Microsoft’s Azure grew 73% YoY
Microsoft’s (MSFT) cloud businesses are slowly becoming the key growth engine for the software giant. The company’s Intelligent Cloud segment, which includes Azure and other cloud-based businesses, surged 22% YoY to $9.7 billion during the third quarter of 2019 (quarter ended March 2019). Microsoft’s cloud infrastructure business, Azure, is the most integral part of the company’s cloud business. Microsoft’s Azure business grew 73% YoY during the third quarter, the company said. Microsoft does not disclose the revenue from Azure.
As the graph below shows, the company’s growth in Azure has been decelerating over the past several quarters. However, the deceleration is not alarming. In the second quarter, Azure grew 76% YoY. A 73% YoY increase also suggests that there is still a lot of room for Azure to grow.
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Azure continues to grow faster than AWS
According to Canalys’s estimates, Microsoft made $13.5 billion in revenue through Azure in calendar year 2018, an 82.4% increase from the previous year.
Microsoft had a 16.8% market share in the cloud infrastructure market last year, second only to Amazon’s (AMZN) AWS, which cornered a 31.7% market share. However, Azure is growing at a much faster clip. AWS has been consistently growing at ~45% YoY each quarter.
The strength in the company’s cloud business had propelled it to the position of the most valuable company by market cap for the majority of the year. Currently, it has a market cap of $959 billion, only second to Apple, which has a market cap of $976.8 billion.