Category Archives: Cloud Computing
The 3 Best Cloud Computing Stocks to Buy in Q2 2024 – InvestorPlace
If youre considering the best cloud computing stocks to buy, you might want to read a February article from InfoWorld contributor David Linthicum that details why companies are leaving the cloud.
Linthicum is a computer industry expert whos not just written numerous books about it, his latest published in 2023 focuses on cloud computing, but he has extensive his industry experience. He has served in roles such as CTO and CEO of several software companies.
His argument about why UK companies are moving their cloud-based workloads back to on-premises infrastructure is very straightforward.
The cloud is a good fit for modern applications that leverage a group of services, such as serverless, containers, or clustering. However, that doesnt describe most enterprise applications, Linthicum wrote on Feb. 9.
While public cloud providers are losing business as enterprises return to on-premises infrastructure, theyll gain hugely from generative AI applications and data.
With this in mind, here are three of the best cloud computing stocks to buy.
Source: Asif Islam / Shutterstock.com
Microsoft (NASDAQ:MSFT) is one of the world leaders in cloud computing through Azure, the companys cloud computing platform. In Q2 2024, Microsofts Cloud revenue was $33.7 billion, 24% higher than Q2 2023, a fair chunk of it from Azure. For example, Microsofts Azure AI had 53,000 customers at the end of the second quarter, CEO Satya Nadella said during its conference call, one-third of them completely new to Azure.
Im pretty confident that Linthicum is 500 times brighter than myself regarding anything computer-related. However, based on what he wrote in his InfoWorld commentary, I would bet dollars to donuts, and hed agree that Microsoft will be one of the long-term beneficiaries of generative AI and the public cloud.
Ive read articles about Microsoft making lots of money while customers gain little.
Fortune reported comments from GitHub COO Kyle Daigle in early February about AI.
Daigle said the companies finding the most success implementing Copilot are those that are integrating it into their workflows and not just adding an AI button or chatbot window because its the hot thing to do. Fortune contributor Sage Lazzaro wrote on Feb. 1.
Microsoft will figure out how to make its clients happy.
Source: Daniel Fung / Shutterstock
Amazon (NASDAQ:AMZN) has a massive cloud business through AWS. Nashville-based eWeek.com recently rated the top 20 generative AI companies in 2024. Amazon made the list. Not surprisingly, many of the names were private companies. Expect many of them to go public or acquire in the next few years.
eWeek said Amazon was the best for generative AI as a service.
AWSs customers for generative AI range from small startups to major enterprises and brands like Intuit, Nasdaq, Adidas, and GoDaddy. In addition to its managed services and knowledgeable in-house support specialists, customers can benefit from a diverse partner network and the AWS Marketplace, eWeek stated on March 14.
It offers four AI solutions: Amazon Bedrock, Amazon SageMaker, Amazon Q, and Amazon CodeWhisperer. I wont be checking out the last one anytime soon, but I digress.
It also invested another $2.5 billion in Anthropic, bringing its total investment in the AI startup to $4.0 billion. Anthropic uses AWS for the cloud and some of the companys specialized computing chips. Expect more developments in the future.
What I love about Amazon is that its always looking for large revenue generators for the long haul. Its willing to spend obscene money if it sniffs a massive market. They dont get much bigger than generative AI.
Just as its turned advertising into a significant revenue generator, it will likely do the same with AI sooner than investors realize.
Source: Piotr Swat / Shutterstock.com
When I first saw the name C3.ai (NYSE:AI), I thought it was a fly-by-night operation. Investors still doubt whether its got the right stuff when it comes to AI. This apprehension is reflected in the share price. Its down more than 5% in 2024 and up just 6% over the past year despite AI being the hottest thing since sliced bread.
Even when it reported better-than-expected third-quarter results at the end of February, it couldnt hang on to the 25% single-day gain on the news. The day before announcing earnings, its share price closed at $29.69. Its down 8.8% in the month since.
However, Siebels got the company focused squarely on generative AI. It mentions the two words 18 times in its Q3 2024 press release.
The companys press release stated, C3 Generative AI continues to gain traction with organizations that rely on technology solutions to produce accurate information and process highly sensitive data.
