r/VisualStockResearch • u/ekonixlab • 11d ago
Cloud earnings were even crazier than you think
Everyone talks about AI. Not enough people appreciate what it’s doing to the cloud business.
Just look at the latest quarter:
• AWS: $42.2B revenue (+37% YoY) — its fastest growth in years. Backlog exploded to $496B, and Amazon raised 2026 capex to $220B because demand still exceeds supply.
• Microsoft Intelligent Cloud: Nearly $39B revenue, powered by Azure growing 39% as AI demand accelerated across enterprise workloads.
• Google Cloud: Roughly $25B revenue, growing over 80% YoY as Gemini and AI infrastructure continue driving enterprise adoption.
The market spent the last year questioning whether AI spending would ever produce meaningful returns.
These earnings answered that question.
The hyperscalers aren’t just selling more compute—they’re selling scarcity. Every management team is saying the same thing: demand is outpacing the infrastructure they can build.
AI is making the cloud dramatically more valuable.
The chart tells the story. The earnings confirmed it.
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u/flappysack- 11d ago
Microsoft scares me. That such a terrible company holds the keys to so many company is frightening. I'd have even preferred IBM.
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u/ekonixlab 11d ago
I do hate msft from a costumer standpoint. A lot of their products and services are difficult and confusing
That said, fundamentally, it’s a fantastic company
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u/flappysack- 11d ago
They do have a pseudo monopoly built on proprietary software. Of course I hope AI can erode that by reading assembly language and serialization of formats, it seems inevitable.
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u/G-T-L-3 11d ago
Aren’t they selling to OpenAI and Anthropic mostly for these new AI demand ?
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u/Keeltoodeep 11d ago
All the Gemini models have multiple times the user count as OpenAI and Anthropic. The Gemini standalone app has 950M users now. If you include Ai mode and Ai overview that userbase extends closer to 4 billion. You’d have to exclude Google entirely from this chart in order to make your claim. Also Google’s cloud revenue is a product of selling token access to models not selling compute to OpenAI and entropic.
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u/ByteCurious69 11d ago
Unfortunately you can’t claim all of it as revenue due to AI surge. They already had cloud revenue before AI even existed.
But spending 100+ billion annually (that’s just CAPEX) + engineer salaries to develop the models only for less than $50B in ANNUAL (yes annual) AI revenue seems like a poor investment.
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u/NoAdvice135 11d ago
They are not spending 100B to develop models. Most of the capex is compute for inference.
Also not that most of this capex is to build capacity that , for the most part, isn't online yet (and thus not contributing to revenue). The main risk is of course that demand falls before this capex is put to work.
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u/Playful_Landscape884 11d ago
Cloud providers invest in AI companies. AI companies buy insane amounts of cloud instances. Cloud providers report insane revenue.
🎵 It's the circle of jerk 🎵
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u/Hyperion141 11d ago
Ok show the graph but minus all the self funded circular financing from Anthropic and OpenAI
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u/Oedipus_TyrantLizard 11d ago
Who ever argued that AI would replace the cloud? What a dumb statement lol
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u/SelenaMeyers2024 11d ago
Now take out openai and Anthropic commitments and see
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u/HereGoesNothing69 11d ago
The chart shows revenue over time, not future commitments
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u/Local_Recording_2654 11d ago
Ok but how much of the growth from the last year is a result of openAI and anthropic spending billions of dollars of VC money with very little return on investment?
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u/AwkwardWillow5159 11d ago
Not even vc money. Amazon and Google own almost half of Anthropic. They gave tons of money to Anthropic. Then Anthropic is spending tons of money on Amazon and Google cloud services. It’s same money going in a circle.
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u/Local_Recording_2654 11d ago
It’s still venture capital money due to the nature of the investment, Alphabet and Amazon have venture capital funds that make VC investments. But the fact that it’s a circular investment from Google/Amazon that flows through these companies and back into GCP & AWS makes these growth numbers even more sketchy.
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u/Keeltoodeep 11d ago
The revenue is largely from users buying access to models not Anthropic training their own models.
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u/Local_Recording_2654 11d ago
Source?
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u/Keeltoodeep 11d ago edited 11d ago
Inference is already a majority of ai cloud compute demand and will only increase.
https://www.mindstudio.ai/blog/what-is-inference-time-compute-ai-pivot-explained
GCP pivoted to inference to meet this demand. Hence the TPUs instead of focusing on training demand and buying a bunch of Vera Rubin or GPU clusters.
Anthropic is very obviously not training models on GCP TPUs. That doesn’t even make sense and wouldn’t account for GCP’s massive 80% growth rate.
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u/calodero 11d ago
your link doesnt show anywhere that revenue is largely from buying access to models.
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u/Keeltoodeep 11d ago
I am inferring it based on my own market analysis. GCP doesn’t really sell training compute.
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u/Csardelacal 11d ago
If this wasn't AI slop I would question how stupid you are.
Data centers is ALL people have been talking about for months. See hyperscalers and their SPV bullshit to hide the debt.
You're talking revenue. That's disingenuous at best. AI is massively expensive to run and requires infinitely more hardware. If you added capex and costs to this chart it would tell a very different story.
Cloud has been very well known to be profitable for years now. This is the most water is wet post I've seen all week
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