Report: Cloud revenue growth far exceeds on-premises
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Battery Ventures State of the OpenCloud 2022 report looks at the context of cloud infrastructure and open source software and provides best practices for cloud companies.
The giant in the sky likes Amazon Web Services (AWS), Microsoft Azure and Google Cloud have demonstrated remarkable growth sustainability — and profitability — at scale, despite the current macroeconomic environment. Billion dollar businesses like Databricks (a battery portfolio company) and Snowflakes is built on top of these giant cloud providers and has plenty of room to grow, as digital transformation accelerates across industries and more workloads move to the cloud.
Heavy cloud growth
Across the four major software-infrastructure companies (MongoDB, Confluent, Elastic, and Splunk), the cloud revenue CAGR was at least 72% and at most 200% from 2018 to 2022. By contrast. , the local CAGR ranges from 4% to 55%.
Overall, Battery predicts that cloud spending will now account for about 25% of the $919 billion in enterprise IT spend in 2022, a share that is certain to increase in the coming months and years due to the ability to market disruption. Against the backdrop of growing pressure to improve productivity and efficiency and a high inflation environment, Battery predicts we will see a gradual increase in cloud adoption across every industry and platform. economy.
“Many cloud companies are showing strong growth and even profitability as the broader IT market remains untouched by cloud computing; There’s still a lot of room for growth,” said Danel Dayan, vice president of Battery and one of the report’s authors.
“While it remains to be seen what will happen in the next few months in the tech industry, given the market downturn, we are confident that the cloud and open source software will soon transform industries in the ways that we see it. in a way we’ve never seen before. ‘ added Dayan.
Battery Ventures 2022’s OpenCloud report is based on publicly available data from Gartner, Pitchbook, US Bureau of Labor Statistics, CapIQ, and corporate earnings reports. (Battery investments and exits are listed this.)
Read Full report from Battery Ventures.
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