In spite of an uncertain global economic climate, several Cloud Wars Top 10 companies are offering bold guidance for growth for next quarter and all of 2023, with Oracle, ServiceNow, and SAP offering the most-bullish outlooks.
I believe these guidance numbers are important for a variety of reasons:
- On top of the solid results from across the entire Cloud Wars Top 10 for Q4 and full-year 2022, these guidance targets offer the most definitive indication of future demand from these world-changing companies
- As a reflection of market demand, they give business customers some idea of what other business leaders are thinking about committing to the cloud in the months ahead
- They serve as yet another barometer of competitive intelligence in the greatest growth market the world has ever known
Before we get to the numbers, I need to specify that not all of the Cloud Wars Top 10 companies offer guidance for their cloud businesses: AWS, Google Cloud, and IBM do not offer cloud-revenue guidance and so they are not included in this analysis.
But here’s the breakout for the seven companies that have offered cloud guidance for the coming quarter or full year, and I’ve listed the companies by their Cloud Wars Top 10 ranking.
#1 Microsoft: Fiscal Q3 Intelligent Cloud guidance of 17%-19%
This one is a little tricky because while I regularly track overall Microsoft Cloud revenue, I could not find a corresponding guidance number. Instead, Microsoft offers guidance for its various segments, and the best I can do here is offer the guidance numbers for relevant segments. For its fiscal Q3 ending March 31, CFO Amy Hood said the Intelligent Cloud segment is expected to grow by 17% to 19%, with revenue coming in at $21.7 billion to $22 billion. Within that, Hood indicated that Azure revenue growth will likely be around 31% or 32%, which would be the lowest such number for Azure that I’ve seen over the past several years.
#4 Oracle: Fiscal Q4 cloud guidance of 49%-51%
Unquestionably the high-growth outlier in the Cloud Wars Top 10, Oracle, is expecting its very high cloud growth to continue to accelerate in its fiscal Q4 ending May 31. For fiscal Q2 ended Nov. 30, cloud growth was 43%; for Q3 ended Feb. 28, it rose to 45%; and for Q4 ending May 31, CEO Safra Catz said the guidance for cloud-revenue growth is an eye-popping 49% to 51%. That range of 49% to 51% includes Cerner, and Catz said that excluding Cerner, Oracle’s fiscal-Q4 cloud growth rate will be more than 30%.
#5 SAP: Full-year cloud guidance of 22%-25%
Here we have another so-called “legacy” company entering something of a second childhood in the cloud as CEO Christian Klein guided to full-year cloud growth of 22% to 25%.
#6 Salesforce: Full-year cloud guidance of 10%
Having made the profound transition from a growth company to a profit-centric company, Salesforce is guiding to 10% revenue growth for fiscal Q1 ending April 30 and for the full fiscal year ending Jan. 31.
#8 Workday: Full-year cloud guidance of 17%-18%
With its annualized subscription revenue now exceeding $6 billion, Workday guided to full-year revenue growth of 17% to 18%. For comparison’s sake, the company grew throughout the past year at a steady 22% rate.
#9 Snowflake: Fiscal Q1 guidance of 44%-45%
Acknowledging that some of its smaller customers have slowed their consumption rates, Snowflake has offered product-revenue guidance of 44%-45% for its fiscal Q1 ending April 30. As always, I want to note that, while taking nothing away from Snowflake’s superb growth numbers, it is much smaller than all of the other Cloud Wars Top 10 companies so its numbers need to be viewed in that context.
#10 ServiceNow: Full-year cloud guidance of 22.5% to 23.5%
Rolling toward its goal of becoming a $16-billion company within the next few years, ServiceNow has guided to a very healthy cloud revenue growth of 22.5% to 23.5% for calendar 2023.
Across a very strong field — particularly in light of the murky economic environment — the clear leaders in the bullish outlook for the coming few months or full year are Oracle, ServiceNow, and SAP.
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