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Amazon's (AMZN) AWS Picked by NTT DOCOMO, Boosts Clientele

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Amazon (AMZN - Free Report) continues to ride on its robust cloud computing arm — Amazon Web Services (“AWS”). Strengthening AWS offerings, which are constantly driving the company’s cloud customer momentum, have been acting as the company’s key catalyst.

Amazon has gained 91.8% over a year, outperforming the S&P 500 index’s rally of 29.4%.

NTT DOCOMO’s (DOCOMO) latest selection of AWS is a testament to the aforesaid fact, and highlights the efficiency and reliability of AWS's innovative cloud products and services.

DOCOMO intends to leverage AWS’s robust infrastructure and cloud services to deploy its nationwide 5G Open Radio Access Network (RAN) in Japan.

In a bid to simplify network operation with automated cluster management tools, DOCOMO plans to integrate Amazon Elastic Kubernetes Service Anywhere (Amazon EKS Anywhere) into its 5G Open RAN. This, in turn, will enable seamless integration with other AWS services in AWS Regions.

Moreover, DOCOMO is developing its 5G Core on AWS, for which it has already started proofs-of-concept using AWS Graviton Processors and Amazon EKS. This will help the company in running its cloud-native 5G Core software in a hybrid cloud environment.

Amazon.com, Inc. Price and Consensus

 

Amazon.com, Inc. Price and Consensus

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

Expanding Customer Base

DOCOMO’s latest move has added strength to AWS’s customer base.

Owkin recently selected AWS as the primary cloud provider. The latter intends to develop generative AI applications, and accelerate drug discovery and clinical trials with the help of AWS’s scalable storage options, enhanced data security measures and strong computing capabilities.

Choice Hotels International (CHH - Free Report) went all-in on AWS. It closed its last data center and shifted its entire system infrastructure to AWS. Choice Hotels strives to update its hotel-facing operations and management tools seamlessly in order to enable its franchisees to have up-to-the-minute access to the latest innovations.

We believe that AWS’s expanding customer base will continue to drive its top-line growth. In fourth-quarter 2023, AWS generated revenues of $24.2 billion (14% of the total sales), which grew 13% year over year.

The strengthening performance of AWS, which has become an integral part of Amazon, will likely instill investor optimism in the stock in the days ahead.

To Conclude

We believe that AWS’s growing global clientele, on the back of its expanding portfolio, as well as data centers and cloud regions, will continue to help the company gain a competitive edge against its peers, namely Microsoft (MSFT - Free Report) and Alphabet’s (GOOGL - Free Report) Google.

Amazon, currently sporting a Zacks Rank #1 (Strong Buy), accounted for 31% of the worldwide cloud provider market in fourth-quarter 2023, per the latest Synergy Research Group data. You can see the complete list of today's Zacks #1 Rank stocks here.

Microsoft, which accounted for 24% of the market, is riding on solid momentum across its Intelligent Cloud business that reported $25.9 billion in revenues (41.7% of the total revenues), up 20% year over year in second-quarter fiscal 2024. The company is riding on the robust adoption of Azure, driven by strength in Azure AI. The Azure and other cloud service revenues grew 30% year over year.

Google Cloud is contributing substantial growth to Alphabet's total revenues. Expanding data centers, availability zones and cloud regions are expected to keep boosting Alphabet's cloud position. Alphabet’s Google Cloud acquired 11% of the market, and reported revenues of $9.19 billion (10.6% of the total revenues), up 25.7% year over year in fourth-quarter 2023.

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