For Amazon & Microsoft, the Cloud Keeps Giving

Craig Matsumoto

Someday, the consistent growth in sales for AWS and Microsoft Azure will have to stop.

"Someday" wasn't today. Amazon Web Services Inc. reported third-quarter sales of $4.6 billion, representing revenue growth of roughly 42% year-over-year, same as the previous quarter. Microsoft Corp. (Nasdaq: MSFT) reported that Azure grew 90% year-over-year during the company's first fiscal quarter, which ended Sept. 30 -- again matching the growth trend of recent quarters.

Microsoft doesn't specify Azure's revenues, but the company did say the Intelligent Cloud division, which includes Azure, reported sales of $6.9 billion, up 14% year-over-year.

Ever since Inc. (Nasdaq: AMZN) started breaking out AWS revenues, it's been clear that the cloud is carrying the company's profitability. That was evident this past quarter as well. Amazon's total operating income was $347 million, while AWS's operating income came in at $1.17 billion.

Overall, Amazon reported revenues of $24.7 billion, compared with $21.1 billion in the same quarter last year. The company's net income was $197 million, or $0.40 per diluted share, compared with $857 million, or $1.78 per share, a year ago.

Microsoft reported first-quarter revenues of $24.5 billion, versus $21.9 billion a year ago. Net income was $6.6 billion, or $0.84 per share, compared with $5.7 billion, or $0.72 per share, a year ago.

— Craig Matsumoto, Editor-in-Chief, Light Reading

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10/30/2017 | 12:13:48 PM
How many clouds can the market support?
Google's cloud is catching on, and there are also players like Oracle and IBM trying to grab marketshare, too. If there aren't any significant (service provider imposed) barriers to migrating, customers might be able to operate on multiple clouds simultaneously or sequentially. 
10/28/2017 | 8:27:28 AM
Growth for Some Time
While you're right that at some point the growth has to drop off, with the evolution of IoT and the flood of data that will come from these devices, the drop off won't occur for quite some time.
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