Amazon CEO Jeff Bezos to Transition to Executive Chairman

The surprise announcement came as Amazon capped off its pandemic-fueled 2020 financial performance with record quarterly sales driven by a surge in online holiday shopping with people stuck at home.

The e-commerce giant posted fourth-quarter sales of $125.5 billion and net income of $7.2 billion. It marked the first time Amazon reported more than $100 billion in quarterly revenue, days after Apple Inc. hit that financial milestone.

Few companies have seen growth take off like Amazon during the global health crisis. The explosion in online shopping vaulted the company’s sales to record figures as the e-commerce sector grew by around 50% throughout last year, according to some analysts. Roughly 40% of online shopping in the U.S. happens at Amazon, according to research firm eMarketer, helping drive a 76% increase in the company’s share price last year and raising its market valuation to more than $1.6 trillion.

Sales in the December quarter received an added boost from Amazon’s annual “Prime Day” shopping event moved from its usual summer schedule to October due to the pandemic. Amazon makes billions from the two-day event.

Amazon sales for all of 2020 rose 37% year-over-year to $380.06 billion and are expected to advance again this year. Amazon said sales for the current quarter should come in at between $100 billion and $106 billion. Wall Street has forecast sales of around $95.8 billion.

The online shopping boom has been broad based.

United Parcel Service Inc.

Tuesday said sales in the December quarter rose 21%. The package delivery giant said Amazon accounted for 13.3% of its total 2020 sales.

Corrections & Amplifications
Amazon.com is making a repayment of driver tips it withheld to the Federal Trade Commission. An earlier version of this article incorrectly called the repayment a fine. (Corrected on Feb. 2)

Write to Sebastian Herrera at Sebastian.Herrera@wsj.com