Long story short, it continues to grow revenues by double digits each quarter while losing millions on a non-GAAP basis.
Its the riskiest of the three cloud computing stocks. If youre an aggressive investor, the risk/reward proposition suggests its worth a small bet.
On the date of publication, Will Ashworth did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Will Ashworth has written about investments full-time since 2008. Publications where hes appeared include InvestorPlace, The Motley Fool Canada, Investopedia, Kiplinger, and several others in both the U.S. and Canada. He particularly enjoys creating model portfolios that stand the test of time. He lives in Halifax, Nova Scotia.
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The 3 Best Cloud Computing Stocks to Buy in Q2 2024 - InvestorPlace
Federal IT Budget for cloud computing hits $8.3bn in FY 2025 – report – DatacenterDynamics
Cloud computing spending in Fiscal Year (FY) 2025 could reach $8.3bn for federal civilian agencies.
According to research published by government contract database firm GovWin IQ as part of its Federal Market Analysis, the total budgets for cloud computing technology have almost doubled since 2020.
Actual cloud spending in 2020 reached $4.4bn, while the request budget for 2025 is as much as $8.3bn.
A notable jump occurred between FY2023 and 2024. Previously, budgets had been growing around $400 million per year, however, in this period it jumped by $2.2bn.
GovWin IQ noted that federal civilian agencies stopped reporting on their spend on cloud computing "several years ago," but that when still published, the results tended to be "wildly inconsistent" with the verified cloud contract spending data that the Federal Market Analysis would find.
To get around this lack of transparency, GovWin IQ ran all of its "cloud market keywords" against the program descriptions listed in the IT portfolio which can be accessed via the government's IT Dashboard. Through this process, those civilian agency programs using cloud technology or planning to in the next year can be viewed.
Across FY 2023 to 2025, the civilian agency with the largest cloud computing budget was the Treasury, at $5.054bn, followed by the Department of Health and Human Services (HHS) at $2.686bn. Of the ten agencies shared in the research, the Department of Veterans Affairs had the smallest budget at $718m.
GovWin IQ noted this smaller budget: "The VA has been among the civilian agencies spending the most on cloud computing annually for the last several years, and yet here was the VA coming in tenth compared to smaller agencies such as the Social Security Administration."
GovWin suggested that this demonstrates the limitations in the reported data by federal agencies, and that there could be "dozens of VA investments" that use cloud technology yet fail to mention the cloud or other solutions known to be cloud-based, thus not being shown in the results.
Similarly, GovWin IQ points to the Treasury leading the pack as a surprising outcome, as the Treasury's cloud journey has been "long and slow." This has changed in the last couple of years, according to GovWin IQ.
"The Treasury ramped up its budget for cloud services from $515m in FY 2023 to $2.2B in FY 2024," noted the report.
"This jump partially explains the rise in the total market from FY 2023 to 2024. In FY 2025, the Treasury then requested an additional $2.4bn, illustrating how it is making a full-on enterprise push into the cloud."
Overall, despite gaps in reporting, the data suggests massive moves toward the cloud across federal agencies.
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Federal IT Budget for cloud computing hits $8.3bn in FY 2025 - report - DatacenterDynamics
3 Sorry Cloud Computing Stocks to Sell in March While You Still Can – InvestorPlace
These cloud computing stocks are seriously underperforming the broader market
The present and future of the internet is in cloud computing. This branch of computing is the backbone of digital transformation in modern enterprises. It enables businesses to access, store and process data and applications over the internet, rather than having to rely on in-house servers.
Of course, not all cloud computing businesses have made great investments as of late. The fact of the matter is, cloud computing, despite its advantages, is still costly for a lot of firms, and in times of economic uncertainty, not all firms are ready to make the switch over to the cloud. This means the market is highly competitive and customer acquisition is not always straightforward. Stepping away from the dynamics of the market for a second, there are also inflated valuation multiples to take into account.
Below are three sorry cloud computing stocks to sell in March while you still can.
