Q2 Cloud Market Grows by 29% Despite Strong Currency Headwinds; Amazon Increases its Share

RENO, NV, July 28, 2022

New data from Synergy Research Group shows that Q2 enterprise spending on cloud infrastructure services approached the $55 billion mark. Despite turbulence in currency markets and a much strengthened US dollar, that still represents 29% growth from last year. Had exchange rates remained constant over the last year, the growth rate would have been around six percentage points higher. As spending on cloud services continues to rise inexorably, Amazon’s worldwide market share increased by over a full percentage point to almost 34%. Google also saw a meaningful uptick in its market share during the quarter. Amazon, Microsoft and Google combined had a 65% share of the worldwide market in the quarter, up from 61% a year ago. In aggregate all other cloud providers have grown their revenues by over 150% since the beginning of 2018, though their collective market share has plunged from 49% to 35% as their growth rates remain far below the market leaders. With most of the major cloud providers having now released their earnings data for Q2, Synergy estimates that quarterly cloud infrastructure service revenues (including IaaS, PaaS and hosted private cloud services) were $54.7 billion, with trailing twelve-month revenues reaching $205 billion. Public IaaS and PaaS services account for the bulk of the market and those grew by 31% in Q2. The dominance of the major cloud providers is even more pronounced in public cloud, where the top three control 72% of the market. Geographically, the cloud market continues to grow strongly in all regions of the world.

“As the cloud market continues to surge, the biggest story in Q2 was all about macroeconomics rather than actual cloud usage. When country market numbers are aggregated in US dollars, the yearly growth rate dropped by over six percentage points due to foreign exchange movements, with over half of that reduction being accounted for in Q2 alone,” said John Dinsdale, a Chief Analyst at Synergy Research Group. “As evidenced by this week’s earnings calls, global cloud providers are certainly not immune from the impact of ongoing shifts in exchange rates. However, the fact remains that the underlying growth in cloud usage continues to grow at truly impressive rates. This has caused a clear acceleration in both the launch of new hyperscale data centers and the level of spending on data center hardware and software. Our forecasts show continued strong growth in all key cloud market metrics.”