Tom Tunguz

FEBRUARY 1, 2024

Calendar Quarter Azure OpenAI Orgs, k CoPilot Users, m Power Platform Orgs, k 1/1/24 53 1.3 “In Azure, we expect Q3 revenue growth in constant currency to remain stable to our stronger-than-expected Q2 results.” Many companies are moving in this direction. 230 10/1/23 18 1 126 7/1/23 11 63 4/1/23 2.5

AI 200

AI Azure Artificial Intelligence Generative AI 200

Clouded Judgement

FEBRUARY 2, 2024

” Microsoft on Azure : “And I think last quarter, we said one, we are going to continue to have these cycles where people will build new workloads. They also are seeing AI revenue (largely compute) show up sooner than anyone else. Revenue multiples are a shorthand valuation framework. Top 5 Median: 17.2x

Cost optimization & reporting 161

Cost optimization & reporting Cloud Azure AWS 161

Clouded Judgement

MAY 3, 2024

We now have results from the three hypersclaers (AWS / Azure / GCP). Quarterly Reports Summary Top 10 EV / NTM Revenue Multiples Top 10 Weekly Share Price Movement Update on Multiples SaaS businesses are generally valued on a multiple of their revenue - in most cases the projected revenue for the next 12 months.

Cost optimization & reporting 183

Cost optimization & reporting Cloud Software Azure 183

SaaStr

DECEMBER 28, 2023

And broader Cloud players had great years too, from MongoDB to Cloudflare to Azure, if not quite as crazy as at the peak of 2021. But then in 2023 — it just plummeted.

Azure 293

Azure Cloud SaaS Trends 293

Tom Tunguz

JULY 25, 2023

Both Google & Microsoft announced growth rates in GCP & Azure that held steady from one quarter to the next. Microsoft’s Azure Open AI customer base grew 4x by count, up from 2500 last quarter : We have great momentum across Azure OpenAI Service. The desire for AI is broad. The acceleration is really quite broad.

Azure 203

Azure GCP(Google Cloud Platform) AI Cloud 203

Tom Tunguz

JANUARY 23, 2023

We saw moderated consumption growth in Azure and lower-than-expected growth [elsewhere]. Segment Expected Growth Productivity 12% Office Commercial 6% Office On-Premise -25% LinkedIn 5% Dynamics 13% Intelligent Cloud 18% Azure 26% Server -3% Services -3% 2. At some point, the optimizations will end.

Azure 245

Azure Underperforming Technical Team Machine Learning Artificial Intelligence 245

SaaStr

JANUARY 27, 2024

Typically support consumes about perhaps 5%-7% of your revenue at scale (excluding customer success) in most SaaS models. Another 5%-7% go to core infrastructure costs (AWS, Azure, Snowflake, etc). Dear SaaStr: What is The Average Ratio of Support Staff to Customer Count in SaaS?

Azure 213

Azure AWS SaaS Customer Success 213

Clouded Judgement

APRIL 11, 2024

It looks at the YoY dollar change in quarterly revenue from the hyperscalers (just looking at Azure / AWS because the data goes back further) going back a few years. If we break this down and look at Azure and AWS independently (graphs below), you’ll see how the AWS “swings” were a lot more volatile.

Cloud 177

Cloud Software Azure AWS 177

Tom Tunguz

OCTOBER 27, 2022

Microsoft Azure. Infrastructure revenue growth averaged 33% this quarter, which is astounding considering we’re talking about businesses that sum to more than $50b of revenue per quarter. At a 7x multiple of revenue, that is another $84b of market cap creation, in theory. Google Cloud Platform. Amazon Web Services.

Cloud 228

Cloud GCP(Google Cloud Platform) Azure AWS 228

Tom Tunguz

JULY 26, 2022

Microsoft Azure. Microsoft Azure grew 40% y/y, tying the fastest quarterly growth rate in the past 5 quarters. Google’s growth rate fell to 35%, a 29% decline from the trailing 4 quarter average of 49% annual revenue growth. Here are some hypotheses: Google may have greater customer concentration in GCP than Azure.

GCP(Google Cloud Platform) 192

GCP(Google Cloud Platform) Cloud Azure AWS 192

SaaStr

MAY 16, 2022

So follow AWS, Azure and Google Cloud. Let’s look a whole level up to the real canaries-in-the-coalmine: AWS, Azure and Google Cloud. And AWS grew 37% at a $74B run-rate , down a bit from 39% the prior quarter but still adding an insane amount of new revenue. If they stumble, we’re in for a rough patch. They are the Cloud.

Cloud 241

Cloud Azure AWS Engineering 241

Chart Mogul

JANUARY 20, 2022

Configure Amazon S3, Google Cloud Storage, or Azure Blob Storage as a destination in ChartMogul and export your activities for further analysis. ChartMogul is only one part of a larger ecosystem of tools an organization with recurring revenue uses. Combining revenue, product, CRM, and other data sets uncovers powerful insights.

