Google Cloud Surges 82%, Threatens to Dethrone Amazon Web Services

Alphabet's cloud computing business is growing rapidly, with Google Cloud revenue surging by 82% year over year. This growth has led to a massive backlog of $514 billion in promised revenue. CEO Sundar Pichai highlighted this figure on the earnings call, emphasizing the unit's potential.

The AI-fueled growth spurt is driving this expansion, with nearly 90% of Fortune 100 companies using Gemini Enterprise. This has significantly boosted Google Cloud's share of Alphabet's total revenue, from a small slice to over 20%. Its net operating income more than tripled year over year, outperforming the Google services segment, which posted a 20% improvement.

Google Cloud is gaining ground on Amazon and Microsoft in the cloud infrastructure market. While Amazon has a significant lead with 28% market share, Alphabet's 14% share is growing faster. If current growth rates hold, it's feasible that Alphabet could claim the silver medal within a few years.