AWS tops $50B run rate as cloud players book killer Q1 results

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AWS had a backlog of contracts worth some $52.9 billion as of March 31. (Pixabay)

Amazon joined fellow cloud players Microsoft and Google in booking monster Q1 results, helping propel the company’s Amazon Web Services (AWS) business to a more than $50 billion run rate.

For the first three months of the year, AWS revenue increased 32% year on year from $10.2 billion to $13.5 billion, with operating income of nearly $4.2 billion up from nearly $3.1 billion.

During an earnings call, Amazon CFO Brian Olsavsky revealed the AWS unit was on track to hit “a $54 billion annualized run rate” for revenue in 2021, up from $31 billion in 2019 and $41 billion in 2020. He noted the growth couldn’t be attributed to any particular customer group, stating it was seeing “strength across the board.”

Dave Fildes, Amazon’s director of investor relations, added AWS had a backlog of contracts worth some $52.9 billion as of March 31, with a weighted average life of a little over three years.

"You can expect to continue to see customers making these long-term commitments," he said.

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Consolidated revenue increased 44% to $108.5 billion in the first quarter, compared with $75.5 billion in the year-ago quarter. Net income of $8.1 billion was up substantially year on year from $2.5 billion.

Q1 cloud recap

Amazon’s cloud revenue came in just behind the $15.1 billion recorded by Microsoft’s Intelligent Cloud unit in Q1, a figure which was up 23% year on year. Microsoft’s overall commercial cloud revenue increased 33% to hit $17.7 billion in the quarter, while the company’s consolidated revenue grew 19% to $41.7 billion.

Meanwhile, Google’s cloud revenue also continued to grow apace, jumping 45% year on year to $4 billion. However, the unit remained in the red, though narrowed its loss to $974 million from $1.7 billion in Q1 2020.

Consolidated revenue for Google parent company Alphabet rose 32% to $55.3 billion, with net income increasing from $6.8 billion to $17.9 billion.