uploads///IBM cloud related revenue growth

IBM’s Cloud Growth Lags behind Amazon’s and Microsoft’s

By

Dec. 3 2018, Updated 7:32 a.m. ET

IBM’s knight in shining armor

In this series, we’ve discussed how IBM’s (IBM) revenue declined in the last quarter after showing promise in prior quarters. One business driving growth for IBM is the cloud. The company’s Strategic Imperatives segment comprises its fast-growing cloud, AI, and data analytics businesses.

As the chart below shows, Strategic Imperatives revenue grew 11% YoY (year-over-year) in the last quarter, with cloud revenue growing by 13%. The company’s “as-a-service” revenue, which includes its infrastructure-as-a-service platform, grew by an impressive 24%. Therefore, the cloud is clearly a growth driver for IBM, despite the company’s overall revenue falling 2% in the last quarter.

Article continues below advertisement

IBM lags behind cloud service competitors

Although IBM’s 13% cloud revenue growth looks good compared with its 2% overall revenue decline in the last quarter, this growth is small in comparison to what IBM’s competitors are experiencing. Amazon’s (AMZN) AWS (Amazon Web Services) and Microsoft’s (MSFT) Azure, the top two players in the cloud service market, saw revenue growth of 46% and 75%, respectively, in the last quarter.

According to Synergy Research, AWS held a healthy 33% of the cloud service market, and Microsoft was a distant second with a 12% share. IBM (IBM), Google (GOOG), and Alibaba (BABA) all had a single-digit percentage share of the market. Synergy reported that while Amazon kept its market share constant, Microsoft and Alibaba grew their market share.

Advertisement

More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.