In the battle to tap the next growth driver for the cloud business, Microsoft has focused on its core business clients that already use many of its software services, while Google has turned to startups.
The results show cloud spending is coming from enterprise clients, whereas smaller businesses are reducing their expenditure, he said.
Strong AI use was responsible for a 3 percentage point boost to the Microsoft's cloud business in the September quarter.
"Unlike many others who are touting their AI story, Microsoft is capable of delivering meaningful AI products to their customers," brokerage D.A.
Many analysts were also optimistic about strength in Alphabet's core search business, but they warned the weakness in the cloud business would continue.
Persons:
Morningstar, Ali Mogharabi, Krishna Chintalapalli, Satya Nadella, Davidson, Bernstein, Sundar Pichai, Aditya Soni, Akash Sriram, Arun Koyyur
Organizations:
Microsoft, Google, Parnassus Investments, Fortune, Thomson
Locations:
Bengaluru