Cloud Hits New Highs as Microsoft and Amazon Talk Quarterly Revenues

As quarterly reports begin to roll in, cloud continues to highlight the balance sheets while providing the most room for growth.
Microsoft is transforming itself into a cloud software business. With the new release of Windows 10 which includes baked in cloud functionalities, it’s pretty easy to see that Microsoft sees itself as a cloud company going forward.
In the latest Microsoft earnings report, Microsoft reported that it received a 70% increase in revenues from its commercial cloud services such as Azure.
Amazon Web Services, which reports its earnings along with its parent company Amazon, also released revenue numbers that show a similar trend. AWS says that its cloud related revenues shot up by 79% over the last quarter. For Amazon, this translated into $2.09B in cloud revenues in the last quarter alone.
Shift back to Microsoft, the software giant did well on cloud, but some of its other areas of expertise didn’t fair so well. For example, licensing fees from desktop PC manufacturers dropped 6% over the last quarter. As businesses embrace the work from anywhere mentality, hardware becomes less important, especially when all of the computing and data storage of your operation is being done in the cloud.
While Microsoft sells other IT related items besides cloud, Amazon relies on its ecommerce platform. It’s fair to say that while Amazon started out in the ecommerce realm, Amazon has earned the right to become viewed as a cloud company that just happens to do online retail.
AWS’s revenues from cloud may not deliver a huge profit margin for Amazon but the services do bring in several billion of the companies projected $30+ billion in quarterly revenue. Both Amazon and Microsoft believe that their core offerings in the future will be cloud based, which can easily evidenced by the rapid booms in revenue reported by each company in their quarterly reports.

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