Microsoft vs Google: Whose cloud grew faster in latest quarter head-to-head?

We break out the top takeaways from the tech giants’ latest financials

Google Cloud grew faster than Microsoft Cloud in the vendors' latest quarter head-to-head.

Google Cloud revenue was up 43.8 per cent year on year to $5.82bn in parent company Alphabet's Q1, while Microsoft Cloud revenuewas up 32 per cent year on year to $23.4bn in Microsoft's Q3.

Here we break out the key takeaways from both companies' financials.

Google Cloud - a standout quarter for growth but still losing money

Google's cloud business was a standout unit in Alphabet's Q1 as enterprise clients continued to shift workloads away from their own datacentres.

In an earnings call webcast, CEO of parent company Alphabet, Sundar Pichai, said the company is investing in Google Cloud Platform (GCP) in four areas: cybersecurity; virtual machine threat detection; new data lake/"data cloud" offerings including "serverless Spark" and BigLake, a new storage engine that unifies data warehouses and lakes; and Dataplex, which provides unified management and governance of data.

"Q1 saw strong growth in Search and Cloud, in particular, which are both helping people and businesses as the digital transformation continues," he said.

"We'll keep investing in great products and services, and creating opportunities for partners and local communities around the world."

However, the company's financial report reveals that Google Cloud is still losing money.

The cloud division reported an operating loss of $931m, although that was a smaller loss to $974m in Q1 FY2021.

And its parent company disappointed Wall Street investors failing to hit profit estimates.

Alphabet logged an eight percent decline in quarterly profit, which the company blamed on slowing growth for YouTube advertising and search as well as a decline in the value of its investments.

Alphabet shares fell 4.8per cent immediately following the news.

Revenues were $68.01bn for the quarter.

Microsoft Cloud - Azure cloud services demand rises

Microsoft beat expectations on both its top and bottom lines.

Revenue rose 18 per cent year-on-year to $49.4bn in its Q3 FY2022, beating Wall Street's expectations of $49bn, and sending Microsoft shares surging six per cent in extended trading on Tuesday.

Meanwhile, net income for the quarter was $16.7bn.

Focusing on Microsoft Cloud, while the 32 per cent growth rate was less than Google Cloud's 43.8 per cent, Microsoft Cloud continues to be a bigger business than GCP.

Microsoft Cloud revenues surpassed $23bn for the quarter (vs $5.82bn for GCP).

Within that business segment, Azure and other cloud services logged revenue growth of 46 per cent.

Microsoft CEO Satya Nadella hailed the company's strong growth in cloud-services demand, telling analysts on an earnings call that the number of Azure deals worth at least $100m in the quarter also more than doubled.

"With Azure, we're building a distributed computing fabric across the cloud and the edge to help every organisation build, run and manage mission-critical workloads anywhere.

"This quarter, we helped more customers than ever, simplifying and accelerating their cloud migrations. And it's still early days," he said.

Microsoft CFO Amy Hood added: "Continued customer commitment to our cloud platform and strong sales execution drove better than expected commercial bookings growth."