Microsoft and Google have revealed their revenue from Cloud business during the July-September quarter of 2021.
Contracts for cloud services provided by Microsoft, Amazon.com’s AWS and Alphabet-owned Google Cloud have surged since last year when the COVID-19 pandemic shut offices and schools, pushing more activity online.
Microsoft has outperformed Google Cloud in terms of revenue growth during the recent quarter thanks to its hybrid Cloud strategy. But AWS is the Cloud market leader in terms of revenue.
First-quarter revenue growth for Azure, Microsoft’s cloud-computing business, was 48 percent. The company also expected broad based growth for the unit in the fiscal second quarter, said Amy Hood, executive vice president and chief financial officer of Microsoft.
Azure’s growth rate is the best direct measure of competition with rivals such as AWS and Google Cloud as Microsoft does not break out revenue from the cloud-computing unit.
Satya Nadella, chairman and chief executive officer of Microsoft, said: “The Microsoft Cloud delivers the end-to-end platforms and tools organizations need to navigate this time of transition and change.”
Google said on Tuesday Google Cloud revenue surged by 45 percent to $4.99 billion. Google Cloud generates revenues primarily from fees received for Google Cloud Platform services and Google Workspace collaboration tools.
Microsoft has increased its cloud computing margins despite higher data center construction costs because it keeps adding more profitable services to those data centers.
Microsoft’s revenue from selling Windows to PC makers grew 10 percent year over year, beating the overall PC market, which only grew 3.9 percent over the same period because of supply constraints, according to data from IDC.
Hood said that the company was able to outperform in the PC market because of its strength in selling licenses for Windows destined for corporate customers, where it gets more revenue per license and has better market share.
Microsoft’s total revenue rose 22 percent to $45.32 billion in the first quarter ended Sept. 30. Net income rose to $20.51 billion.