NEWS DEALS &WINS

Aws Q1 Reflects Customer Caution And Layoffs

“Customers continue to evaluate ways to optimize cloud spending in response to these tough economic conditions,” Olsavsky said. “We are seeing these optimizations continue into Q2.”

Operating income was impacted by 9,000 employee layoffs, with estimated $470m severance charges in Q1 for the parent company, including $270m for AWS.

Amazon’s Q1 sales for its AWS segment rose 16 percent year-on-year to $21.4bn.

Q1 operating income was $5.1bn, down from $6.5bn in Q1 22. This drop was despite new AWS customer investments and migrations, including Southwest Airlines, Zurich Insurance Group , BBVA , Snowflake ,

Stripe and TELUS . CEO Andy Jassy and CFO Brian Olsavsky put the decline down to optimizations from existing AWS customers.

IBM rethinks AI with IBM watsonx

At its annual Think conference, IBM has announced IBM watsonx, an AI and data platform enabling enterprises to scale and accelerate the impact of advanced AI with trusted data.

IBM watsonx offers an AI development studio with access to IBM-curated and trained foundation models and open-source models, access to a data store to gather and cleanse training and tuning data, plus a toolkit for AI governance to provide a seamless end-toend AI workflow for AI that’s adaptable and scalable.

The new IBM collabo- ration with AI company Hugging Face will also work to bring the best of open-source AI models to enterprises on the watsonx platform.

Clients will access the toolset, technology, infrastructure and consulting expertise to build or finetune and adapt available AI models. IBM watsonx.ai, a next generation enterprise studio, will help AI builders to train, test, tune and deploy traditional ML and new generative AI capabilities through an open user interface.

The studio includes a foundation model library, with IBM-curated and trained foundation models, including categories such as fm.code, fm.NLP and fm.geospatial.

Also at Think 2023, IBM

Jassy said: “We continue to prioritize building long-term customer relationships by helping customers save money and enabling them to leverage large language models and generative AI. We like the fundamentals we’re seeing in AWS and believe there’s much growth ahead.” announced a new GPU offering on IBM Cloud, an IBM Consulting Center of Excellence for Generative AI and an IBM Cloud Carbon Calculator to drive AI adoption.

Arvind Krishna, IBM chairman and CEO, said: “Foundation models make deploying AI significantly more scalable, affordable and efficient. We built IBM watsonx for the needs of enterprises, so that clients can be more than just users, they can become AI advantaged. With IBM watsonx, clients can quickly train and deploy custom AI capabilities while retaining full control of their data.”

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Oracle ’s Q4 has beaten revenue estimates following demand for its cloud offerings, said to be driven by increasing AI investment and what Oracle chair and CTO Larry Ellison claims are “dramatic cost savings” over other vendors.

Q4 total revenue was $13.8bn, up 17 percent year-on-year, beating the $13.74bn estimates and bringing the fiscal year up 18 percent YoY to $50bn.

Cloud revenue for Q4 rose 54 percent, reaching $4.4bn. Cloud Infrastructure (IaaS) revenue was up 76 percent to $1.4bn.

Oracle’s SaaS offerings, Cloud Application, Fusion Cloud ERP and NetSuite Cloud ERP jumped 45 percent, 26 percent and 22 percent respectively; $3bn, $0.7bn, $0.7bn YoY.

Up 23 percent in Q4, cloud services and license support revenues totaled

$9.4bn, up 17 percent to $35.3bn for the full fiscal year.

Cloud license and on-premise license revenues fell 15 percent to $2.2bn, also falling two percent for the full fiscal year to $5.8bn.

Ellison said: “It cost us one-tenth to implement Fusion ERP versus SAP’s new ERP system with HANA. The cost of implementing our applications are dramatically lower than our competitors. We have a lot of people moving from AWS to our cloud for infrastructure services [and] from SAP to Fusion. That’s why we’re doing better, and they’re not doing quite as well.”

Safra Catz, Oracle CEO said: “Another fantastic quarter and the end of a great year. While competitors have seen growth rates drop, our cloud infrastructure growth rate has essentially doubled.”

Salesforce Q1 Beats Guidance With Steadied Growth

Salesforce has beaten revenue guidance for its first quarter fiscal 2024 with steadied growth and higher capital costs, causing shares to drop seven percent after hours.

Total Q1 revenue was $8.25bn, an increase of 11 percent YoY, exceeding the $8.18bn expected by analysts.

ARR grew above 50 percent for eight of Salesforce’s industry clouds, while sales performance management, sales productivity and digital service product segments all delivered ARR above 40 percent.

Subscription and support revenues were $7.64bn, an increase of 11 percent YoY, while professional services and other revenues were $0.61bn, an increase of nine percent YoY.

Total growth was the slowest in over a decade, due to longer deal cycles and deal compression prompted in part by the uncertain macro environment. Capital expenditure rose for Q1 totaling $243m, a 36 percent increase compared to the previous period, due to Salesforce’s investment in Einstein GPT.

The company estimated Q2 revenue to be in the range of $8.51bn-$8.53bn, a growth of approximately ten percent, topping analyst estimates of $8.49bn.

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