Proving that success in the cloud requires expertise in where customers have been as well as in where they want to go, old-timers Oracle and SAP plus Google Cloud are the leaders in the Cloud Wars Top 10 growth chart as we jump into 2023.
Here’s the new lineup for the world’s fastest-growing and most-influential cloud providers, and then I’ll offer a couple of thoughts on each. And please bear in mind that this list below is not the official Cloud Wars Top 10 rankings — rather, it’s a stack-rank of the growth leaders. The last column on the right shows where each company ranks on the Cloud Wars Top 10.
Fastest-Growing Major Cloud Providers as of Jan. 4, 2023
|Company||Growth Rate||Qtr. Ended||Top 10 rank|
|1. Oracle||43%||Nov. 30||#4|
|2. SAP||38%||Sept. 30||#5|
|3. Google Cloud||37.5%||Sept. 30||#3|
|4. Amazon AWS||27%||Sept. 30||#2|
|5. Microsoft||24%||Sept. 30||#1|
|6. Workday||22.3%||Oct. 31||#8|
|7. ServiceNow||22%||Oct. 31||#10|
|8. IBM||19%||Sept. 30||#7|
|9. Salesforce||14%||Oct. 31||#6|
|10. Snowflake**||67%||Oct. 31||#10|
(**Snowflake is at bottom of list because its revenue figures are so much lower than that of the other Top 10 companies. When Snowflake quarterly revenue reaches $1 billion, I’ll rank it in the same way as the others.**)
No doubt the tough global economy, the ravages of inflation, and the superstrong dollar have each played a part in framing each of these numbers, but every single company on this list has had to deal with those same factors — so nobody gets a pass. And for the sake of comparison, here’s the Cloud Wars Top 10 growth chart from two months ago: “Cloud Q3 Growth Leaders: #1 Oracle, #2 SAP, #3 Google, #4 AWS.”
Six of these Cloud Wars Top 10 companies have quarters ending on Jan. 31, so in early February, I’ll post an updated growth-chart list including those new figures. Until then, here are a few thoughts on each company, organized in the order shown above in the growth-rate chart.
1. Oracle, 43%. Huge momentum across its LOB (line-of-business) apps business (Fusion Cloud ERP, Fusion HCM, NetSuite Cloud ERP), which will close about $14 billion in revenue this year; its industry-cloud business; and its OCI (Oracle Cloud Infrastructure) business, which last quarter grew at a 59% clip. Plus, customers are beginning to make big commitments with mission-critical workloads to cloud-native Autonomous Database.
2. SAP, 38%. The biggest growth driver for SAP is its S/4HANA Cloud ERP suite, which for the past few quarters has been growing at 80% or higher. Plus, the Business Technology Platform is becoming a huge asset for SAP as it gives incumbent customers another big reason to stick with SAP as they move production ERP (enterprise resource planning) workloads to the cloud.
3. Google Cloud, 37.5%. It’s been a remarkable run for Google Cloud in the past four years under CEO Thomas Kurian as the company has gone from internally focused tech laboratory to customer-driven transformation enabler. Two hot areas for 2023: industry-specific solutions and multicloud solutions including, but not limited to, Anthos.
4. AWS, 27%. A slew of new products were churned out at re:Invent a couple of months ago, but as the competition in the Cloud Wars Top 10 gets even more savage in 2023, AWS must pivot from competing on volume of new product introductions to new ways of driving value for business customers. Will it make a stronger play for industry expertise in 2023?
5. Microsoft, 24%. When Microsoft releases its fiscal-Q2 earnings at the end of this month, it will be fascinating to see if it was able to reach $100 billion in cloud revenue for the calendar year. A few months ago, I would have said that achievement was a lock — but with Microsoft’s declining growth rate, I now think it’ll be a stretch. For the first three quarters of 2022, its revenue was $23.4 billion, $25.11 billion, and $25.7 billion, meaning it needs $25.8 billion for the quarter ended Dec. 31. I’m betting they’ll make it—but not by much.
6. Workday, 22.3%. Low-key but high-performance Workday keeps hammering out impressive numbers quarter after quarter as it adds new Fortune 1000 customers for its HCM and Financials applications. I’m looking for the company’s more-aggressive push into industry-specific solutions to be a huge factor in ensuring Workday’s momentum continues throughout 2023.
7. ServiceNow, 22%. In 2023, ServiceNow needs to redefine itself in a way that not only differentiates it from what it used to be but also in why and how it’s a better choice for platform-specific requirements of customers. Over the past several years, ServiceNow has not had to compete with the other major players — but I think that’s going to change radically in 2023.
8. IBM, 19%. With his company’s cloud-revenue growth rate rising throughout 2022, IBM CEO Arvind Krishna is bullish on the 112-year-old company’s prospects for 2023 around its expertise in hybrid cloud, artificial intelligence (AI), and data. Krishna highlighted the big businesses IBM’s building with former competitors Microsoft and Amazon. Plus, its ability to assertively complement its technological prowess with deep industry knowledge via IBM Consulting is a big benefit for customers.
9. Salesforce, 14%. No, that’s not a typo — Salesforce’s growth rate did indeed plunge to 14% for the quarter ended Nov. 30 after several years of 20% or more. And I think until Salesforce can address these five major questions about its precipitous stumble and tumble last quarter, it’s going to have a very tough time regaining its former market momentum.
10. Snowflake, 67%. With product revenue reaching $522 million for the quarter ended Nov. 30, Snowflake continues to have huge momentum. But its overall size relative to the other companies in the Cloud Wars Top 10 leads me to isolate it and its growth rate in these head-to-head matchups. The company’s banking on its industry focus to keep that big momentum rolling throughout 2023.
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