(Note: After an award-winning career in the media business covering the tech industry, Bob Evans was VP of Strategic Communications at SAP in 2011, and Chief Communications Officer at Oracle from 2012 to 2016. He now runs his own firm, Evans Strategic Communications LLC.)
Despite posting excellent first-quarter cloud-revenue growth of 49% to $5.44 billion, Amazon actually lost ground in its efforts to overtake Microsoft as the world's leading enterprise-cloud provider as Satya Nadella's company reported its commercial-cloud revenue jumped 58% to $6.0 billion.
With Microsoft Azure Q1 revenue soaring 93% and Dynamics 365 SaaS revenue rising 65%, the better-than-expected growth is directly attributable to businesses across every industry "moving quickly to seize the digital dividend using data and AI," said executive vice-president Judson Althoff in a blog post released with the earnings.
The gap between Microsoft's cloud revenue and Amazon's is widening as earlier this year, Microsoft posted fourth-quarter 2017 enterprise-cloud revenue of $5.3 billion while Amazon came in at $5.1 billion.
IBM, which in Q4 shocked the market by beating both Microsoft and Amazon with Q4 cloud revenue of $5.5 billion, last week posted Q1 cloud revenue of $4.2 billion, up 20%, with the relative quarter-on-quarter decline being the result of seasonality in IBM's business.
Those inside-the-industry competitive issues aside, the big story in pushed by Microsoft in Althoff's blog post was the rapid, sweeping and worldwide move by businesses across all industries into digital-first strategies that are allowing them to understand customers and opportunities more clearly, make better decisions more quickly, reduce costs while boosting quality, and embrace AI and data as indispensable elements within their operations.
Here are summaries of a handful of the customer stories cited in the Microsoft blog:
- Saxo Bank, which offers “banking as a service” and access to 35,000 financial instruments in 170 countries is moving most of its technology stack to Azure to boost the power and scale of its services
- Eagle Investment Systems, which oversees $21 trillion in managed assets, is helping investment managers capture data and ensure its validity through a cloud-based data-management platform running on Azure that Eagle created in partnership with Microsoft.
- UPS is deploying AI to improve customer service via Azure Bot Service and Cognitive Services for the UPS Bot, which converses in text and voice with customers.
- 24 Hour Fitness is deploying Dynamics 365 and Adobe Experience Cloud across its network of more than 420 clubs to offer more personalized and unified physical/digital experiences during workouts—or as Microsoft called it, "their fitness journey."
- Toyota Material Handling Europe is using Azure, AI and Mixed Reality to train pallet drones to recognize patterns, automate processes and learn the flow of a manufacturing factory floor.
- Bühler AG is improving its food-safety practices via a faster and more precise grain-sorting solution that screens out 85 to 90 percent of contaminated and toxic grain, compared to 50 percent for conventional sorting machines.
- Coca-Cola Co. is using Microsoft 365 and Microsoft Azure to simplify its architecture, drive automation, deliver technology updates with less disruption, improve employee experiences and deliver proactive threat-protection.
Over the past year, I've made the case repeatedly that Microsoft's the top cloud company in the world not only because of its revenue numbers but also because of its customer-centric vision for how it weaves its vast arsenal of traditional and new technologies together via the cloud.
And the company's latest financial results prove beyond a doubt that Microsoft's ability to deliver innovative and data-centric solutions across all three layers of the cloud—IaaS, PaaS and SaaS—is being endorsed strongly by companies in every industry in the world.
To Amazon and IBM: well done, and keep those chins up—it's a big world with tons of opportunity for great enterprise-tech companies that can provide help businesses seamlessly connect traditional technology running core operations with new tools that are becoming absolutely indispensable in the emergent digital age.
But in the Cloud Wars, Microsoft's setting a standard that—at least for now—is becoming very, very hard to meet, let alone exceed.