Last week, all three of the three major providers of cloud services gave quarterly updates. One major pattern stood out: (GOOG -0.47%) and (GOOGL -0.13%) of Alphabet Both Microsoft’s (MSFT -0.55%) and Google Cloud AWS from Amazon (AMZN -3.22%) is losing ground against Azure.
In the quarter that ended on March 31, 2023, Alphabet reported a 28% year-over-year increase in Google Cloud revenue. Microsoft reported a 27% increase in income from Azure and other cloud services. AWS’s net sales increased, although by less than 16%.
Amazon doesn’t seem to be worried about the threats from Google and Microsoft, but some investors appear to be. Amazon’s shares fell last week, while Microsoft stock soared and Alphabet stock edged a little higher.
Is there truly nothing to worry about? I don’t think there is any real reason for concern. Sure, Google and Microsoft are catching up somewhat thanks in large part to their AI initiatives. However, the bottom line is that Amazon, in Jassy’s words, “isn’t close to being done inventing in AWS.” My view has been and continues to be that Amazon, Alphabet, and Microsoft will be tremendously successful AI stocks over the long run.
