AWS' growth slows to 28 per cent as customers look to control cloud costs
"With the ongoing macroeconomic uncertainties, we've seen an uptick in AWS customers focused on controlling costs," Amazon CFO Brian Olsavsky said
Amazon Web Services' annual growth rate slowed again in its latest quarter as the public cloud giant saw an uptick in customers focused on controlling costs.
In Amazon's Q3 2022 ended 30 September, AWS' growth slowed to 28 per cent, with Amazon CFO Brian Olsavsky admitting that growth had fallen to the mid-20s by the end of the quarter.
This compares with the 37 and 33 per cent year-on-year growth it logged in Q1 and Q2, respectively.
Recently turning 20, AWS has risen rapidly to become a top ten vendor in the UK channel. Some partner bosses CRN spoke to in July felt the public cloud market leader's channel strategy has room for improvement, however.
The cloudy business generated $20.5bn of Amazon's $127.1bn Q3 revenues and now boasts an annual runrate of $82bn.
Amazon's share price fell by around 12 per cent on the results as its weak sales forecast for the upcoming holiday season left investors cold.
Analyst ISG this month warned that customers are "hitting the brakes" on cloud-based projects, and Olsavsky admitted that macroeconomic uncertainties have prompted more AWS customers to control costs.
"And we're proactively working to help customers cost optimise, just as we've done throughout AWS' history, especially in periods of economic uncertainty," he said on a Q3 earnings call.
"The breadth and depth of our service offerings enable us to help them do things like move storage to lower-priced tiers options and shift workloads to our Graviton chips."
Ultimately, the recession could prove a plus point for cloud computing when compared with less flexible consumption models, Olsavsky argued, however.
"When I talk about enterprise customers in AWS, yes, we've been working with customers to lower their bills. Just like all companies, they want to lower their spend when they're faced with uncertainty in the market," he said.
"I would say one that's real valuable points about cloud computing is that it's turning fixed cost into variable for many of our customers, and we help them save money either through alternative services or Graviton3 chips. There's many ways that we have to help them lower their spending and still get great cost performance ratios."