I generally base my unofficial estimates on the volume of blog posts, google hits, etc... for specific offerings that have direct equivalents in the two clouds.
I still see a significantly smaller volume of hits turning up for Azure, which makes me suspect that they have a higher revenue per resource.
E.g.: I suspect Azure targets "large enterprise", which is notoriously wasteful, whereas AWS targets frugal startups that use Linux and OSS.
Neither of them are straight forward with what cloud revenue actually means. If I recall correctly, Microsoft includes SQL Server in cloud revenue. The only people on the planet that can tell you Azure's actual revenue work at Microsoft and the only people on the planet that can tell you GCP's actual revenue work at Google.
From the presentation: "Microsoft Cloud includes Azure and other cloud services, Office 365 Commercial, the commercial portion of LinkedIn, Dynamics 365, and other cloud properties."
> “This quarter Microsoft Cloud revenue was $25.7 billion, up 24% (up 31% in constant currency) year-over-year. We continue to see healthy demand across our commercial businesses including another quarter of solid bookings as we deliver compelling value for customers,” said Amy Hood, executive vice president and chief financial officer of Microsoft.
From the presentation:
"Microsoft Cloud includes Azure and other cloud services, Office 365 Commercial, the commercial portion of LinkedIn, Dynamics 365, and other cloud properties."
No need to be hostile (and right and wrong simultaneously).
I get your point, but puns are the least of our collective concerns when it comes to signal to noise ratio. Such subthreads are fairly rare considering people trying to jam in (say) partisan politics.
You only get a good discount on Microsoft Dynamics if you also get some cloud credits ... oh and while getting it: do you want the LinkedIn integration to Dynamics? LinkedIn is accounted for under cloud, too.
They can shift the revenue accountingwise wherever they want it. (Just have to make sure they internally track it better, to see which products actually bring the money ...)
Yes I think this is correct. For years, MS has made apples-to-apples comparisons with AWS challenging by bundling in cloud app revenue into the overall Azure cloud business. Makes sense bc Office365 SaaS was so much larger than IAAS and PAAS.
As others have said microsoft leverages their considerable relationships and other products to pump their cloud numbers. My friend who worked for an electric generator told me that microsoft offered to switch the electricity source of their data centers to their company if they switched their cloud to azure. That's on top of the O365 deal and of course massive credits.
Notice how the stock cratered after hours? Growth is slowing on cloud revenue. It's lower than expectations. Cloud is a big reason for the expanded PE ratio on both Amazon and Microsoft. Amazon reports in 2 days, already it's taking a hit. A bit of the assumption is cloud spending would not be as impacted as the Microsoft one is showing. Tech companies in general will likely show red tomorrow, as the markets digest this news.
I’m sure they will be red but MSFT has PE of ~25 which is pretty boring for a “growth” tech stock. AMZN has a PE of >100 and is one of the few remaining outliers among big tech companies. The rest are much closer though not exactly equal to boring blue chip PE ratios.
But cloud is still growing while the stock drops. This tells me that the cloud investment thesis is incorrect, and investors actually care more about PC Windows and Xbox. This makes more sense because cloud compute is destined to become a low-margin commodity, while Windows and Xbox are protected brands.
38 comments
[ 5.6 ms ] story [ 100 ms ] threadCompared to Google, if I read their Financials correctly, their Cloud revenue was just $6.8 billion for the quarter. https://abc.xyz/investor/static/pdf/2022Q3_alphabet_earnings...
Amazon is probably dominating both of them combined...
Looks like Azure + Microsoft 365 has overtaken AWS.
The question is whether Azure alone has overtaken AWS…
So it hasn't.
I generally base my unofficial estimates on the volume of blog posts, google hits, etc... for specific offerings that have direct equivalents in the two clouds.
I still see a significantly smaller volume of hits turning up for Azure, which makes me suspect that they have a higher revenue per resource.
E.g.: I suspect Azure targets "large enterprise", which is notoriously wasteful, whereas AWS targets frugal startups that use Linux and OSS.
Not a very interesting question as the answer is, as it’s been for many years, “no.”
If Azure ever overtakes AWS that will be very noteworthy. But it’s pretty hard to compare revenue to revenue because of the way the companies report.
[1] http://view.officeapps.live.com/op/view.aspx?src=https://c.s...
Literally all those numbers are incorrect. This is what the actual press release says:
> Revenue in Intelligent Cloud was $20.3 billion
Not $25.7B.
> increased 20%
Not 24%.
> (up 26% in constant currency)
Not 31%.
> “This quarter Microsoft Cloud revenue was $25.7 billion, up 24% (up 31% in constant currency) year-over-year. We continue to see healthy demand across our commercial businesses including another quarter of solid bookings as we deliver compelling value for customers,” said Amy Hood, executive vice president and chief financial officer of Microsoft.
From the presentation: "Microsoft Cloud includes Azure and other cloud services, Office 365 Commercial, the commercial portion of LinkedIn, Dynamics 365, and other cloud properties."
No need to be hostile (and right and wrong simultaneously).
They can shift the revenue accountingwise wherever they want it. (Just have to make sure they internally track it better, to see which products actually bring the money ...)