Could Amazon’s Cloud Computing Crown Be Slipping?

Could Amazon’s Cloud Computing Crown Be Slipping?
Andrew Rummer

over 2 years ago1 min

Mentioned in story

Amazon Web Services (AWS), Amazon’s cloud computing business, has become the online retailer’s most profitable division since its launch in 2006. But a new report shows its breakneck growth might finally be topping out. 

AWS has driven a huge chunk of the company’s 16x share price gain over the past decade, and it’s not hard to see why: providing data centers is much more profitable than selling pet food or books, after all. AWS accounts for only about 12% of Amazon’s revenue, but it brings in nearly half of its operating profit. 

But a report this week from market research firm Gartner highlights that Amazon’s fiercest cloud computing rivals – Microsoft, Google, and Alibaba – all grew much faster last year, trimming AWS’s share of the $64 billion global market to less than 41% from more than 44% in 2019. 

As Andy Jassy takes over from Jeff Bezos as Amazon’s CEO next week, figuring out how not to lose even more of this lucrative market is sure to be near the top of his to-do list. Luckily, Jassy knows AWS inside out – because he currently runs it.

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