BREAKING: AWS revenue up 40% YoY

Investment Analysis Clubs Saul’s Investing Discussions
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Amazon earnings beat expectations, and AWS revenue grew 40% YoY to an annual run rate of $72B! This is an acceleration compared to the 39% YoY growth rate of the previous quarter.

I remember only a few years ago, when AWS hit $25B in revenue at the end of 2018. So, this cloud division has almost tripled revenue in 3 years, absolutely defying the law of large numbers for business growth.

As a reminder, many of the companies we discuss here have strong partnerships with the cloud hyperscalers, and so far, Azure, GCP and AWS have all knocked it out of the park. Here’s a list of some these companies that I hold:

DataDog
Zscaler
Sentinel One
Crowdstrike
MongoDB
Snowflake

I’ll post again when I have more details on the earnings.

-Ron

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AWS Historical Revenues

2021 - $71 billion
2020 - $45 billion
2019 - $35 billion
2018 - $25 billion
2017 - $17 billion
2016 - $12 billion
2015 - $8 billion
2014 - $4 billion
2013 - $3 billion

My notes on AWS from the Amazon conference call

  • Launched 115 new cloud services last year
  • 26,000 people attended re:Invent conference
  • 26 global regions, 84 availability zones
  • “We don’t see any obstacles to growth, and we keep adding new capacity”

Past Announcements by SaaS Revenue Hyper-growers on AWS partnerships

5-Jan-2022 Datadog - “Datadog announced a global strategic partnership with Amazon Web Services, Inc. (AWS). As part of this collaboration, AWS and Datadog will work together to develop and deliver tighter product alignment in the future. As a trusted AWS Partner, Datadog has earned several AWS Competencies that demonstrate Datadog’s high level of specialization”

19-Feb-2021 Zscaler - “Your Apps moved to AWS. So why are your users still on the network? Zscaler Private Access (ZPA) for AWS is a cloud service from Zscaler that provides zero-trust, secure remote access to internal applications running on AWS.”

13-Oct-2021 Sentinel One - “SentinelOne, an autonomous cybersecurity platform company, today announced that the company has achieved Amazon Web Services (AWS) Security Competency status. The designation recognizes SentinelOne’s deep technical expertise and proven customer success protecting user endpoints and securing cloud adoption. As an AWS Partner, SentinelOne is committed to working closely with AWS customers to secure their cloud estates from the evolving threat landscape.”

16-Mar-2020 Monday.com - “monday.com, a leading work OS, announced today it has achieved Advanced Technology Partner status in the Amazon Web Services (AWS) Partner Network (APN) and joined the APN Global Startup Program. With monday.com, over 100,000 organizations spanning across 200 business verticals are empowered to build custom workflow apps in minutes, to work the way they want. In managing the monday.com application servers and infrastructure on AWS, monday.com can assure a high level of resilience, scale, and agility to its customers.”

14-Jul-2021 MongoDB - “MongoDB Atlas is a global cloud database service for modern applications, and the best way to run MongoDB on AWS. MongoDB Atlas on AWS lets you build applications that are highly available, performant at global scale, and compliant with the most demanding security and privacy standards. When you use MongoDB Atlas on AWS, you can focus on driving innovation and business value, instead of managing infrastructure.”

9-Apr-2021 Crowdstrike - “Crowdstrike expects its partnership with cloud computing giant Amazon Web Services to help it triple the company’s recurring revenue over the next four years.”

30-Nov-2021 Crowdstrike - "At AWS re:Invent 2021, we are announcing expansions to our strategic partnership with AWS to provide breach protection and control for edge computing workloads running on cloud and customer-managed infrastructure, providing simplified infrastructure management and security consolidation, without impact to productivity. "

-Ron (long AMZN since 2013)
Follow the business, not the short-term wiggles on the price chart. Most of the money is made in the sitting still and waiting.

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Ron,
Thanks for posting all of this. It’s important to see what’s going on right now with these companies as we are given the opportunity, if we see it that way, to buy these companies at much lower prices then they were two months ago.
I actually sold 50% of my AMZN in November after holding the stock since 2003. For me it was time to spread that money into other names. Since first week in Dec I’ve made over 180 adds into about 12 names. From AAPL and AMD to ZI and ZS, all the same names we see here on Sauls board, along with NVDA and MRVL. I’ve been cut seemingly 1000 times even though I’ve only bought on big down days, so really now only about 28% from my ATH.

Seeing the continued great earnings from these names, and tonight as well SNAP and PINS, last week NOW, I just don’t see how the DDOG’s, Snow’s and MNDY’s aren’t going to blow the doors off.

This sell off was much needed, it resets everything to more reasonable levels to build from, but like all major sell offs, they just go too far.

I’ll probably be holding the rest of my AMZN for another decade. Or at least until the cloud is completely built out. I think we have a good 5 years plus to go.

Great to see, and I really think Saul and the rest of us are going to be very well rewarded when the market realizes that these companies once again are very good buys right here.

TMB

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AWS Historical Revenues

2021 - $71 billion
2020 - $45 billion
2019 - $35 billion
2018 - $25 billion
2017 - $17 billion
2016 - $12 billion
2015 - $8 billion
2014 - $4 billion
2013 - $3 billion

I only checked the 3 more recent years. The figure for 2021 seems to be the run rate of AWS revenue (Q4 revenue times 4).

2021 AWS Rev was $62.2B
2020 AWS Rev was $45.4B
2019 AWS Rev was $35.0B

GauchoRico

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The figure for 2021 seems to be the run rate of AWS revenue (Q4 revenue times 4).

Yes, $71B was the Q4 annualized run rate, and full year 2021 was $62B, thanks for pointing that out.

Also, there was some good commentary on AWS by Jamin Ball on Twitter today.

Five years ago, in 2017, analysts were modeling AWS growth at only 20% to 25% CAGR through 2020. Here we are in 2021, and they grew 40%!

Ball says (bolding is mine):
"These kinds of assumptions [40% growth beyond 2020] would have been laughed at if made in 2017. In reality, it wasn’t that long ago! And AWS wasn’t small then - it did $12B of revenue in 2016.

For best in breed cloud software you can’t model future growth with linearly decelerating growth assumptions.

There are definitely cloud software companies today whose growth assumptions through 2027 are laughably too low. "

https://twitter.com/jaminball/status/1489673211461574657

Yep, and we own some of the best of them :slight_smile:

-Ron

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