Cloud-Computing Savings – Putting FAANG At Risk ✂

Cloud-Computing Savings – Putting FAANG At Risk

This past week, some of the biggest names leading not only tech but the entirety of the American economy published their previous quarter’s earnings, confirming price pressures that have debilitated several businesses. Throughout the 21st century, cloud computing has revolutionized data management for most, if not all, businesses operating through internet channels and computer applications. Just last year, the percentage of corporate data stored in the Cloud reached approximately 60%, with the global cloud computing market being worth over $540 billion. Now, in 2023, it is evident through big tech earnings reports that businesses are finding ways to cut costs associated with their data management and storage, afflicting the bottom lines of the leaders of the cloud computing space.

Amazon Web Services, Amazon’s cloud subsidiary, just reported slowing revenue growth this past quarter, following a trend of deceleration that began in the third quarter of last year. Even Google’s cloud segment reported a 28% decline in revenue growth when compared to a year prior. With a hostile macro climate, several believe these major trends in cost-cutting and cost-optimization will not only persist but have yet to truly impact the bottom line for tech. Throughout the rest of the year, investors should continue to gauge persistent levels of high costs that can in turn corrupt IT demand for these major tech corporations.

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I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

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