Redburn: Amazon Cloud Business is expected to be worth $3 trillion

    As per a Redburn Ltd. analyst, Amazon cloud storage division is on track to reach a $3 trillion valuation, which is almost triple the current stock market value of the entire corporation.

    Analyst Alex Haissl stated in 128-page research introducing coverage of the cloud computing sector that the corporation may opt at some time to separate apart the very successful, slower-growing online retail operation from the unit because Amazon Web Services or Amazon cloud is so powerful. When the $3 trillion value might be reached was not specified by him.

    About the Amazon Cloud

    Haissl, a former head of automotive research at Berenberg and Credit Suisse Group who started his career as a police officer in Vienna, claimed that separating AWS may not be an option at this time, but if the performance gap versus the non-AWS sections widens, it may be in the future.

    Redburn: Amazon's cloud business is expected to be worth $3 trillion
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    Haissl advises purchasing Amazon shares and projects that the company will hit $270 in one year, which is 150 percent higher than Tuesday’s closing price and the highest forecast on Wall Street. He also gave Microsoft a buy rating, Snowflake a neutral rating, and MongoDB a sell rating.

    Even though sales in the company’s primary e-commerce division declined in the first quarter, Amazon Web Services’ revenue increased by 37% to $18.4 billion. There is no way to downplay online retail’s dismal performance, he added, adding that they do not believe the industry is intrinsically flawed.

    Better than Others

    Because of its reduced prices and superior technology, the Amazon cloud division is better positioned than its competitors from Microsoft and Alphabet Inc., as per Haissl. Less than 20% of Amazon’s sales come from Amazon Web Services, but it will contribute all of its profits this year.

    Redburn: Amazon's cloud business is expected to be worth $3 trillion
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    However, based on a strong stance in on-premise IT infrastructure, Bloomberg Intelligence analyst Anurag Rana believes Microsoft may be in a stronger place than Amazon Web Services and Alphabet’s Google as businesses speed up their shift to a hybrid-cloud model. Rana determines the value of AWS at $1.5 trillion to $2 trillion.

    Rana also added that, because the cloud division is a major source of funding for Amazon’s other business divisions, it is highly improbable that the division will be spun off.

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