Amazon continued to tread along a growth trajectory with its fourth quarterly results announced today. AWS, the cloud subsidiary of the e-commerce behemoth also reported its earnings, which reflected a modest 47 percent increase in revenues. The operating income generated using these cloud services amount to a massive $936 million for the quarter ended December 2016.
Though Amazon’s cloud business continues to dominate the market but growth has slowed down when compared to the previous quarter. It had reported 55 percent increase in revenues in the previous quarter, this number is now down to 47. And what’s surprising, it is the slowest revenue growth for AWS in nearly two years. The operating expenditures for the said quarter, however, stood at $2.43 billion.
One is definitely aware of the fact that AWS is one of the most widely accepted public cloud infrastructure providers for user workloads. It is also the most preferred cloud service, which is currently facing tough competition from the likes of Microsoft, Google, and Oracle. Some of these tech giants have even reported growth figures (Microsoft Azure revenue grew 93%) much larger than the e-commerce giant. This can be attributed to the already existing user base of the cloud service.
AWS has continued to accelerate its cloud service with the addition of 308 significant new services and features. This included three new AI (artificial intelligence) services “that make it easy for any developer to build apps that can understand natural language, turn text into lifelike speech.” It also saw customers migrate more than 18,000 databases using the AWS Database Migration Service in 2016. Talking about the growth of AWS’ services, the official statement reads,
AWS accelerated its infrastructure expansion in 2016, opening eleven Availability Zones across five geographic regions in the U.S., Korea, India, and most recently, Canada and the U.K.
AWS now operates 42 Availability Zones across 16 infrastructure regions globally and plans to open an additional five Availability Zones in two regions (France and a second region in China) in the coming months.
Amazon Web Services has been the very first cloud service provider to capture a majority market share, but its rivals are now gaining mass momentum. Forrester predicts that the public cloud market will grow to $236 billion by 2020, and this is one of the more optimistic looks at the overall market size.