Analysts at Jefferies said in its first quarter cloud update that Microsoft (NASDAQ:MSFT) Azure is gaining share in the market at the expense of Amazon (NASDAQ:AMZN) AWS, which is losing share.
The investment firm, in a research note, said Microsoft is the biggest share gainer as customers focus more on artificial intelligence platforms, while Amazon has been the biggest share loser for six straight quarters.
Overall, combined cloud growth for the "Big 3" (Amazon AWS, Microsoft Azure and Google Cloud) accelerated ~280bps to 24% year-on-year in Q1, reaching a ~$200 billion annual run rate, according to Jefferies.
"We believe Q1 results make it clear that customers have shifted their focus from cloud cost optimization back to modernizing their workloads for AI," wrote the firm.
"Our top AI winner, MSFT, is ramping Capex the most in FY24 & FY25 to handle future AI workloads," added Jefferies. "[The] results point to inflecting consumption trends & gradual AI tailwinds with the big 3 combined cloud growth accelerating 3 pts to 24% y/y."