Amazon stock plummets amid cloud slowdown

Amazon reported that its cloud growth has slowed, as business customers reduce spending amid market uncertainty. The retail giant reported that profits will rise 9% from last year, but warnings of slowdown in their cloud services have caused company stock to dip. The stock value rose $125 billion after positive announcements on consumer sentiment, before plummeting mere minutes later following a statement by CFO Brian Olsavsky. Olsavsky stated that cloud customers were looking to cut their spending due to current economic conditions. However, he added that inflation is decreasing worldwide and that consumer confidence is on the rise. While CEO, Andy Jassy, has made cuts and reduced spending in various divisions in the company, he recently stated that he saw opportunity for growth and development in Amazon’s AI tools and cloud services. Amazon Web Services (AWS) sales growth has slowed in the first quarter of the year, but is currently in a race against Google and Microsoft to develop a competitive AI suite. “Despite economic uncertainty, the cloud market remains fundamentally strong, serving as the backbone for business operations and growth. With organisations looking to reduce overheads in anticipation of further challenges ahead, the elephant in the room is cost optimisation,” says James Campanini, CEO of tech consultancy firm VeUP, commenting on the challenges facing the cloud market. Campanini continues: “The truth is that many companies lack the resources and expertise to optimise their spend in this area. Many also see cost optimisation as an afterthought, and do not include it in the design phase. Addressing this issue requires businesses to work with dedicated cloud partners who can enable them to realign, access a broader array of services and operate more efficiently to get the most out of cloud and their cloud provider.”