Source: Sundry Photography / Shutterstock
Snowflake(NYSE:SNOW) is a software platform that essentially serves as a cloud-based data warehouse allowing customers to store and analyze large amounts of data. The cloud computing company received a COVID bump as the work-from-home trend became a reality for many white-collar professionals during the pandemic years. In the beginning, Snowflake essentially revolutionized data warehousing, most of which used to be on-prem, byestablishing a cloud network around data storage and charging reasonable prices based on utilization. From 2019 to 2021, Snowflake was able to grow revenue in triple-digit YoY growth rates.
In both 2022 and 2023, we have seen revenue growth rates nearly halve. Slower growth is expected given the way the global economy has struggled with high inflation and elevated interest rates. Snowflake still remains pessimistic on growth. In their Q4 earnings print, while financial figures came in above Wall Streets estimates, sales guidance for their upcoming fiscal year came in much lower than expected. Also, an announced CEO change hasnt inspired investor confidence either.
Snowflake is not only trading at an insane P/E multiple, but the stock has already plummeted 20% on a year-to-date basis, making it one of the cloud computing stocks to be selling in March.
Source: Pavel Kapysh / Shutterstock.com
Fastly(NYSE:FSLY) is another cloud computing stock investors should avoid. It is a cloud-based edge computing platform that provides content delivery network (CDN) and security services to customers such as Shopify (NYSE:SHOP) and Spotify (NYSE:SPOT). For those unaware, having a CDN helps customers to affordably store content and data on servers. Because a CDN is a distributed network, users of a website or app can quickly pull up content because they would have access to the closest server.
Fastly has, like many cloud companies, experienced falling top-line growth rates in recent years. The companys recent Q4 earnings report failed to impress investors. Fourth quarter revenue figures came in below Wall Streets estimates and 2024 guidance left much to be desired.
The cloud computing firms share price has fallen 28% YTD, and its high forward earnings multiple does not indicate the stock could recover anytime soon.
Source: Karol Ciesluk / Shutterstock.com
Datadog(NASDAQ:DDOG) is acloud-based monitoring and analytics platformthat helps customers track the performance and health of their applications, infrastructure and services. Driving Datadogsstrong revenue growth throughout the yearshas been the rise of SMBs (small and medium-sized enterprises) and large enterprises utilizing cloud-based applications and services.
The companys Q4 earnings report appeared as a return to form as revenue and guidance came in well-above Wall Streets estimates. Still, Datadogs forward price-to-earnings multiple makes little sense trading at 85.8x forward earnings. The stock itself has also exhibited meek performance, trading relatively flat on a year-to-date basis.
While Datadog is not the worst performing stock on this list, its underperformance when compared to rest of the market and high valuation makes it a must-sell in March.
On the date of publication, Tyrik Torres did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.comPublishing Guidelines.
Tyrik Torres has been studying and participating in financial markets since he was in college, and he has particular passion for helping people understand complex systems. His areas of expertise are semiconductor and enterprise software equities. He has work experience in both investing (public and private markets) and investment banking.
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3 Sorry Cloud Computing Stocks to Sell in March While You Still Can - InvestorPlace
Gray Skies Ahead? 3 Cloud Stocks That Will Be Gone in 10 Years – InvestorPlace
Investors have made a ton of money in cloud computing stocks over the past 15 years. The transformation from on-premise to off-premise software, data storage, and security has been truly revolutionary for the technology industry.
But at some point, a concept may get played out. And it seems like were reaching that point with cloud computing. The concept is hardly novel at this point, and a great deal of software-as-a-service (SaaS) vendors have already fully adopted cloud solutions into their product ecosystems.
In other words, while cloud computing was a megatrend that delivered huge profits for early adopters, there are no guarantees that newer firms will be able to find similar success in coming years. These are three cloud computing stocks to avoid that dont seem like they have found the recipe for long-term success in the industry.
Source: shutterstock.com/Leonid Sorokin
Hub Cyber Security (NASDAQ:HUBC) is a small Israeli company focused on cybersecurity and quality and reliability systems. It operates the following segments: Consulting, software, training, and software testing and outsourcing.
The company was flying under the radar until October 2023. On October 9th, 2023 shares more than doubled in a single day following the Hamas attacks in Israel. Traders seemingly concluded that Hub Cyber Security would see an influx of new business as the Israeli government and businesses responded to the geopolitical unrest.
