Microsoft stock will climb to $300 as the company gains cloud market share, Wedbush says

Microsoft employees

  • Microsoft stock will climb to $300 per share, according to analysts at Wedbush.
  • Analyst Daniel Ives said “recent field checks” have made Wedbush believe Azure is gaining market share in the cloud business.
  • Microsoft saw total revenue growth of 17% year-over-year and cloud revenue growth of 50% year-over-year in its most recent earnings release.
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Microsoft stock will climb to $300 as the company continues to gain cloud market share Wedbush analysts said in a note to clients on Monday.

Wedbush analyst Daniel Ives lifted the firm’s price target for Microsoft to $300 from $285 after “recent field checks” in the industry have led him to believe Microsoft’s Azure cloud business is gaining market share from the competition.

Ives had already raised his price target for the tech giant to $285 from $275 after Microsoft outperformed in its latest earnings report, but recent updates have the analyst seeing even more upside ahead.

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Microsoft beat analyst revenue and earnings estimates for the quarter that ended in December on Jan 26, turning in record quarterly revenue of over $43 billion, up 17% year-over-year, and EPS of $2.03.

Analysts were most excited by the incredible growth of Microsoft’s Azure cloud business. The segment grew revenues by 50% year-over-year versus just 28% year-over-year growth at the company’s major competitor Amazon Web Services.

Now, analysts at Wedbush believe “the tide is shifting in the cloud arms race” and Microsoft is pulling ahead of Amazon’s AWS and others due to its broad installed base of customers.

“We believe Azure’s cloud momentum is still in its early days of playing out within the company’s massive installed base and the Office 365 transition for both consumer/enterprise is providing growth tailwinds over the next few years,” Ives said.

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Wedbush also believes cloud adoption is only going to accelerate in 2021 even after a record year in 2020 due to the pandemic and stay-at-home trends.

“Based on our conversations with CIOs, CISOs, and IT product managers globally over the last month we believe cloud-driven architecture IT growth in 2021 could surpass that of 2020 as more enterprises rip the band-aid off on digital transformations,” Ives said.

The analysts continued, “we believe this disproportionally benefits the cloud stalwart out of Redmond, as Nadella & Co. are so well positioned in its core enterprise backyard to further deploy its Azure/Office 365 as the cloud backbone and artery.”

Growing market share and prime conditions for Azure are probably music to the ears of executives at Microsoft. Especially after former CEO Steve Ballmer said he wished the company had got into cloud services sooner.

“Azure — I wish we probably started a year or so, two years earlier,” Ballmer said in a live stream on Clubhouse. “We started actually with platform as a service instead of infrastructure as a service. Probably we would do that a little bit differently. It cost us a little bit of time in the eventual battle, if you will, with AWS.”

Microsoft traded up slightly in premarket hours on Tuesday at $245.50 per share, implying a potential 22% price increase based on the Wedbush analysts’ predictions.

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Steve Ballmer said on Clubhouse that he wishes Microsoft had taken on Amazon’s cloud business sooner

Steve Ballmer Microsoft
Former Microsoft CEO Steve Ballmer.

  • Former Microsoft CEO Steve Ballmer said he wishes the company invested in cloud-computing earlier.
  • Ballmer made the remarks on Clubhouse, CNBC reported.
  • Microsoft launched its first cloud products in 2008, two years after Amazon.
  • Visit the Business section of Insider for more stories.

Former Microsoft CEO Steve Ballmer said he wishes he had invested in cloud computing earlier in his tenure at the tech giant, CNBC reported. Ballmer made the remark Thursday on Clubhouse, an audio-chat app, during a discussion that also included Sriram Krishnan, a general partner at Andreessen Horowitz, and Steven Sinofsky, a former manager at Microsoft.

“I wish we probably started a year or so, two years earlier,” Ballmer said, according to CNBC’s report. 

Microsoft released its first cloud products in 2008 before debuting Azure, its cloud-computing service, in 2010. By then, Amazon had been selling cloud services for four years.

Amazon Web Services, Amazon’s cloud-computing division, is the leader in the cloud-infrastructure market, earning a 32% share during the fourth quarter of 2020. Microsoft Azure was second, with a 20% share. No other company reached 10%.

Read more: Amazon and Microsoft have the $7 billion-plus federal cloud market so ‘locked up,’ analysts say the real challenge will be standing out from each other

Cloud services have become a larger percentage of Microsoft’s business in recent years. During the company’s 2020 fiscal year, which ran from July 2019 through June 2020, its “intelligent cloud” segment accounted for 34% of the company’s revenue, up from 31% in fiscal 2019 and 29% in fiscal 2018.

Satya Nadella, Microsoft’s current CEO, ran the division at Microsoft that included its cloud business before replacing Ballmer in 2014. Nadella has also said he wished Microsoft had launched its cloud products sooner.

“We knew by looking at what Amazon was doing that we needed to reinvent ourselves,” Nadella said in 2017.

