Tom Tunguz

APRIL 25, 2023

Google Cloud Platform (GCP) & Microsoft Azure had strong quarters with about 28% annual revenue growth each. But the story in this quarter’s reports is AI. In Azure, we expect revenue growth to be 26% to 27% in constant currency, including roughly 1 point from AI services.

AI Search 200

AI Search AI Azure GCP(Google Cloud Platform) 200

Tom Tunguz

NOVEMBER 28, 2023

“Q3 product revenue grew 34% year-over-year to reach $698 million. " As with many other companies reporting strength in the market, AI & unstructured data workloads are fueling growth. “I don’t even hear the words AI and budget in the same sentence.”

GCP(Google Cloud Platform) 137

GCP(Google Cloud Platform) Azure Data Startup 137

Clouded Judgement

MAY 10, 2024

And no one raised full year guide >2% The median “beat” (Q1 revenue over Q1 consensus estimates) was 1.5%, which is the lowest it’s been in the last 4 years Overall, it’s been a TOUGH quarter for software companies. So far - you’re either tied to AI tailwinds, or it’s rough out there.

Cloud 161

Cloud Software GCP(Google Cloud Platform) Azure 161

Tom Tunguz

JULY 25, 2023

Both Google & Microsoft announced growth rates in GCP & Azure that held steady from one quarter to the next. There are two forces in tension : overall cost reduction efforts by companies & the desire to invest in AI. The desire for AI is broad.

Azure 196

Azure GCP(Google Cloud Platform) AI Cloud 196

Clouded Judgement

NOVEMBER 10, 2023

When I think about the monetization of AI (and which “layers” monetize first) I’ve always thought it would follow the below order, with each layer lagging the one that comes before it. Model providers (OpenAI, Anthropic, etc as companies start building out AI). 2024 will be the year of AI applications!

Cloud 183

Cloud Artificial Intelligence AI GCP(Google Cloud Platform) 183

Clouded Judgement

AUGUST 11, 2023

While the overall median revenue multiple of the software universe is ~6x (which is ~25% below the long term average of ~8x), high growth software is currently trading at a premium to it’s long term average (9.4x And everyone hoping for AI acceleration will need to wait. Revenue multiples are a shorthand valuation framework.

Cloud 130

Cloud Trends Azure GCP(Google Cloud Platform) 130

Clouded Judgement

JULY 28, 2023

AI = Data + Compute I’ll continue beating this drum, but we got two great quotes from Azure and AWS this week. Satya at Microsoft said “Every AI app starts with data and having a comprehensive data and analytics platform is more important than ever.” Revenue multiples are a shorthand valuation framework.

Cloud 130

Cloud Azure AWS GCP(Google Cloud Platform) 130