Alibaba Cloud’s revenue increased 60% year-on-year, surpassing IBM as the fourth largest public cloud service provider

Alibaba, which entered the cloud infrastructure market in 2015, is now a heavyweight player in the field. In its latest quarterly results, Alibaba reported revenue of $2.194 billion from its cloud business, surpassing IBM ($1.65 billion) as the world’s fourth-largest. Amazon’s AWS still leads the way in cloud infrastructure, with third-quarter revenue of $11.6 billion, while Microsoft’s Azure came in second with $5.9 billion. Google Cloud remained in third place, with revenue of $3.44 billion in the last quarter.

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Alibaba Cloud On Cloud Carnival

While Alibaba’s revenues are still lower than Google’s, the latest figures show it has become the world’s fourth-largest provider of public cloud computing. According to market share data from Synergy, a market research firm, Amazon is 33 per cent, Microsoft is 18 per cent, Google is 9 per cent, Alibaba is 5 per cent, IBM is close to 5 per cent, Salesforce is 3 per cent, Tencent and Oracle are 2 per cent each, and NTT and SAP are 1 per cent each.

It remains to be seen whether Alibaba Cloud will catch up with Google Cloud in the short term, especially under Chief Executive Thomas Kurian, who is becoming more focused. Still, Alibaba’s success in surpassing IBM’s decades-long success as a newbie in corporate computing remains impressive.

Alibaba Cloud's revenue increased 60% year-on-year, surpassing IBM as the fourth largest public cloud service providerAlibaba Cloud's revenue increased 60% year-on-year, surpassing IBM as the fourth largest public cloud service providerAlibaba Cloud's revenue increased 60% year-on-year, surpassing IBM as the fourth largest public cloud service provider

Alibaba Cloud’s 60 per cent growth rate is slightly higher than the 59 per cent growth rate in the previous quarter, but has remained largely stable, which is not easy for large companies with already reached fairly high levels of revenue. That compares with a 29% year-on-year increase in revenue from Amazon AWS and a 48% year-on-year increase in Microsoft Azure.

“We believe cloud computing is the infrastructure of the digital age, but it’s still in its early stages of growth,” said Zhang Yong, Alibaba’s chairman and chief executive, on a earnings conference call. We are committed to further increasing our investment in cloud computing. China remains our main market, and digital transformation driven by the new crown pneumonia epidemic is the main driver of steady growth. “

Mr Zhang added: “The cloud business is growing very fast. Obviously, we’re seeing digital transformation in all industries. Moving to cloud computing is a very important step for these industries. Eventually, most of the business will be done in the cloud, and this growth is likely to continue in the medium term, as many companies still haven’t made the transition yet. But over time, they will do the same. “

John Dinsdale, an analyst at Synergy Research, a market research firm, said that while China remained Alibaba Cloud’s main market, its business was expanding overseas and the company was capable of making long-term investments. “While Alibaba is still quite small compared to its presence in China, it has established data centers and cloud operations in many countries, including six other Asia Pacific countries, the US, the UK and the UAE,” Mr Tinsdale said. Among them, it is a market leader in Indonesia and Malaysia. “