{"id":1836245,"date":"2023-02-06T06:21:09","date_gmt":"2023-02-06T11:21:09","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1836245"},"modified":"2023-02-06T06:22:27","modified_gmt":"2023-02-06T11:22:27","slug":"big-tech-earnings-face-more-heat-as-cloud-cover-fades","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/big-tech-earnings-face-more-heat-as-cloud-cover-fades\/","title":{"rendered":"Big Tech Earnings Face More Heat as Cloud Cover Fades"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fbig-tech-earnings-face-more-heat-as-cloud-cover-fades%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1836245&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47-->\n<p>Big Tech results reinforced concerns a boom in cloud services is easing, limiting a lucrative source of profit when a slowing economy has hit the companies\u2019 other businesses and prompting a bet on artificial intelligence as the next growth driver.<\/p>\n<p>Earnings from Amazon.com Inc and Microsoft Corp.\u2014which together dominate the cloud market\u2014showed growth in the business was at its lowest since they started breaking out the metric in 2015 and was on track to slow further.<\/p>\n<p>Alphabet Inc. has the smallest cloud business of the three and reported that Google Cloud grew by 32 percent. This is the slowest growth since 2019 when the company started reporting this measure.<\/p>\n<p>These poor results reflect a shift in post-pandemic frugality among corporate customers, whose budgets have been squeezed over the past 12 months by rising interest rate and high inflation.<\/p>\n<p>\u201cOnce thought as the most defensive revenue stream in <a href=\"https:\/\/www.theepochtimes.com\/t-tech-2\">tech<\/a>, we are seeing investors questioning the cyclicality for the (cloud) business,\u201d Bernstein analysts stated.<\/p>\n<p>Cloud services were a reliable source for information for many years. <a href=\"https:\/\/www.theepochtimes.com\/t-earnings\">Earnings<\/a> Amazon and Microsoft.<\/p>\n<figure id=\"attachment_4748650\" class=\"wp-caption alignnone\"><a href=\"https:\/\/img.theepochtimes.com\/assets\/uploads\/2022\/09\/22\/AWS-logo-1200x742.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\"lazy size-medium wp-image-4748650\" src=\"https:\/\/www.theepochtimes.com\/assets\/themes\/eet\/images\/white.png\" data-src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2023\/02\/AWS-logo-600x371-1.jpg\" alt=\"AWS logo\" width=\"600\" height=\"371\"   style=\"display:none\"><figcaption class=\"wp-caption-text\"><noscript><img loading=\"lazy\" decoding=\"async\" class=\"size-medium wp-image-4748650\" src=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-content\/uploads\/2023\/02\/AWS-logo-600x371-1.jpg\" alt=\"AWS logo\" width=\"600\" height=\"371\" \/><\/noscript><\/figcaption><\/a> 3D printed figurines and clouds in front of AWS (Amazon Web Service), cloud service logo in an illustration taken February 8, 2022. (Dado Ruvic\/Illustration\/Reuters)<\/figure>\n<p>In each quarter of calendar 2020 when the pandemic hit, Microsoft saw growth of about 50 percent in Azure cloud computing business. During the same period, Amazon Web Services (AWS), market leader in cloud computing, reported a sales increase of around 30%.<\/p>\n<p>However, times have changed.<\/p>\n<p>Growth at AWS slowed to a record low of 20 percent in the last three months of 2022 to $21.4 billion, slightly missing analysts\u2019 estimates of $22.03 billion, according to Refinitiv data.<\/p>\n<p>Microsoft\u2019s revenue in its so-called intelligent cloud business that includes Azure rose 18 percent to beat expectations for October to December. However, its current quarter forecast of $21.7 billion-$22 billion was lower than the estimates of $22.14 trillion.<\/p>\n<p>\u201cThe deceleration in AWS was even worse than expected and means Amazon can\u2019t rely on that business units\u2019 operating profits as much in coming quarters,\u201d said Andrew Lipsman, principal analyst at Insider Intelligence.<\/p>\n<p>Brian Olsavsky (Amazon finance chief) stated that Amazon expects slower cloud growth rates in the coming quarters. That echoed Microsoft, which said last week that growth in its Azure cloud-computing business would slow by 4\u20135 basis points in the March quarter.<\/p>\n<p>\u201cYou\u2019ve just come off two years of rapid movement of workloads to the cloud, there\u2019s probably a lot of inefficiency in cloud spending and now there is a shifting focus to greater efficiency,\u201d James Cordwell is an analyst at Atlantic Equities.<\/p>\n<h2>AI Silver Lining<\/h2>\n<p>A potential boom in AI after the viral success of OpenAI\u2019s ChatGPT could boost demand for cloud services again though, analysts said. Companies that provide services to support AI technology will benefit from the huge computing power required by AI applications.<\/p>\n<p>Microsoft, as an investor and partner in OpenAI, appears well-positioned, analysts stated. However, any gains could take time to convert into profits.<\/p>\n<p>\u201cThose (AI) advancements and demand for related cloud services will take time to materialize. They\u2019re not likely to offset current headwinds in the enterprise market over the next few quarters,\u201d Lipsman stated.<\/p>\n<p><em>Yuvraj Malik, Aditya Soni<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Big Tech results reinforced concerns a boom in cloud services is easing, limiting a lucrative source of profit when a slowing economy has hit the companies\u2019 other businesses and prompting a bet on artificial intelligence as the next growth driver. Earnings from Amazon.com Inc and Microsoft Corp.\u2014which together dominate the cloud market\u2014showed growth in the &hellip;<\/p>\n","protected":false},"author":1,"featured_media":1836248,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[547],"tags":[10465,7756,11333,17731,4060,4989],"class_list":["post-1836245","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-bongino-report","tag-cloud","tag-cover","tag-earnings","tag-fades","tag-heat","tag-tech"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1836245","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1836245"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1836245\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/1836248"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1836245"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1836245"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1836245"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}