Google, Microsoft and Amazon Report Stronger-Than-Expected First-Quarter Cloud Growth

Google, Microsoft and Amazon reported better-than-expected first-quarter cloud growth on Wednesday, with Google achieving its fastest growth rate on record. 05 billion. Google started breaking out cloud results in 2020.

Alphabet shares jumped 10% on Thursday, marking April as the stock's best month for performance since 2004, the year Alphabet went public. 'Our enterprise AI solutions have become our primary growth driver for cloud for the first time,' Alphabet CEO Sundar Pichai said on the company's Wednesday webcast with analysts.

Revenue from products built with Google generative AI models grew 800%, Pichai said.

Google Cloud CEO Thomas Kurian spoke at the Google Cloud Next event in San Francisco on April 9, 2019. Google Cloud is the smallest of the three cloud providers, as Google chases Amazon Web Services and Microsoft Azure in the public cloud market. Neoclouds hold 5% share of the cloud market, according to Synergy Research.

Neocloud providers include companies like CoreWeave and Nebius, and they have obtained 5% of the cloud market, Synergy Research analyst John Dinsdale said. Cloud infrastructure spending reached $129 billion in the first quarter, according to Synergy Research. 'Wow, that was some quarter,' Synergy Research analyst John Dinsdale said in an email after the results were released.

Google, Microsoft and Amazon expect to spend close to $600 billion on capital expenditures this year. 6 billion in the first quarter, exceeding StreetAccount's consensus by nearly $1 billion. AWS customer spending on Bedrock service jumped 170% from the fourth quarter, Amazon CEO Andy Jassy said.

Bedrock service used more tokens in the first quarter than in its history dating to 2023, Jassy said. 'OpenAI has said they're already seeing unprecedented demand for this new product, and we're seeing heavy customer interest as well,' Amazon CEO Andy Jassy said. AWS announced on the previous day that OpenAI models will come to Bedrock.

AWS also announced a new Bedrock service to enable clients to build sophisticated agents integrated with existing infrastructure. 8%. Microsoft management sees second-quarter Azure growth of 39% or 40% at constant currency, above StreetAccount's consensus of 37%.

The number of customers that adopted Anthropic and OpenAI models through Microsoft's platform doubled from the prior quarter, Microsoft CEO Satya Nadella said. Google, Microsoft and Amazon surpassed analyst estimates in earnings reports late Wednesday. The market is becoming more competitive with neocloud providers holding a growing share.