Microsoft Vs. AWS Vs. Google: Cloud Q2 Earnings Face-Off

Here are the second-quarter 2023 earnings results from AWS, Google and Microsoft, comparing sales growth, revenue, operating income and new worldwide cloud market-share data.

The three largest cloud companies on the planet—Amazon Web Services, Google Cloud and Microsoft—have now all reported their quarterly financial earnings for the second quarter of 2023. The three tech giants generated a total of roughly $54 billion in cloud sales combined during the second quarter.

AWS reported its slowest sales growth rate in years, while Google Cloud generated its highest operating income in its history.

“Our AWS growth stabilized as customers started shifting from cost optimization to new workload deployment,” said Amazon CEO Andy Jassy during the company’s second-quarter 2023 earnings report Thursday.

[Related: Google Hires 5 Key Execs From AWS, Microsoft: Here’s Who]

Combined, AWS, Google and Microsoft own 65 percent of the worldwide cloud services market in second-quarter 2023, according to brand- new cloud market-share numbers from Synergy Research Group.

CRN provides a side-by-side comparison of each company’s: total revenue, operating income, sales growth rates, parent company results and new second-quarter cloud market-share standings.

AWS, Microsoft And Google’s Q2 2023 Cloud Market Share

Before jumping into Google, Microsoft and AWS’ earnings and market-share data, it is key to note that the entire cloud infrastructure services market increased by $10 billion in second-quarter 2023 year over year.

Worldwide spending on enterprise cloud infrastructure services reached nearly $65 billion in the second quarter, representing a growth rate of 18 percent, or $10 billion year over year. Although the current economic climate has affected growth in cloud spending, Synergy Research Group said the market continues to expand at a healthy rate despite short-term challenges.

“We remain focused on leading the new AI platform shift, helping customers use the Microsoft Cloud to get the most value out of their digital spend and driving operating leverage,” said Microsoft Chairman and CEO Satya Nadella during his company’s quarterly earnings report last week.

Google and Amazon unveiled their Q2 2023 earnings results, which ended June 20, 2023. In the same three-month span, it represented Microsoft’s fourth fiscal quarter 2023.

CRN breaks down the five biggest revenue, income, growth and new market-share numbers that every AWS, Microsoft and Google Cloud partner, customer and investor should know.

Q2 Total Revenue/Annual Run Rate

AWS: $22.1 billion/$88 billion

Google Cloud: $8.03 billion/$32 billion

Microsoft: $24 billion/$96 billion

AWS captured total revenue of $22.1 billion in second-quarter 2023. The cloud computing pioneer now has an annual run rate of more than $88 billion.

Google Cloud generated total revenue of $8.03 billion in second-quarter 2023, besting Wall Street’s sales projection of approximately $7.8 billion. The company now has an annual run rate of approximately $32 billion, the largest in Google Cloud’s history.

Microsoft does not provide to the public its Azure sales figures. Instead, Microsoft combines Azure, server product and other cloud services revenue all under its Microsoft’s Intelligent Cloud umbrella. The company’s Intelligent Cloud group generated $24 billion in revenue during its fourth fiscal quarter 2023. This means Microsoft’s Intelligent Cloud group has an annual run rate of $96 billion.

Sales Growth

Google Cloud: 28 percent

Microsoft: 15 percent

AWS: 12 percent

Google Cloud’s just over $8 billion in revenue generated in second-quarter 2023 represented a year-over-year growth rate of 28 percent. This was the highest sales growth rate increase out of the three cloud companies. In first-quarter 2023, Google Cloud reported a similar 28 percent sales growth rate year over year on revenue of $7.45 billion.

It is key to note, again, that Microsoft doesn’t provider Azure sales figures by themselves. Azure revenue is counted as part of Microsoft’s Intelligent Cloud group. The company’s Intelligent Cloud group reported a 15 percent sales increase year over year on total sales of $24 billion for its fourth fiscal quarter 2023. During third-quarter 2023, Microsoft’s Intelligent Cloud group increased sales by 16 percent year over year.

AWS reported one of its lowest sales growth rates in the company’s history during second-quarter 2023. AWS’ $22.1 billion in sales represented 12 percent year-over-year sales growth. Comparatively, during AWS’ second-quarter 2022, the company increased sales by 33 percent year over year.

Operating Income

Microsoft: $10.5 billion

AWS: $5.4 billion

Google Cloud: $395 million

Microsoft’s Intelligent Cloud group reported operating income of $10.5 billion during the quarter, up $1.7 billion, or 20 percent year over year. Gross margin increased 16 percent year over year, or by $2.3 billion, according to Microsoft, driven by growth in Azure and other cloud services.

AWS captured operating income of $5.4 billion in second-quarter 2023, representing a 6 percent decline year over year compared with $5.7 billion. The drop was due to a roughly $2.7 billion increase year over year in operating expenses for AWS during second-quarter 2023.

Google Cloud generated operating income of $395 million in second-quarter 2023. In the same quarter one year ago, Google Cloud reported an operating loss of $590 million. This means the company improved its operating income by nearly $1 billion year over year in second-quarter 2023.

Global Cloud Market Share Of $65 Billion In Q2 2023

AWS: 32 percent

Microsoft: 22 percent

Google Cloud: 11 percent

Worldwide enterprise spending on cloud infrastructure services reached $65 billion in second-quarter 2023, up 18 percent, or $10 billion, year over year, according to new market-share data released by Synergy Research Group.

AWS is the world’s No. 1 market-share leader for cloud infrastructure services by capturing 32 percent global share.

Microsoft ranks No. 2 by winning 22 percent worldwide market share.

Google Cloud placed third by capturing 11 percent market share.

In aggregate, these three companies accounted for 65 percent of the global cloud services market in second-qurater 2023. Looking at Synergy Research Group’s first-quarter 2023 market share numbers, AWS won 32 percent share, Microsoft captured 23 percent share and Google Cloud won 10 percent share.

Parent Company Results; Growth Comparison

Amazon: $134.4 billion

Amazon increased revenue by 11 percent in second-quarter 2023 by generating total revenue of $134.4 billion compared with $121.2 billion in second-quarter 2022. AWS’ 12 percent sales growth year over year was on par with parent company Amazon’s growth rate.

Amazon generated operating income of $7.7 billion in second-quarter 2023, compared with $3.3 billion year over year. It’s key to note that Amazon’s North American market segment’s operating income increased the most, with operating income of $3.2 billion in the region compared with an operating loss of $600 million in second-quarter 2022.

Google/Alphabet: $74.6 billion

Google Cloud’s parent company, Alphabet, generated total revenue of $74.6 billion during the second quarter, representing a 7 percent increase year over year. Google Cloud increased revenue by 28 percent during the quarter, about four times faster than its parent company.

Alphabet reported operating income of $21.8 billion during the quarter, up from $19.4 billion year over year.

Microsoft: $56.2 billion

Microsoft reported total revenue of $56.2 billion for its fourth-quarter 2023, representing an increase of 8 percent year over year. Microsoft’s Intelligent Cloud group saw revenue growth of 15 percent year over year, nearly doubling Microsoft’s growth.

Microsoft reported total operating income of $24.3 billion, up 18 percent year over year.