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Cloud computing drives growth for big US tech firms

Amazon Web Services is still delivering far more revenue than any of its peers

Salvador Rodriguez | Reuters 

cloud computing, technology, AI, artificial intelligence

com, Microsoft, Alphabet’s and are all putting their chips on the business, and it is booming. All four companies posted stellar quarterly earnings on Thursday, showing the strength of the shift in corporate computing away from company-owned data centers and to the cloud. Microsoft’s Azure business nearly doubled, with year-over-year growth of 90 per cent. The company does not break out revenue figures for Azure, but research firm Canalys estimates it generated $2 billion for “The move to the cloud was one we felt could always benefit from, and they’re showing us that they can,” said Kim Forrest, vice president and senior equity analyst at Fort Pitt Capital Group, a portfolio management firm. Highlighting the quarter for was a deal securing retailer Costco as an Azure customer. That came just two months after the close of Amazon’s acquisition of grocery chain Whole Foods, which has heightened unease among retail and e-commerce companies about working with Amazon, said Ed Anderson, an analyst with Gartner.

Tim Green, analyst with the Motley Fool, said could find it needs to make changes at some point at Web services. “Spinning off AWS at some point down the road might become necessary to prevent an exodus of customers,” he said. Web Services is still delivering far more revenue than any of its peers. For the quarter, AWS raked in nearly $4.6 billion — a year-over-year increase of 42 per cent. AWS may have missed out on Costco, but the company secured deals with Hulu, Toyota Racing Development, and most notably, General Electric. Cloud Platform landed deals with the likes of department store retailer Kohl’s and payments processor PayPal.

First Published: Fri, October 27 2017. 23:55 IST
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