During the Clubhouse discussion, Ballmer said Microsoft was also too slow in its attempt to launch a phone. The company bought Nokia’s devices business in 2014, seven years after Apple released its first iPhone. By 2017, Microsoft said its phone-related revenue was “immaterial.”

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Farfetch plans to pour money into marketing as it takes on Amazon for online luxury shoppers

Good morning and welcome to Insider Advertising for February 2. I’m senior advertising reporter Lauren Johnson, and here’s what’s going on:

If this email was forwarded to you, sign up here for your daily insider’s guide to advertising and media.

Tips, comments, suggestions? Drop me a line at LJohnson@businessinsider.com or on Twitter at @LaurenJohnson.


farfetch
An image from Farfetch’s September 2020 ‘Open Doors to a World of Fashion’ ad campaign.

High-end fashion seller Farfetch is about to make a big marketing push as it takes on Amazon for luxury shoppers online

Read the story.


 

Amazon Web Services CEO Andy Jassy
Amazon Web Services CEO Andy Jassy

Andy Jassy could be the next CEO of Amazon. Insiders dish on what it’s like to work for Jeff Bezos’ likely successor who built AWS into a $40 billion business.

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roz brewer profile 4x3
Roz Brewer.

New Walgreens chief Roz Brewer broke barriers to become the only Black female Fortune 500 CEO. Now she faces her toughest challenge yet: winning the vaccine-distribution race.

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More stories we’re reading:

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A Seattle court rejected Parler’s legal effort to force Amazon to bring it back online

GettyImages 1230524224
Parler faces an uncertain future.

  • A Seattle court rejected Parler’s attempt to force Amazon to bring the network back online.
  • Judge Barbara Rothstein said Parler failed to demonstrate how the injunction would benefit public interest.
  • Amazon Web Services removed Parler on January 11 for violating its terms of service.
  • Visit Business Insider’s homepage for more stories.

The US District Court in Seattle rejected social network Parler’s effort to get back on Amazon’s web hosting platform.

Amazon Web Services removed Parler after the social network violated its terms of service due to an increase in violent content posted to the platform in the wake of the insurrection at the US Capitol on January 6. Parler, a social network touted by conservative politicians and right-wing influencers, sued Amazon days later, claiming the move was politically motivated and anticompetitive.

Judge Barbara Rothstein said the court is not dismissing Parler’s claims at this time, but said the network failed to demonstrate how the injunction would benefit public interest.

“The Court explicitly rejects any suggestion that the balance of equities or the public interest favors obligating AWS to host the kind of abusive, violent content at issue in this case, particularly in light of the recent riots at the U.S. Capitol,” Rothstein wrote on Thursday. “That event was a tragic reminder that inflammatory rhetoric can-more swiftly and easily than many of us would have hoped-turn a lawful protest into a violent insurrection.”

Read more: Despite a historic inauguration, legendary investor Ellen Pao is not optimistic about tech’s relationship with the new White House

Parler’s user numbers surged following Twitter’s decision to permanently suspend Donald Trump. The app went offline a few days later after removal from Amazon, as well as Apple and Google’s app stores.

Amazon told Insider’s Ashley Stewart and Eugene Kim the firm had been in conversation with Parler “for weeks” over lax content moderation for violent posts. In a counter-lawsuit filed last week, Amazon claimed it first contacted Parler representatives on November 17 to discuss violent content on the app.

“AWS was in conversation with [Parler] for several weeks before a group of Amazon employees voiced complaints,” an Amazon spokesperson said. “This decision was made based on content that incited and encouraged violence that violated our terms of service.”

Parler, founded by former AWS software engineer John Matze, is funded by Fox News contributor Dan Bongino and conservative investor Rebekah Mercer.

Matze said he felt “confident” Parler would be back online by the end of the month, despite getting rejected from at least six large web service providers.

Apple CEO Tim Cook said he’s open to letting Parler back on the app store after improving content moderation.

Read the original article on Business Insider

Parler claims it was also dropped by Slack after Amazon and other tech giants cut ties with the controversial social media company

Parler
This illustration picture shows social media application logo from Parler displayed on a smartphone with its website in the background.

  • Parler CEO John Matze claimed in a court filing Wednesday that Slack had “canceled their services” to his company.
  • Matze claimed, in a lawsuit against Amazon’s AWS over its decision to cut ties with Parler, that Slack had cited “a violation of their own terms of service based on AWS’s decision to drop Parler.”
  • “Losing Slack makes it extremely difficult to effectively enforce our terms of service with our almost 600 volunteer and paid Jury members,” Matze said.
  • Major tech companies including Amazon, Twilio, Apple, and Google have cut ties with Parler in recent days amid widespread reports that rioters used the app to organize and incite violence at the US Capitol last week.
  • Visit Business Insider’s homepage for more stories.

Slack has joined the growing list of tech companies refusing to do business with Parler, according to Parler CEO John Matze.

