Source: blogs.barrons.com --- Friday, January 29, 2016
Following robust cloud computing revenue growth from Amazon.com ( AMZN ) and Microsoft ( MSFT ) in the December quarter, reported by both yesterday afternoon, some cloud pundits on the Street have been talking up the positive implications for cloud technology suppliers such as Western Digital ( WDC ) and Rackspace Hosting ( RAX ). Needham & Co .'s Richard Kugele , who follows shares of Western, writes that Amazon's Amazon Web Services "continues to impress with 69% y/y growth in 4Q15 and 28% operating margins." The innovation engine is chugging just as fast as the revenue with 722 new features added during 2015, up 40% y/y. We believe that clouds aiming to compete with the breadth and scale of AWS need to not only provide storage and compute by the glass but also the enterprise grade services that AWS wraps around its vast infrastructure. It is this combination that enabled AWS to offer its 51st price reduction in January (which clearly have not been negatively impacting profitability). His take: Amazon data center expansion bodes well for component suppliers (such as WDC). Although no longer directly competitive to AMZN (and more recently a "frenemy") this type of performance from AWS further distances itself from the likes of RAX and others in the managed hosting space." ...
from Microsoft http://ift.tt/1QMaZZm
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