Amazon cloud revenue rises 12%, topping analysts’ estimates

Amazon mentioned Thursday that income from its cloud unit elevated 12% 12 months over 12 months within the second quarter, a speedier tempo than analysts had predicted.

Revenue for the quarter got here to $22.1 billion, beating the $21.79 billon consensus amongst analysts surveyed by StreetAccount. Revenue grew virtually 16% within the first quarter.

Of Amazon’s $7.7 billion in working revenue, 70% of it got here from Amazon Web Services, which led the cloud infrastructure market with 40% share in 2022, expertise business researcher Gartner mentioned final month.

AWS generated $5.4 billion in working earnings, which is down 5% 12 months over 12 months however increased than the StreetAccount consensus of $5.24 billion. AWS working earnings has now declined for 3 consecutive quarters.

Economic issues have pushed company leaders to scrutinize their corporations’ use of cloud infrastructure resembling Amazon’s AWS and search for locations to save cash. Last week, Microsoft executives mentioned they anticipate clients will proceed optimizing their present workloads on Azure within the third quarter.

“While customers have continued to optimize during the second quarter, we’ve started seeing more customers shift their focus toward driving innovation and bringing new workloads to the cloud,” Andy Jassy, Amazon’s CEO and previously the pinnacle of AWS, mentioned on a convention name with analysts.

During the second quarter AWS launched Bedrock, a service that organizations can use to deploy generative synthetic intelligence fashions that may compose spectacular textual content and pictures in response to phrases or pictures that folks submit. AWS additionally mentioned it’s investing $100 million within the launch of a Generative AI Innovation Center to pair clients with specialists.

Google and Microsoft are additionally shifting shortly to generate profits as corporations look to reap the benefits of generative AI following the rise of startup OpenAI’s ChatGPT chatbot. Microsoft’s Azure OpenAI Service grew to become out there in January, months earlier than the Bedrock announcement.

AWS CEO Adam Selipsky instructed CNBC in June that the generative AI “race” has simply began.

Correction: A previous model of this story mistakenly mentioned a quantity represented income as an alternative of working earnings.

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