“Slack Technologies, which provided a chat messaging system for coordinating with the Parler Jury that enforces our terms of service, abruptly canceled their services to Parler,” Matze claimed in a court filing Wednesday.

Slack did not respond to a request for comment on this story.

Matze submitted the filing as part of Parler’s antitrust lawsuit against Amazon’s cloud computing arm, Amazon Web Services.

Parler filed the lawsuit on Monday after AWS cut ties with the controversial social media company amid widespread reports that rioters who seized the US Capitol last week had used Parler to organize and incite violence.

“AWS’s highly publicized break… allowed the media to mischaracterize Parler in ways that have alienated Parler’s partners,” Matze claimed, adding that, in canceling its contract with Parler, Slack cited “a violation of their own terms of service based on AWS’s decision to drop Parler.”

“Losing Slack makes it extremely difficult to effectively enforce our terms of service with our almost 600 volunteer and paid Jury members,” Matze said in the filing.

Parler has faced massive fallout in the wake of last week’s violence as various business partners have cut ties.

Apple and Google removed Parler’s app from their app stores, also citing its alleged refusal to take down violent content. Not long afterward, many of Parler’s service providers, including Twilio, Okta, and Zendesk, removed Parler from their platforms as well.

Parler’s platform was knocked offline over the weekend after AWS suspended its contract, and with Google Cloud, IBM, and Oracle all refusing to take on Parler, the company has reportedly enlisted the services of Epik, a domain registrar known for hosting far-right content.

Read more: Inside the rapid and mysterious rise of Parler, the ‘free speech’ Twitter alternative, which created a platform for conservatives by burning the Silicon Valley script

Parler rose to notoriety in recent months as mainstream social media sites have faced increasing pressure to crack down on hate speech, misinformation, and calls for violence.

Following the US presidential election in November, Trump supporters flocked to alternative social networks, including Parler, to plan election protests after Facebook and other sites banned groups that pushed debunked conspiracies. From November 3 to November 9, Parler was downloaded around 530,000 times in the US, according to data from Apptopia.

Read the original article on Business Insider

Amazon is removing Parler from its web hosting service, meaning the platform will go offline Sunday if it can’t find another host

Parler
  • Amazon is removing the fast-growing social media network Parler from its web hosting service, according to an email obtained by BuzzFeed News. Amazon confirmed the authenticity of the letter to Insider.
  • Amazon Web Services said Parler violated its terms of service due to an increase in violent content shared on the website.
  • Unless Parler is able to find an alternative hosting platform, the website will go offline Sunday night.
  • The move comes after Google and Apple banned the Parler app from their app stores, also for violating policies by failing to remove violent content.
  • Visit Business Insider’s homepage for more stories.

Amazon is removing the fast-growing social media network Parler from its web hosting service, according to an email obtained by BuzzFeed News. Amazon confirmed the authenticity of the letter to Insider.

In the email, Amazon Web Services said Parler violated its terms of service due to an increase in violent content shared on the website. Amazon said it “cannot provide services to a customer that is unable to effectively identify and remove content that encourages or incites violence against others.”

“Because Parler cannot comply with our terms of service and poses a very real risk to public safety, we plan to suspend Parler’s account effective Sunday, January 10th, at 11:59PM PST,” the email said.

Unless Parler is able to find an alternative hosting platform, the website will go offline Sunday night.

Parler CEO John Matze confirmed Amazon’s decision in a post on the platform, saying its possible Parler will be offline for “up to a week.”

“We will try our best to move to a new provider right now as we have many competing for our business, however Amazon, Google and Apple purposefully did this as a coordinated effort knowing our options would be limited,” he said.

Google and Apple banned the Parler app from their app stores this week also for violating policies by failing to remove violent content.

Read more: Inside the rapid and mysterious rise of Parler, the ‘free speech’ Twitter alternative, which created a platform for conservatives by burning the Silicon Valley script

Parler did not immediately respond to Insider’s request for comment.

Amazon’s decision came amid calls by some of its employees for the company to stop providing cloud services to Parler, after some right-wing extremists used the site to plan the deadly siege at the US Capitol earlier this week.

In the email obtained by BuzzFeed, Amazon said it does not think Parler’s plan to moderate violent content manually with volunteers will work.

“This is further demonstrated by the fact that you still have not taken down much of the content that we’ve sent you,” the email said.

BuzzFeed shared screenshots of violent content on Parler that was included in Amazon’s email.

In one Parler post that included a photo of lawmakers taking cover during the Capitol riots, the user wrote: “How bout make them hang?”

Another screenshot showed a post that said “we need to start systemically assassinating #liberal leaders,” among others.

Parler became popular in recent months among supporters of President Donald Trump and members of the far right due to its lack of moderation.

Top conservative figures recently announced they would be moving to the Parler app and encouraged others to do the same, after Trump was banned from Twitter on Friday.

Read the original article on Business Insider