AWS Easily Beats Microsoft In $120B IaaS Cloud Market: Gartner

AWS, Microsoft, Google, Alibaba and Huawei combined to win 81 percent of the worldwide Infrastructure-as-a-Service market in 2022. Here’s each company’s market share and revenue figures from Gartner.

As the global cloud Infrastructure-as-a-Service (IaaS) market exploded to over $120 billion in 2022, Amazon Web Services was clearly the worldwide market-share winner by capturing 40 percent share.

AWS generated $48.1 billion in IaaS public cloud services revenue in 2022 to win 40 percent share, followed by Microsoft, which won 21.5 percent share thanks to $25.8 billion in total IaaS revenue last year, according to new data from research firm Gartner.

AWS nearly doubled Microsoft’s IaaS revenue and share in 2022 as the worldwide IaaS market grew from $92.8 billion in 2021 to $120.3 billion last year, representing a nearly 30 percent annual increase.

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“IaaS growth in 2022 was stronger than expected, despite a slight softening in the fourth quarter as customers focused on using their previously committed capacity to its fullest potential,” said Sig Nag, vice president and analyst at Gartner, in a statement. “This is expected to continue until mid-2023 and is a natural outcome of the market’s maturity.”

AWS grew its IaaS market share from 38.1 percent in 2021 to 40 percent share in 2022. Microsoft grew from 20.6 percent IaaS market share in 2021 to 21.5 percent.

On the revenue front, AWS grew sales by 36 percent in 2022 year over year, while Microsoft’s annual sales increasd by 35 percent.

Google, Alibaba And Huawei IaaS Market Share

After AWS and Microsoft, Alibaba Group won 7.7 percent share of the IaaS market in 2022, followed by Google at 7.7 percent and then Huawei at 4.4 percent.

In terms of revenue growth, Google grew annual sales by 41 percent in 2022 to just over $9 billion, Gartner reports. Huawei increased IaaS sales by 25 percent year over year to $5.2 billion, while Alibaba’s $9.3 billion in IaaS sales represented only a 2.4 percent increase compared with 2021.

Google, thanks to its cloud arm Google Cloud, saw the highest growth rate of the top five leading IaaS vendors. Gartner attributed this to Google Cloud’s increased investment in sovereign cloud and expanded sales and marketing partner programs, which helped to broaden its customer base and drive IaaS revenue.

Gartner said while Alibaba held the No. 3 spot for market share with 7.7 percent, the company has limited potential for expansion across global markets, which drove the company to spin off of its Alibaba Cloud business into a separate entity.

Five Companies Account For 81 Percent Global Share

In total, AWS, Microsoft, Alibaba, Google and Huawei captured approximately 81 percent of the global IaaS market in 2022, according to Gartner.

The IT research firm projects that IaaS revenue will “accelerate” in 2024 as there’s still “plenty” of room for market growth.

“Cloud has been elevated from a technology disrupter to a business disrupter,” said Gartner’s Nag. “IaaS is driving Software-as-a-Service (SaaS) and Platform-as-a-Service (PaaS) growth as buyers to continue to add more applications to the cloud and modernize existing ones.”