Azure 52

Azure Cloud Forecasting Churn 52

Tom Tunguz

FEBRUARY 2, 2023

A year ago, AWS, GCP, & Azure averaged 44% annual growth. So far in the first month of the year, AWS year-over-year revenue growth is in the mid-teens. in revenue, GCP is at -7%, not far off breakeven, but a long way from AWS’ 30% profit margins. Today, that figure has dropped to 27%. Amazon: Net sales increased $21.4

GCP(Google Cloud Platform) 289

GCP(Google Cloud Platform) Cloud AWS Sales Hiring 289

Clouded Judgement

APRIL 28, 2023

AWS (Amazon), Azure (Microsoft), and Google Cloud (Google) all reported this week. Azure reported on Tuesday and gave us that glimmer of hope. Azure : Coming into the quarter, a growth rate that would have satisfied the market would have been ~29%. Azure came in at 31% (constant currency). Follow along to stay up to date!

Cloud 130

Cloud Azure AWS AI Search 130

Tom Tunguz

MAY 31, 2022

Amazon Web Services and Azure, the business units inside Amazon and Microsoft serve and sell to small, medium, and large companies in every major geography. Microsoft Azure. Here are the revenue growth rates for these businesses broken out by software and infrastructure. Fortunately, it exists. So do Salesforce. ServiceNow.

Azure 201

Azure Software Startup Cloud 201

SaaStr

JANUARY 25, 2023

. “[We’re] not fighting those headwinds”: Given that customers sign 3+ year, $1m+ contracts, one wouldn’t expect any massive decline in revenue from any shorter-term macro effects anyway. 20,000 employees, so about $350,000 revenue per employee. But new bookings aren’t really down, either. to $4m ACV. #4.

Azure 249

Azure Cloud Enterprise Subscription 249

Tom Tunguz

NOVEMBER 28, 2023

“Q3 product revenue grew 34% year-over-year to reach $698 million. “Yes, we actually saw quite a bit of energy coming from the Azure platform this quarter. Non-GAAP adjusted free cash flow was $111 million, representing 7% year-over-year growth. Results reflect strong execution in a broadly stabilizing macro environment.

GCP(Google Cloud Platform) 143

GCP(Google Cloud Platform) Azure Data Startup 143

Clouded Judgement

JANUARY 6, 2023

Cloud Downgrades This week UBS came out with a couple research reports citing concerns in AWS / Azure growth. This brings me back to AWS / Azure downgrades. This was the worst tone that we’ve heard in years from large AWS/Azure partners, a group that usually expresses different shades of optimism about AWS/Azure growth.”

Cloud 130

Cloud Azure AWS Underperforming Technical Team 130

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. Revenue multiples are a shorthand valuation framework. Overall Stats: Overall Median: 5.7x

Cloud 161

Cloud Software GCP(Google Cloud Platform) Azure 161

Clouded Judgement

OCTOBER 20, 2023

Hyperscaler Preview Next week Amazon, Microsoft and Google report earnings and we’ll see Q3 data for AWS, Azure and Google Cloud. Office 365 Copilot, for example, doesn’t go live until November and we most likely won’t see meaningful revenue from it until next year. Overall Stats: Overall Median: 5.7x

Cloud 161

Cloud Azure AWS Software Review 161

SaaStr

DECEMBER 27, 2023

Many have used Digital Ocean at the cheaper, simpler version of AWS-Azure-Digital Ocean to get going fast and quickly. But it’s raining cash, and earnings per share is growing 22% — faster than revenue. And if so, maybe that’s Digital Ocean. If you haven’t heard of Digital Ocean, ask your developer.

Scale 220

Scale AWS Azure Cloud 220

Clouded Judgement

AUGUST 4, 2023

You can see more detail about their net new ARR added each quarter below Azure Growth came in at 27%, and guided to 25-26% growth for Q3. Revenue multiples are a shorthand valuation framework. Multiples shown below are calculated by taking the Enterprise Value (market cap + debt - cash) / NTM revenue. Top 5 Median: 16.1x

Cloud 130

Cloud Azure Cost optimization & reporting AWS 130

Tom Tunguz

SEPTEMBER 26, 2022

Look no further than the massive companies pushing the public & the private market forward: Snowflake, Databricks, Amazon, Azure, Google Cloud. Cloud databases generated $39b in spend , about half of all database revenue. On October 25th, I’ll share my 10 predictions for data in 2023 at The Impact Data Summit.

Data 241

Data Azure Machine Learning Artificial Intelligence 241

SaaStr

FEBRUARY 20, 2021

But are AWS, Azure and Google Cloud just too big for us to learn from? Google Cloud sees Cloud revenues tripling in the next 5 years. Google Cloud continues its march upmarket, competing with Azure. You can see that here vividly, with Google Cloud having a $30B backlog of signed revenue on top of its $13B in ARR.

