Amazon AMZN is making every effort to strengthen its presence in the global cloud market, thanks to its Amazon Web Services (AWS) portfolio strength, which has been driving its customer momentum.
The latest selection of AWS by PT Telekomunikasi Selular (Telkomsel) as the preferred cloud provider is a testament to the aforesaid fact. This highlights the efficiency and reliability of AWS’ innovative cloud products and services.
The Indonesian telecommunications provider plans to shift a wide range of IT applications to AWS, which include its front-end customer channels, Telkomsel’s Gaming Store Front, middleware and machine learning, in a bid to boost operational efficiencies, IT performance and stimulate the development of advanced services.
Notably, AWS, which has become an integral part of Amazon, dominates the cloud market on the back of its growing adoption and popularity.
Moreover, solid momentum across AWS has been contributing well to the company’s total revenues. This, in turn, is constantly instilling investors’ optimism in the stock.
In second-quarter 2023, AWS generated revenues of $22.1 billion (17% of total sales), which grew 12% year over year.
For 2023, Our model estimated AWS revenues to be $91.6 billion, indicating growth of 14.4% from 2022.
Amazon has gained 54.2% in the year-to-date period.
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The latest move by Telkomsel has added strength to AWS’ customer base.
Apart from it, AWS was recently selected by Abdul Latif Jameel as a cloud provider. The latter intends to build AWS-supported analytics, machine learning and generative AI programs to power its digital transformation by developing new applications across a wide range of industries, such as mobility, energy, health and financial services.
Further, FanDuel picked AWS as its strategic cloud provider. FanDuel will leverage AWS’ cloud computing infrastructure to expand across the United States and Canada efficiently.
BMW Group also picked AWS for cloud services. With the help of AWS’ compute, generative artificial intelligence, Internet of Things, machine learning and storage capabilities, BMW Group strives to power its automated driving platform.
It was chosen by Dr. Reddy’s Laboratories as a cloud provider. Dr. Reddy’s shifted its SAP platform to AWS to boost the development of advanced healthcare applications. It strives to reduce application development time by 30%.
Additionally, Occidental OXY favored AWS as its cloud provider to enhance operational efficiencies and eliminate upfront capital expenditures.
Occidental plans to transfer its core production applications and on-premises information technology infrastructure to AWS to accelerate its digital transformation and the development of systems for carbon removal plants.
Sumitomo decided to drive its digital transformation by migrating its SAP environments to AWS. It plans to upgrade its SAP environment to SAP S/4HANA on AWS.
We believe that AWS’s growing global clientele due to its portfolio strength as well as data centers and cloud regions, will continue to help the company gain a competitive edge against its peers, namely Microsoft MSFT and Alphabet’s GOOGL Google.
Amazon currently carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
Microsoft Azure has become the key growth driver for Microsoft. The company is currently riding on robust adoption of Azure cloud offerings. Azure's increasing number of global availability zones and regions, along with strength in its consumption-based business, is likely to continue driving Microsoft's cloud momentum in the near term.
Similarly, Google Cloud is contributing substantial growth to the total revenues of Alphabet. Expanding data centers, availability zones and cloud regions are expected to keep uplifting Alphabet's cloud position.
Nevertheless, AWS, with solid customer momentum, continues to maintain its dominant position in the cloud market.
Per the latest Canalys report, AWS accounted for 30% of global cloud spending in second-quarter 2023, maintaining its leading position in the booming cloud market.
Microsoft’s Azure, the second-largest cloud service provider, accounted for 26% of worldwide cloud spending.
Alphabet’s Google Cloud represented 9% of cloud spending, making it the third-largest cloud provider.
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