Since then, however, HUBC shares have lost most of their value. In fact, the stock is now down 95% over the past year. It has also replaced its CFO and CEO in short order. The company is also enacted a reverse stock split to get back in-line with Nasdaq listing compliance late last year. But with the stock already back in penny stock territory, HUBC stock may have to take more actions to get its share price back above a dollar.
All this looks like a typical SPAC deal gone bad; a fledging cloud technology company with a small revenue base and sizable operating losses that will struggle to stick around for the long haul.
Source: Al Serov / Shutterstock.com
Rekor Systems (NASDAQ:REKR) is a small business that has been involved in a variety of different undertakings in recent years. The company at one point was involved in crisis management, consulting, traffic solutions, secure education, and strategic back office services among others. There was a push for AI-driven machine learning at another point.
Not surprisingly, REKR stock attracted trader interest as an AI penny stock in 2023. However, Rekor Systems was unable to convert the visibility into any lasting momentum in the business operations or share price.
Rekors most recent earnings report once again fell short of expectations. Despite all the mergers and acquisitions and numerous press releases, Rekor has struggled to demonstrate much progress.
As such, its hard to imagine the company will still be in business a decade from now unless its products find much more commercial traction in the market.
Source: Shutterstock
Consensus Cloud Solutions (NASDAQ:CCSI) provides digital cloud fax technology. This allows companies, particularly in the healthcare space, to secure their digital communications.
While faxes (digital or otherwise) are hardly the latest communications technology, there is still some demand here, at least for the time being. In certain fields, clients opt for the traditional secure and proven communications channel rather than a newer and more flexible but potentially more vulnerable option.
That said, Consensus Cloud is not firing on all cylinders right now. Revenues were up only marginally year-over-year, and other metrics such as total client figures were around flat as well. Its tough to gain much growth in what seems like a structurally declining industry. As the companys risk factors disclosure notes, there is risk of: Reduced use of fax services due to increased use of email, scanning or widespread adoption of digital signatures or otherwise.
Over the next decade, that seems likely to be the case, in fact. CCSI stock seems cheap on an earnings basis. But the company has debt, and a negative book value per share figure. Its far from certain this business will still be around in 2034, at least as an independent public entity.
On the date of publication, Ian Bezek did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Ian Bezek has written more than 1,000 articles for InvestorPlace.com and Seeking Alpha. He also worked as a Junior Analyst for Kerrisdale Capital, a $300 million New York City-based hedge fund. You can reach him on Twitter at @irbezek.
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Gray Skies Ahead? 3 Cloud Stocks That Will Be Gone in 10 Years - InvestorPlace
Deciphering Cloud Signals: 2024 Cloud Trends Report – InformationWeek
In 2024, not all cloud computing professionals see the cloud shaping up in the same way, but all want more than rising costs.
Most respondents, from IT leaders to cybersecurity experts, are running a hybrid cloud environment but there is a clear leader in providers. The majority, 61%, are using Azure, which just inched out AWS (60%) in a surprising reversal from last year's survey.
Otherwise, the cloud mix in hybrid arrangements was a bit of potluck. Respondents were allowed to make multiple choices, and they chose a wide variety of public cloud vendors, including quite a long list of write-ins, revealing a complicated cloud ecosystem.
However, there is little to no consensus in cloud usage strategies despite general unity in priorities. For example, there were just as many people saying they use over 100 cloud services as there were using only one.
Download this free report to learn about the cloud trends impacting your business!
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Deciphering Cloud Signals: 2024 Cloud Trends Report - InformationWeek
Amazon pours $150B into data centers to handle expected AI boom – New York Post
Amazon is reportedly planning to spend a whopping $150 billion within the next 15 years on building data centers a move that will position the tech giant to be able to handle an expected explosion with artificial intelligence applications and other digital services.
The spending spree, earlier reported on by Bloomberg, will also allow Amazon to maintain its top spot in the cloud services market, where it holds roughly twice the share of No. 2 player Microsoft.
