat’ express shipping,” CEO Jeff Bezos said in a statement at the time (February 2005). “Though expensive for the Company in the short-term, it’s a significant benefit and more convenient for customers.”

The offering didn’t become widely popular until years later, reaching over 100 million subscribers in 2018.

The Morning Call newspaper in Allentown, Pennsylvania exposed deplorable working conditions in an Amazon warehouse. The paper reported that Amazon was hiring paramedics and ambulance drivers to treat workers collapsing in its warehouse without air conditioning. At one point, the heat index reached 102 degrees Fahrenheit, and 15 workers collapsed.

“Those who couldn’t quickly cool off and return to work were sent home or taken out in stretchers and wheelchairs and transported to area hospitals. And new applicants were ready to begin work at any time,” The Morning Call’s Spencer Soper wrote at the time.

On another day, the third floor of the warehouse reached 110 degrees.

“I remember going up there to check the location of an item,” one employee told The Morning Call at the time. “I lasted two minutes, because I could not breathe up there.”

In the years since, Amazon has been criticized for intimidating workers and crushing unionization efforts.

Amazon bought Whole Foods Market for $13.7 billion in June as it looked to gain a stronger foothold in the grocery market, offering $42 in cash for each share. The move marked its largest acquisition to date.

Amazon became the second U.S. company to reach a $1 trillion market cap in September, after shares of the company climbed 1.9% to push its value past the $1 trillion threshold. It briefly joined Apple in the above-$1 trillion club, but fell back down to $990 billion minutes later.

Amazon once again passed the $1 trillion threshold after beating Wall Street’s expectations for its 2019 fourth quarter earnings. The company’s stock rose 9% in early trading on January 31, pushing its valuation to $1.02 trillion. However, Amazon closed the day with a market value of $995.9 billion.

Jeff Bezos announced he would step down as CEO of the company at the end of the year and become its executive chair. In his last letter to Amazon’s shareholders as CEO, Bezos talked about the company’s employees, customers, biology, and death.

More than 2,600 workers in Staten Island voted to join the first Amazon union in the U.S. in April, just as the company’s regulatory scrutiny over labor law violations mounted. The union win came just as the company faced separate, financial woes. Amazon’s market capitalization fell to $879 billion in November — down from a record $1.88 trillion from July 2021. The staggering loss made it the first public company in the world to lose $1 trillion in market value.

Since the first employees unionized in Staten Island, Amazon workers have inspired a resurgence in unionization efforts nationwide. But Amazon has been accused of suppressing union activity and cracking down on efforts to unionize its workers in other states. Amazon has resisted bargaining with the union, which has yet to secure its first contract.

Amazon completed its $4 billion investment in artificial intelligence startup, Anthropic. The company initially invested $1.25 billion in the startup in September 2023, and announced an additional $2.75 billion in March.

Its push into AI helped Amazon crossed the $2 trillion market cap threshold for the first time. The company is reportedly working on an AI chatbot, internally called “Metis,” to rival OpenAI’s ChatGPT. It joined Google-parent Alphabet, which reached a $2 trillion valuation in April.

Around the same time, Amazon was fined nearly $6 million for 59,000 violations of California labor laws.