Top three Cloud players’ quarter roundup
Today, the global cloud computing market is worth around $180bn in vendor revenues for SaaS, PaaS and IaaS, with the market expected to achieve a five year compound annual growth rate of 21.9%. With that in mind, the quarter financial results for the top three cloud giants reveal a steady race to the top of the cloud chain.
Microsoft’s financial results for the quarter ended September 30, 2018, compared to the corresponding period of last fiscal year revealed that revenue was $29.1bn and increased 19%.
- Operating income was $10.0 billion and increased 29%
- Net income was $8.8 billion and increased 34%
- Diluted earnings per share was $1.14 and increased 36%
- Revenue in Intelligent Cloud was $8.6bn and increased 24%
- Server products and cloud services revenue increased 28% driven by Azure revenue growth of 76%
“We are off to a great start in fiscal 2019, a result of our innovation and the trust customers are placing in us to power their digital transformation,” said Satya Nadella, chief executive officer of Microsoft. “We’re excited to help our customers build the digital capability they need to thrive and grow, with a business model that is fundamentally aligned to their success.”
Amazon Web Services
Sales at Amazon Web Services ascended to $7.43bn from $5.11bn a year ago, and AWS revenue represented 10% of total quarterly sales at Amazon.
- Operating income for AWS in the quarter was $2.18bn
Amazon’s financial results for the quarter ended December 31, 2018, compared to the corresponding period of last fiscal year revealed that operating cash flow increased 67% to $30.7bn.
- Net sales increased 20% to $72.4bn in the fourth quarter, compared with $60.5bn in fourth quarter 2017
- Operating income increased to $3.8bn in the fourth quarter, compared with operating income of $2.1 billion in fourth quarter 2017.
- For the full year, net income increased to $10.1 billion, or $20.14 per diluted share, compared with net income of $3.0 billion, or $6.15 per diluted share, in 2017.
Google parent company Alphabet’s financial results for the quarter revealed a profit of $8.9bn, and its revenue grew this quarter to $39.3 billion, up more than 21 percent from $32.3 billion last year.
- Alphabet’s stock price dropped roughly 3%
- Analysts credited the decline to Alphabet’s increased investment in its cloud business, YouTube and other areas
- Google revenues from other categories, including its cloud services and hardware, increased by more than 30% to $6.5bn in the fourth quarter
- Google Cloud showed an annual growth in the cloud infrastructure market in Q4 2018, growing revenues 82% to $2.2bn
Richard Holway, Chairman of TechMarketView said: “On first viewing, Alphabet/Google’s Q4 results exceeded expectations. Indeed revenues were up 22% yoy at $39.3bn but operating profits were up just 7% at $8.2bn. Therefore operating margins dipped 3% to 21% as hardware sales eroded margins and Google invested massively in other bets like its cloud business. Indeed CapEx in Q4 was $7.1bn – nearly doubling for FY18 as a whole.
“We are unsure how successful Google Cloud is as the numbers are not supplied – it has lagged in terms of IaaS market share behind AWS and Azure, but we hear from more and more partners/organisations that are working with it in the data and Machine Learning space.”