Were expanding capacity quite significantly, said Kevin Miller, a vice president at AWS, or Amazon Web Services, Amazons cloud computing subsidiary used by upwards of 1.45 million businesses, according to an internal report.
I think that just gives us the ability to get closer to customers, Miller added of the Seattle-based firms investment in more data centers, according to Bloomberg.
Amazon has already committed to spending $148 billion over the past two years to build and operate data centers globally in new regions like Mississippi, Saudi Arabia, Malaysia and Thailand.
It will also use that hoard of funds to expand existing server farm hubs adjacent to a Washington metro in Virginia as well as in rural Oregon, which offers cheap hydroelectric power and appealing tax breaks, Bloomberg reported.
As it stands, Virginia and Oregon receive roughly $4 of every $5 AWS spends on US infrastructure.
But earlier this month, the Jeff Bezos-founded firm bought a site in northeast Pennsylvania in the shadow of a nuclear power plant that the forthcoming data center will use as a source of carbon-free energy for the digital hub to help the tech giant meet its emission goals, according to commercial property company CoStar.
Amazon bought the 1,200-acre property for $650 million, making it the largest individual US commercial sale so far this year, CoStar reported.
When AWS is done with construction, the data centers campus will have the capacity to power the equivalent of the energy consumption of nearly 900,000 houses, or as much as 960 megawatts.
It also revealed a roughly $10 billion spend to acquire two data center campuses in Mississippi last month, considered the largest corporate project in state history, according to Bloomberg.
Theres also rumblings of yet another AWS data center in Round Rock, Texas, as the company won zoning approval to build a data center and electrical substationnext to a former ranch it already owns, which it bought as part of a similar spending spree during the pandemic.
Still, Amazons anticipated spending on data centers dominates commitments from Microsoft which is entrenched in multiyear partnership with ChatGPT-maker OpenAI and Alphabets Google, according to Bloomberg, though neither company has disclosed server farm-related spending and spokespeople at each firm declined weighing in on the topic.
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In 2023, Microsoft boosted its spending on data centers by more than 50% while for the first time ever AWSs capital expenditures on data centers shrank 2%.
Most of the ramped-up data center-related expenses is intended to meet a rising demand among corporation for large-scale file storage and databases, per Bloomberg.
However, the hubs will have such massive computing power that, along with chips, will be able to lend some of it to whats required of AI-backed services.
To rival OpenAI, Amazon has been building out its own tools with the booming tech, including with a $4 billion in rival Anthropic, which was completed on Wednesday.
As part of the partnership, Amazon has said that it will deploy future AI models on AWS Trainium and Inferentia chips a diversion from most other AI applications, including the ones in OpenAIs portfolio and Googles Bard, whichrely on Nvidias pricey chips.
Anthropics co-founders, brother-sister duo Dario and Daniela Amodei, are likely very familiar with those chips as they both previously held VP-level positions for ChatGPT maker OpenAI.
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Amazon pours $150B into data centers to handle expected AI boom - New York Post
Spending on Shared Cloud Infrastructure Continues to Lead the Way in Enterprise Infrastructure Investments … – IDC
NEEDHAM, Mass., March 28, 2024 According to the International Data Corporation (IDC) Worldwide Quarterly Enterprise Infrastructure Tracker: Buyer and Cloud Deployment, spending on compute and storage infrastructure products for cloud deployments, including dedicated and shared IT environments, increased 18.5% year over year in the fourth quarter of 2023 (4Q23) to $31.8 billion. Spending on cloud infrastructure continues to outgrow the non-cloud segment with the latter growing 16.4% year over year in 4Q23 to $18.9 billion. The cloud infrastructure segment saw unit shipments decline 22.8% in the quarter with an increase in average selling prices (ASPs) mostly related to higher than usual GPU server shipments to hyperscalers.
"Cloud infrastructure spending continues to accelerate towards more robust configurations mainly fueled by the explosion of AI-related investments," said Juan Pablo Seminara, research director, Worldwide Enterprise Infrastructure Trackers at IDC. "Even though some caution remains on the socio-political side, the improvement in economic prospects contribute to a very positive spending outlook for 2024 and 2025 where cloud-based spending is expected to rebound at double-digit growth rates."