Cloud 208

Cloud Azure AWS Scale 208

Clouded Judgement

OCTOBER 28, 2022

Hyperscalers Report Quarterly Earnings This week we saw AWS (Amazon), GCP (Google) and Azure (Microsoft) report earnings. At the same time, Azure came in below expectations. Azure called out an incremental $800m of costs expected throughout the year (they just finished their Fiscal Q1). Overall Stats: Overall Median: 5.2x

Cloud 130

Cloud Azure AWS Cost optimization & reporting 130

SaaStr

MARCH 9, 2022

Focusing on smaller developers, in some ways it’s been a bit overshadowed by AWS, Azure, and Google Cloud. DigitialOcean doesn’t want to take AWS, Azure and Google on in the enterprise and doesn’t really try. They are only 15% of the customers, but 83% of the revenue. Only 38% of revenue in North America.

Azure 205

Azure AWS SMB Cloud 205

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. This week we had two of the hypserscalers report (Microsoft / Azure and Google / GCP), and everyone was eager to see their results. The bars represent the YoY revenue growth, and the yellow line is the stock price.

Cloud 130

Cloud Azure AWS GCP(Google Cloud Platform) 130

Clouded Judgement

JUNE 9, 2023

Expansion revenue is still declining (we see this in falling net retention rates), but gross retention remains strong. Usage on Snowflake is driven by queries run on Snowflake Azure: Neutral Tone With Strength in AI Overall I’d characterize Azure’s quarter as a net positive. Overall Stats: Overall Median: 5.7x

Trends 130

Trends Cloud Azure AWS 130

Clouded Judgement

JANUARY 27, 2023

Azure (Microsoft) Quarter The week the first of the cloud giants reported - Azure. Early Look at 2023 Guides Given the Azure weakness reported on Tuesday, all software tumbled Wednesday morning with most names down 5-10%. Revenue multiples are a shorthand valuation framework. Follow along to stay up to date!

Cloud 141

Cloud Azure Pricing Subscription 141

Tom Tunguz

FEBRUARY 13, 2023

Large customer revenue contribution increased again sequentially to 63% of revenue, up from 57% in the fourth quarter last year. For fiscal 2022, large customers represented 61% of total revenue compared to 54% of total revenue in 2021 and 46% in 2020… Overall NDR fell, but enterprise spending remains steady.

Cloud 231

Cloud Azure Headcount Software Review 231

SaaStr

NOVEMBER 3, 2022

Which means better customer relationships, more data, and new sources of revenue. Secureframe allows companies to get compliant within weeks, rather than months and monitors 100+ services, including AWS, GCP, and Azure. StratusGreen is a leading provider of cloud computing solutions and services for emerging and mid-sized businesses.

Payments 216

Payments Payment Services GCP(Google Cloud Platform) Payment Solutions 216

Clouded Judgement

APRIL 21, 2023

Next week we get all 3 hyperscalers reporting (AWS from Amazon, Azure from Microsoft, and GCP from Google). Let’s double click on Azure. Revenue multiples are a shorthand valuation framework. Multiples shown below are calculated by taking the Enterprise Value (market cap + debt - cash) / NTM revenue.

Cloud 130

Cloud Azure AWS GCP(Google Cloud Platform) 130

SaaStr

MAY 6, 2022

Ultimately — revenue multiples. Revenue multiples are how much VCs, investors, and ultimately, an IPO and public markets will value each dollar of revenue. Revenue multiples don’t affect customers, or even revenue itself. That revenue multiples should rise from where they were in 2019.

SaaS 328

SaaS Azure Cloud AWS 328

SaaStr

OCTOBER 13, 2022

You need an efficient way to keep your customers successful, reduce churn, drive adoption, and increase net revenue retention. Secureframe allows companies to get compliant within weeks, rather than months and monitors 100+ services, including AWS, GCP, and Azure.

GCP(Google Cloud Platform) 185

GCP(Google Cloud Platform) Azure AWS Enterprise readiness 185

IT World

JANUARY 25, 2023

The Windows-maker reported 29% growth in total cloud revenue to $21.5 Microsoft said it expects its third quarter cloud gross margin to decrease by one percentage point, driven by Azure. billion for the second quarter of fiscal year 2023, slowing from Q1, 2023 where the company posted 31% growth for the segment.

Cloud 96

Cloud Azure AI Enterprise 96

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 The hyperscalers (AWS, Azure, GCP) are seeing some uptick, but this is largely from selling compute (ie cloud GPUs).

Cloud 130

Cloud Trends Azure GCP(Google Cloud Platform) 130

Tom Tunguz

JUNE 9, 2018

Microsoft has published Linux and FreeBSD for Azure. To migrate enterprise on-prem code to Azure is a huge competitive advantage. Mix the two, chill, and shake, and you have a new billion dollar revenue business unit for Microsoft. Elegant on-ramp for a developer to become a paying Azure customer. M &A Intelligence.

Acquisition 200

Acquisition Azure Cloud Enterprise 200