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Amazon (AMZN) Expands AWS Portfolio Offerings With AppFabric

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Amazon’s (AMZN - Free Report) cloud division, Amazon Web Services (AWS), recently made its no-code service, called AppFabric, generally available to strengthen its services portfolio.

Notably, the new service enables customers to connect and manage various SaaS applications and productivity suites in one location seamlessly, with the support of AWS’ Management Console, information technology and security teams.

Moreover, AppFabric aids in adding new capabilities to SaaS applications and enhances their security by connecting them to tools like Logz.io, Netskope, Netwitness, Rapid7 and Splunk.

It aggregates and normalizes log data from applications and suites such as Asana, Atlassian Jira suite, Dropbox, Google Workspace, Microsoft 365, Miro, Okta, Slack, Smartsheet, Webex by Cisco, Zendesk and Zoom.

This apart, the company also introduced an Amazon Bedrock-powered generative AI feature in AppFabric. With the help of this feature, AppFabric will perform tasks, generate insights and make suggestions by leveraging large language models.

Amazon.com, Inc. Price and Consensus

 

Amazon.com, Inc. Price and Consensus

Amazon.com, Inc. price-consensus-chart | Amazon.com, Inc. Quote

 

Customer Base to Expand

We believe that the underlined service will help AWS gain strong momentum among various businesses as it enables various companies to enhance the security, management and productivity of their applications.

Notably, customers like Bank Leumi, Optibus and YuJa have already shown interest in AppFabric.

We believe that the growing customer momentum will continue to drive AWS's top line.

In first-quarter 2023, AWS generated revenues of $21.3 billion (17% of total sales), which grew 16% year over year.

Bottom Line

We believe that AWS’s strengthening clientele across the world will continue to aid Amazon in gaining a competitive edge against its strong peers like Microsoft (MSFT - Free Report) and Alphabet's (GOOGL - Free Report) Google.

Microsoft Azure has become the key growth driver for Microsoft. The company is currently riding on the robust adoption of Azure cloud offerings. Azure's globally increasing number of availability zones and regions, along with strength in its consumption-based business, is likely to continue driving Microsoft's cloud momentum in the near term.

Similarly, Google Cloud is contributing substantial growth to the total revenues of Alphabet. Expanding data centers, availability zones and cloud regions are expected to keep boosting Alphabet's cloud position.

Nevertheless, AWS’s growing efforts toward strengthening its portfolio offerings are likely to keep it ahead of the above-mentioned peers.

Apart from AWS AppFabric, the company recently made its purpose-built security data lake, called Amazon Security Lake, generally available. The service aids in the simplification of compliance monitoring and security data management across hybrid and multi-cloud environments by centralizing an organization’s security data across AWS environments.

Further, it introduced a new configuration for Amazon Aurora, namely Amazon Aurora I/O-Optimized, which provides improved price performance and predictable pricing for I/O-intensive applications.

It also unveiled three new capabilities for its threat detection service called Amazon GuardDuty - GuardDuty EKS Runtime Monitoring, GuardDuty RDS Protection and GuardDuty Lambda Protection.

Additionally, the company announced the general availability of AWS Telco Network Builder, which automates the deployment and management of telco networks on AWS.

We believe that portfolio strength will continue to drive AWS’ customer momentum, which, in turn, will aid Amazon in sustaining its cloud dominance. This will instill investor optimism in the stock in the days ahead.

Notably, Amazon has gained 52.2% on a year-to-date basis.

Per the latest Canalys report, AWS accounted for 32% of global cloud spending in first-quarter 2023, maintaining its leading position in the booming cloud market.

Microsoft’s Azure, the second-largest cloud-service provider, accounted for 23% of worldwide cloud spending. Alphabet’s Google Cloud represented 8% of cloud spending, marking it the third-largest cloud provider.

Zacks Rank & Stocks to Consider

Currently, Amazon carries a Zacks Rank #3 (Hold).

A better-ranked stock in the broader Zacks Computer & Technology sector is Palo Alto Networks (PANW - Free Report) , sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Palo Alto Networks shares have increased 74.8% in the year-to-date period. The long-term earnings growth rate for PANW is currently projected at 31.5%.

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