Spending on shared cloud infrastructure reached $22.8 billion in the quarter, increasing 27.0% compared to a year ago. The shared cloud infrastructure category continues to capture the largest share of spending compared to dedicated deployments and non-cloud spending. In 4Q23, shared cloud accounted for 44.9% of total infrastructure spending. The dedicated cloud infrastructure segment saw modest growth of 1.4% year over year in 4Q23 to $9.0 billion.
For 2024, IDC is forecasting cloud infrastructure spending to grow 19.3% compared to 2023 to $129.9 billion. Non-cloud infrastructure is expected to decline 1.4% to $57.6 billion. Shared cloud infrastructure is expected to grow 21.6% year over year to $95.3 billion for the full year while spending on dedicated cloud infrastructure is expected to have robust growth of 13.3% in 2024 to $34.6 billion for the full year. The subdued growth forecast for non-cloud infrastructure, which is forecast to decline 1.4% year over year in 2024, reflects the expectation that the market still faces some challenges. Cloud spending will remain very positive due to new and existing mission-critical workloads, which often require higher-end, performance-oriented systems.
IDC's service provider category includes cloud service providers, digital service providers, communications service providers, hyperscalers, and managed service providers. In 4Q23, service providers as a group spent $30.0 billion on compute and storage infrastructure, up 19.6% from the prior year. This spending accounted for 59.2% of the total market. Non-service providers (e.g., enterprises, government, etc.) also increased their spending to $20.7 billion, growing 15.2% year over year. IDC expects compute and storage spending by service providers to reach $124.3 billion in 2024, growing 21.8% year over year.
On a geographic basis, year-over-year spending on cloud infrastructure in 4Q23 showed mixed results, with China, the Middle East, and Canada showing negative growth led by China with a decline of 31.1%, mainly affected by an economy still under pressure in the fourth quarter of 2023. The Middle East & Africa saw spending decline 12.2% due to difficult year-over-year comparison that resulted from large projects at the end of the prior year. Spending in Canada declined 4.4% year over year. The regions with increased spending in 4Q23 were Asia/Pacific (excluding Japan and China), the United States, Central & Eastern Europe, Japan, Western Europe, and Latin America, where cloud spending grew at 48.2%, 40,6%, 11.3%, 10.5%, 2.7%, and 1.5% year over year, respectively. Most of this growth was related to large high-performance computing and AI-based projects.
Long term, IDC predicts spending on cloud infrastructure to have a compound annual growth rate (CAGR) of 12.8% over the 2023-2028 forecast period, reaching $199.1 billion in 2028 and accounting for 73.6% of total compute and storage infrastructure spend. Shared cloud infrastructure spending will account for 71.8% of the total cloud spending in 2028, growing at a 12.8% CAGR and reaching $143.0 billion. Spending on dedicated cloud infrastructure will grow at a CAGR of 12.9% to $56.1 billion. Spending on non-cloud infrastructure will also rebound with a 4.1% CAGR, reaching $71.4 billion in 2028. Spending by service providers on compute and storage infrastructure is expected to grow at a 13.1% CAGR, reaching $188.5 billion in 2028.
IDC's Worldwide Quarterly Enterprise Infrastructure Tracker: Buyer and Cloud Deployment is designed to provide clients with a better understanding of what portion of the compute and storage hardware markets are being deployed in cloud environments. The Tracker breaks out each vendors' revenue into shared and dedicated cloud environments for historical data and provides a five-year forecast. This Tracker is part of the Worldwide Quarterly Enterprise Infrastructure Tracker, which provides a holistic total addressable market view of the four key enabling infrastructure technologies for the datacenter (servers, external enterprise storage systems, and purpose-built appliances: HCI and PBBA).
Taxonomy Notes
IDC defines cloud services more formally through a checklist of key attributes that an offering must manifest to end users of the service.
Shared cloud services are shared among unrelated enterprises and consumers; open to a largely unrestricted universe of potential users; and designed for a market, not a single enterprise. The shared cloud market includes a variety of services designed to extend or, in some cases, replace IT infrastructure deployed in corporate datacenters; these services in total are called public cloud services. The shared cloud market also includes digital services such as media/content distribution, sharing and search, social media, and e-commerce.
