Dive Brief:
- Looking at reports of quarterly earnings, cloud technology is helping tech companies stay strong, even as the PC market shrinks and ecommerce struggles.
- Microsoft, Amazon and Alibaba all saw solid cloud growth last quarter and say they will continue to invest heavily in the area.
- Gartner predicts the worldwide market for public cloud systems overall will reach $204 billion in 2016.
Dive Insight:
Microsoft announced this week that its commercial cloud annualized revenue run rate jumped to $9.4 billion last quarter, up from $8.2 billion the quarter before. The company's server and Azure cloud services rose 5% to $6.3 billion.
"Microsoft’s cloud success can no longer be looked as a 'one-off' or luck, it’s becoming a giant business that could give Amazon a run for its money," said Patrick Moorhead, president of Moor Insights and Strategy, in an interview with USA Today.
Cloud computing was a bright spot for Amazon as well. Its cloud-computing division had sales of $2.4 billion last quarter, up 69% from a year earlier.
And while Alibaba’s ecommerce division has experienced some slowdown, the company is betting on cloud computing to drive future growth. Earlier this month, Alibaba said it plans to invest $1 billion in AliCloud, its cloud division, in hopes of expanding business in the U.S. and competing against Amazon Web Services.
