Amazon Web Services posts record $13.5B in *profits* for 2020 in Andy Jassy’s AWS swan song

It turned out that Andy Jassy already ran most of Amazon.

Amazon Web Services, the cloud computing giant led by the future CEO of Amazon, ended 2020 with more than $ 13.5 billion in annual operating profit, accounting for more than 63% of the company’s operating profit accounted for $ 45.3 billion year over year, an increase of nearly 30% year over year.

AWS is “arguably the world’s most profitable major tech company,” said Brian Olsavsky, Amazon’s chief financial officer, in a conference call with analysts and investors following the fourth quarter earnings report on Tuesday afternoon, speaking to Jassy’s experience and credentials for leading the larger ones Company.

Those are many qualifiers, but the bottom line is that Amazon continues to leverage its position as the market leader in public cloud computing. Jassy has essentially built one company within a company since launching Amazon Web Services more than 15 years ago. This was one of the factors that led him to choose the Amazon board to succeed founder Jeff Bezos as CEO of Amazon.

Synergy Research Group diagram

In the fourth quarter, AWS revenue increased 28% to $ 12.7 billion. By comparison, Google Cloud posted revenue of $ 2.78 billion on Tuesday for the same period, up 52% ​​on a smaller basis. Microsoft, the second largest public cloud provider, reported a 50% increase in revenue for its Azure cloud computing platform last week without disclosing a dollar figure.

Total cloud infrastructure services spend increased 32% to nearly $ 40 billion in the fourth quarter, according to research firm Canalys.

“This is again the largest quarterly expansion in US dollars as ongoing pandemic restrictions intensified the demand for clouds to support remote working and learning, e-commerce, streaming content, online gaming and collaboration,” Canalys wrote in a report on Tuesday afternoon. “At the same time, a gradual recovery in economic confidence stimulated cloud investments by companies across all industries to drive digital transformation.”

The Synergy Research Group found similar trends, noting that Amazon largely held its market share, even though Microsoft, Google, and Alibaba have grown over the past four years.

“Amazon’s market share remained in the 32-34% range for the entire four-year period,” said Synergy Research. “The losers in market share were the large group of smaller cloud providers who lost a total of 13 percentage points of market share in the last 16 quarters. Among the large cloud providers or large companies with only a small position in the market, the best known are IBM, Salesforce, Tencent, Oracle, NTT, Baidu, SAP, Fujitsu and Rackspace. “

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