Dedicated cloud services are shared within a single enterprise or an extended enterprise with restrictions on access and level of resource dedication and defined/controlled by the enterprise (and beyond the control available in public cloud offerings); can be onsite or offsite; and can be managed by a third-party or in-house staff. In dedicated cloud that is managed by in-house staff, "vendors (cloud service providers)" are equivalent to the IT departments/shared service departments within enterprises/groups. In this utilization model, where standardized services are jointly used within the enterprise/group, business departments, offices, and employees are the "service users."
For more information about IDC's Quarterly Enterprise Infrastructure Tracker: Buyer & Cloud Deployment, please contact Lidice Fernandez at lfernandez@idc.com.
About IDC Trackers
IDC Tracker products provide accurate and timely market size, vendor share, and forecasts for hundreds of technology markets from more than 100 countries around the globe. Using proprietary tools and research processes, IDC's Trackers are updated on a semiannual, quarterly, and monthly basis. Tracker results are delivered to clients in user-friendly Excel deliverables and on-line query tools.
Click here to learn about IDCs full suite of data products and how you can leverage them to grow your business.
About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,300 analysts worldwide, IDC offers global, regional, and local expertise on technology, IT benchmarking and sourcing, and industry opportunities and trends in over 110 countries. IDC's analysis and insight helps IT professionals, business executives, and the investment community to make fact-based technology decisions and to achieve their key business objectives. Founded in 1964, IDC is a wholly owned subsidiary of International Data Group (IDG), the world's leading tech media, data, and marketing services company. To learn more about IDC, please visit http://www.idc.com. Follow IDC on Twitter at @IDC and LinkedIn. Subscribe to the IDC Blog for industry news and insights.
All product and company names may be trademarks or registered trademarks of their respective holders.
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Spending on Shared Cloud Infrastructure Continues to Lead the Way in Enterprise Infrastructure Investments ... - IDC
Amazon to ‘invest $150bn in data centers’ for AI growth – ReadWrite
Amazon is reportedly gearing up to invest nearly $150 billion over the next 15 years in data centers. This substantial financial commitment will equip the cloud-computing giant with the necessary resources to manage a projected rise in demand for AI applications and various digital services.
Bloomberg reports that this investment is a strategic display of dominance, to preserve Amazons leading position in the cloud services sector. Amazon currently holds about twice the market share of its closest competitor, Microsoft Corp.
An Amazon spokesperson confirmed to ReadWrite that the figures were based on its recent infrastructure announcements found on its website.
However, Amazon Web Services experienced its slowest sales growth on record last year, as corporate clients reduced expenses and postponed upgrades. Now, as spending begins to rebound, Amazon is eagerly securing land and energy for its energy-intensive operations.
In the last two years, Bloomberg said its calculations indicate that Amazon has pledged $148 billion towards the building and operation of data centers globally. The company aims to expand its server farm locations in northern Virginia and Oregon, and venture into new areas such as Mississippi, Saudi Arabia, and Malaysia.
Despite the expansion, AWS saw a 2% decrease in its data center investments in 2023, marking its first reduction, even as Microsoft ramped up its expenditures by over 50%, as reported by DellOro Group. However, Amazons Chief Financial Officer announced last month that there would be an uptick in capital investments this year to fuel AWSs expansion, encompassing projects related to artificial intelligence.
As we look forward to 2024, we anticipate capex to increase year over year, primarily driven by increased infrastructure capex to support growth of our AWS business, including additional investments in generative AI and large language models, said CFO Brian Olsavsky.
While Amazons expansion of its data centers aims to cater to the growing need for corporate services, its focus on sophisticated, high-cost chips will provide the substantial computing power needed for the predicted increase in generative AI.
Reports suggest that Amazon is developing proprietary tools to compete with OpenAIs ChatGPT, and has developed partnerships with various companies to enhance its AI services using its servers. As a result, Amazon expects to generate AI-related revenue amounting to tens of billions of dollars.
Featured image: Canva / Web Summit Rio
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Amazon to 'invest $150bn in data centers' for AI growth - ReadWrite