Amazon, Google and Microsoft’s dominance in the cloud market is no secret, but the tech titans continued to gain ground on rivals in Q3, new data from Synergy Research Group shows. Amazon alone accounts for more than a third of spending on cloud infrastructure services.
According to the analyst firm, Amazon’s market share rose one percentage point year on year to 34%. Microsoft and Google each also gained one percentage point over the same period, increasing their shares to 21% and 11%, respectively.
On Thursday, Amazon reported consolidated revenue of $127.1 billion, which rose 15% year on year and profit which fell slightly to $2.9 billion. Amazon Web Services contributed $20.5 billion in revenue, with that figure increasing 28% year on year, and representing an annual run rate of $82 billion.
Addressing concerns about whether the uncertain economic climate is impacting AWS, Amazon CFO Brian Olsavsky acknowledged “We do see some of the consumers are cutting their budgets and trying to save money in the short run.” However, he said the company remains “really excited about the business, both in the long term and even in the short run.”
“You noticed we've added $4.5 billion to the $16 billion base we had of revenue last Q3, so the business is growing in absolute dollars at a really good clip,” he continued. Amazon expects a mid-20% growth rate for AWS in Q4, the CFO added.
In terms of the other cloud frontrunners, Microsoft reported $25 billion in revenue for its Cloud business and Google Cloud brought in $6.9 billion.
Synergy noted other cloud players haven’t done too poorly for themselves either, tripling their revenue since late 2017. However, these companies have seen their collective market share plunge from 50% to 35%.
John Dinsdale, a Chief Analyst at Synergy Research Group, said in a statement that beyond the big three “all other cloud providers in aggregate have been losing around three percentage points of market share per year but are still seeing strong double-digit revenue growth.” He concluded “The key for these companies is to focus on specific portions of the market where they can outperform the big three.”