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AWS, earnings, subscale, vendors results, enterprise adoption, M&A, expansions

  • February 14, 2022
  • Analyst: Philbert Shih

A busy week across the sector saw more strategic activity, interesting customer wins and subscale cloud expansion. We also take a closer look at the results from AWS.

AWS reported its results last week and again showed significant growth acceleration. AWS grew 37% y/y in 2021 and even picked up the pace moving into the second half of the year. We look at some of the drivers. The operating margin for AWS has always been impressive and this is expected to continue if not improve. Scale and efficiency continues to drive the business.

On the private company side, there were some interesting disclosures. Vultr shared some useful numbers and storage vendor StorPool disclosed data points that speak to the health of the service provider channel.

Adoption of outsourced infrastructure continues to accelerate and it is no surprise that large organizations are betting bigger on cloud. TD Bank in Canada expanded its use of Azure, while Best Buy continues to push forward with AWS.

The strategic arena remained busy, especially in the MSP and managed cloud world. Rackspace recently acquired Singapore-based Just Analytics, UKCloud was acquired by a new investment vehicle and Thrive continued its consolidation efforts with the purchase of a MSP in Miami. In APAC, Etix Everywhere acquired a stake in a Thai data centre operator, while Singapore’s CapitaLand is investing to build in India. Elsewhere, Sabey Data Centers brought in capitalBlackstone invested more in VNET and a new WordPress hosting startup raised a small round to fund growth initiatives.

Hyperscale expansion continues across the globe, but subscale clouds are also widening their footprints. Vultr shared data points about its footprint, while Hivelocity expanded to Poland and Maxihost entered London. All these providers primarily use colocation.

Finally, there were more details about the Roblox outage last year. The post-mortem speaks to a number of end user dynamics.

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