7 Largest Cloud Providers By Revenue in 2017

What are the 7 largest cloud providers by revenue in 2017? The term “cloud” has become very popular lately, being used everywhere from offices to private households. Most people have several accounts on cloud platforms, one that comes with the operating system, be it either Windows or Mac OS, and one either on Dropbox, Google Cloud, or another platform. On the enterprise size, Amazon dominates the market, with a market share of 45% in the Infrastructure-as-a-Service (IaaS) space, according to Synergy. This is more than Microsoft, Google and IBM combined.

In basic terms, cloud computing involves storing and accessing data on a server via the internet rather than on a physical hard drive. There are several types of cloud computing for enterprises. First, there is Software-as-a-Service (SaaS), through which users can access software that is running on servers. SaaS is something that most people use everyday, with the best examples of it being Microsoft Corporation (NASDAQ:MSFT)’s Office 365 or Google Apps. Then there is Platform-as-a-Service, or PaaS, which involves providing businesses with a platform to develop their products and services. Finally, there is Infrastructure-as-a-Service (IaaS), through which providers offer cloud servers and resources, basically allowing their clients to have a virtual data center.

Using cloud computing can have many advantages. For regular users, it provides access to data (photos, documents, presentations, etc.) anywhere where there is a stable internet connection, without the need to carry around USB sticks or portable hard drives. For businesses it can be a real cost saver. Using PaaS and IaaS allows companies to focus on the development of their product(s) without the need to invest in expensive and redundant hardware, which also require maintenance, space, and regular upgrades.

Because cloud computing has only really begun to develop in the last few years, companies that provide cloud computing services are in a market that will continue expanding at a fast pace, at least in the medium-term. According to IDC research, by 2019, worldwide spending on public cloud services will reach $141 billion, double the $70 billion total in 2015. The largest share will be occupied by the SaaS segment, which will amass over two-thirds of all public cloud spending. The main drivers of this growth will be large companies, which are estimated to spend over $80 billion on cloud services in 2019.

While there are many companies that are trying to capture a slice of the booming cloud services market, only a few companies have already managed to establish themselves as leaders. Unsurprisingly, most of these are companies that were tech giants long before cloud computing. Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), Alphabet Inc (NASDAQ:GOOGL), and a few others, which we discussed in our list of the 10 Biggest Cloud Computing Companies in the World, had the resources to invest and the client base that could take advantage of the potential of cloud services.

With this in mind, let’s take a look at the 7 largest cloud providers by revenue in 2017. The data for each company’s revenue is taken from their latest quarterly financial reports (or in the case of Alphabet, from analyst estimates). Check out the list beginning on the next page.

7. SAP SE (ADR) (NYSE:SAP)

Cloud Revenue: $1.02 billion

SAP SE (ADR) (NYSE:SAP) is a software and service provider. The company’s cloud revenue amounted to 906 million euro ($1.02 billion) in the first quarter of 2017, up by 34% on the year. The company has high expectations for its cloud business; in a presentation in May, SAP SE (ADR) (NYSE:SAP) said that it plans to generate more revenue from cloud than from software between 2018 and 2020.

6. Oracle Corporation (NYSE:ORCL)

Cloud Revenue: $1.19 billion

For the third quarter of its fiscal year 2017 (ended February 28), Oracle Corporation (NYSE:ORCL) that ranks 6th on our list of largest cloud providers by revenue in 2017 reported cloud revenue of $1.19 billion. The largest share of this amount ($1.01 billion) was generated by the company’s cloud software as a service and platform as a service offerings, with $178 million coming from cloud infrastructure as a service. Moreover, to expand its cloud business, Oracle Corporation (NYSE:ORCL) acquired NetSuite, a provider of cloud-based enterprise resource planning software, last year.

5. Alphabet Inc (NASDAQ:GOOGL)

Cloud Revenue: $1.8 billion (fourth quarter)

Alphabet Inc (NASDAQ:GOOGL) doesn’t provide data for its cloud business separately, but includes it in its Google division, which also includes its Search, Ads, Commerce, Maps, YouTube, and other segments, so it’s Alphabet’s largest division. However, some analysts provide estimates for the company’s cloud revenue. According to Pacific Crest Securities, in the fourth quarter of 2016, Alphabet Inc (NASDAQ:GOOGL)’s cloud revenue amounted to $1.80 billion.

4. salesforce.com, inc. (NYSE:CRM)

Cloud Revenue: $2.20 billion

Next in line in our list of the 7 largest cloud providers by revenue in 2017 is salesforce.com, inc. (NYSE:CRM), which provides enterprise software that is delivered through the cloud. The company’s cloud business delivered revenue of $2.20 billion for its fiscal first quarter (ended April 30). Aside from the revenue generated through subscription fees and additional services, salesforce.com, inc. (NYSE:CRM) also obtains revenue from some professional services, such as process mapping and project management.

 3. International Business Machines Corp. (NYSE:IBM)

Cloud Revenue: $3.50 billion

International Business Machines Corp. (NYSE:IBM) provides cognitive solutions on cloud platforms and is the global leader in enterprise cloud, with annual revenue of $14.6 billion. For the first quarter of 2017, the company delivered revenue of $3.50 billion from its cloud business, which represented an annual increase of 33% on a reported basis.

2. Amazon.com, Inc. (NASDAQ:AMZN)

Cloud Revenue: $3.66 billion

At the second place on our list of largest cloud providers by revenue in 2017 we have the Amazon.com, Inc. (NASDAQ:AMZN)’s cloud business mainly involves its Amazon Web Services (AWS), which provides on-demand cloud computing platforms to companies, individuals, and governments. The company’s technology allows subscribers to have virtual computers with the same attributes of a physical computer and its associated application software. For the first three months of 2017, Amazon.com, Inc. (NASDAQ:AMZN)’s AWS segment generated revenue of $3.66 billion, which represented an increase of 43% on the year.

1. Microsoft Corporation (NASDAQ:MSFT)

Cloud Revenue: $6.76 billion

Microsoft Corporation (NASDAQ:MSFT)’s cloud business is spread across several segments. However, the largest part of its cloud revenue comes from its Intelligent Cloud segment, which includes public, private, and hybrid server products, such as Azure, Windows Server, and Microsoft SQL Server. The Intelligent Cloud segment generated revenue of $6.76 billion in the first quarter of 2017. In addition, Microsoft Corporation (NASDAQ:MSFT)’s Productivity and Business Processes includes Office 365, a cloud-hosted set of applications on a SaaS basis, and Dynamics 365, a set of cloud-based applications across Enterprise Resource Planning and Customer Relationship Management.

These are the 7 largest cloud providers by revenue in 2017. As stated earlier, most of the companies on this list are well-established hardware and software companies, which had the resources and capability to seize the opportunities in the market and invest in a booming industry.

Disclosure: None