AWS, Azure And Google Cloud Accounted For 64% Cloud Infra Services Spending In Q1 CY23: Report

Top three hyperscalers Amazon Web Services (AWS), Microsoft Azure and Google Cloud, collectively grew 22 per cent (compared to 26 per cent in Q4 2022) to account for a 64 per cent share of customer spending in Q1 2023.

During the first three quarters of 2023, the worldwide cloud infrastructure services spending increased 19 per cent to USD 66.4 billion in Q1 2023. 

AWS was the leading cloud service provider in Q1 2023, accounting for 32 per cent of total spending after growing 16 per cent year-on-year (YoY), dropping below the 20 per cent growth mark for the first time, according to Canalys estimates.

During the quarter, Microsoft Azure was the second largest cloud service provider in Q1 2023, with a 23 per cent market share (grew by 27 per cent YoY). Meanwhile, Google Cloud grew 30 per cent in the latest quarter and accounted for 9 per cent market share.

Interestingly, the Canalys report noted that despite cloud being one of the fastest-growing IT segments, customer investments are slowing down due to macroeconomic uncertainties. In fact, the growth in spending has fallen below 20 per cent. 

“Enterprises are reducing cloud spend as part of overall cuts to IT budgets, with a clear emphasis on optimizing cloud costs, gaining control over cloud wastage, and improving the efficiency of cloud deployments,” mentioned the report.  

The report noted that all cloud hyperscalers have seen their growth fall decline by four percentage points from Q4 2023. 

During the Q1 2023, Asia-Pacific saw weakest performance in cloud customer spending. Cloud services spending will continue to be slow through second half of the year.