Amazon's CFO narrows down the success of its $10 billion cloud business to 3 factors


AWS Loft

Business Insider/Eugene Kim

Beer service at the AWS Loft in San Francisco.

Amazon's cloud computing business, Amazon Web Services, didn't fail to impress again this quarter.


It had $2.8 billion in revenue, up 58% year-over-year, on a healthy 25% operating margin. That puts AWS on a very impressive $11 billion revenue run rate.

"We feel like we're in the leadership position and we're looking to expand that," Amazon CFO Brian Olsavsky said about AWS's growth during the press call on Thursday.

Olsavsky went on to attribute the success of AWS to 3 factors:

Functionality and pace of innovation: AWS added 422 new services and features in the first half of this year vs. 722 in all of last year. It also continues to keep up with important trends by adding data analytics and machine learning functionalities.


Partner and customer ecosystem: AWS struck a big partnership deal with Salesforce last quarter, while adding a bunch of customers running SAP on AWS, like GE Oil & Gas, Kellogg's, and Brooks Brothers. It's also expanded to Mumbai last quarter, making it available in 13 infrastructure regions globally.

Experience: AWS started offering public cloud computing services nearly 10 years ago, way before any of its competitors did. That's given it a huge head start, as AWS's revenue is estimated to be more than 4 times Microsoft Azure's, the second largest provider.

Olsavsky didn't rule out the chances of other competitors potentially expanding its presence, given the size of the public cloud space in general. But he sounds pretty confident AWS won't lose its leading position any time soon.

"There's plenty of room for multiple winners in this business...we feel good about the business position we're in, and our position with customers," he said.

Disclosure: Jeff Bezos is an investor in Business Insider through hispersonal investment company Bezos Expeditions.


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