"Just a few years ago, cloud computing was one of the hottest tech trends as companies shifted their attention to software and services that they and their customers could access anywhere. As a result, Amazon and other competitors built massive data centers to meet all of the demand, with Amazon leading the pack and Microsoft and Alphabet's Google following behind."
"Fast forward to today, and cloud computing is still a must-have for many companies, and Amazon Web Services Amazon Web Services (AWS) still leads the pack. What's more, artificial intelligence is spurring a massive uptick in data center spending -- Nvidia's CEO thinks up to $4 trillion will be spent over the next five years -- to process complex AI systems."
Amazon holds dominant positions across e-commerce, advertising, and cloud computing, providing exposure to multiple large secular opportunities. AWS remains the cloud leader and stands to benefit from AI-driven data-center investment, with Goldman Sachs projecting global AI cloud sales could reach $2 trillion by 2030. AWS's operating margins around 37% make incremental cloud revenue especially lucrative. AI workloads are prompting significant data-center spending forecasts, including Nvidia's CEO estimating up to $4 trillion over five years. Amazon's advertising business evolved from an afterthought and only began reporting ad sales in 2022, adding another growth vector.
Read at The Motley Fool
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