Amazon delivers on cloud computing profits, Infosys drops on outlook

Time for your daily dose of trending tickers, the stocks you’re following based on your Yahoo Finance ticker searches.

Amazon
Amazon (
AMZN) hit new highs as shares jumped more than 15%. Investors continued to buy into the e-commerce giant’s Q1 results. Amazon posted a loss of $0.12 a share, that’s less than what the street was expecting. But the big news was a 15% jump in revenue, helped by its secretive cloud computing business which saw a nearly 50% gain.

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Infosys
Ironically, advances in technology are being blamed for weakness at an IT company.
Shares of Infosys (INFY) tumbled over 6% after the company’s growth forecast missed estimates with the India-based FIRM blaming structural changes such as increased automation –for the weakness.
The company also cited a global slowdown as another headwind. Worldwide spending on information-technology services is projected to shrink about a half a percent this year,  according to Gartner.

Vale
Who knew bulls were into heavy metal? Shares of Vale (VALE), a Brazil based metal and mining company popped 10% after management said it was ramping up production of iron ore, as well as nickel and copper. Although results appear to be a positive referendum on global growth the sharp gains were also due to short covering as investors who bet against the stock covered their positions.

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Article source: http://finance.yahoo.com/news/amazon-reveals-secretive-cloud-computing-profit--144321131.html

4 Cloud Computing Funding Stories You Might Have Missed, April 24

Each week Talkin’ Cloud compiles a list of cloud computing financing stories for readers who might have missed the news earlier in the week. This week’s column features funding news from Freshdesk, DNAnexus, CareCloud and Keru Cloud.

These stories have been gathered from Talkin’ Cloud’s article database and other media sources. If we missed something, feel free to leave a comment below. We might just add it into the mix.

Here’s this week’s list of 4 Cloud Computing Funding Stories You Might Have Missed, April 24.

Freshdesk Raises $50 Million to Keep Pace with Zendesk and Salesforce in Customer Service Cloud. Freshdesk has added $50 million in a Series E financing round led by Tiger Global Management. Accel Partners and Google Capital also participated in the financing round. Freshdesk President Dilawar Syed told Forbes that his company plans to use the Series E funds to extend its reach in the cloud-based customer support software market: “The opportunity in this space overall is continuing to expand. And we’ve done it by focusing on product, then hiring, and really managed our marketing spend.”

TC 100 Profile: For Egnyte, ‘The Cloud Is Not Enough’

2015 TC 100 Survey Now Open

HP: We’re Not Leaving The Public Cloud Market

WuXi PharmaTech Invests $15M in DNAnexus, Signs Cloud Infrastructure Agreement. WuXi PharmaTech is investing $15 million in DNAnexus, which provides a cloud-based genome informatics and data management platform. In addition, WuXi PharmaTech subsidiary WuXi NextCode Genomics is partnering with DNAnexus “to provide cloud infrastructure and tools for genomic data management and analysis to researchers in China and other countries,” according to GenomeWeb. As part of the agreement, WuXi NextCode’s proprietary database infrastructure and clinical and research interfaces will be available on the DNAnexus cloud.

CareCloud Strengthens Operations with $15M in New Funding and Appointment of Silicon Valley Leader Ken Comée as CEO. CareCloud has secured $15 million in new funding and named ex-Iron Systems executive Ken Comée as its CEO. The company, which provides cloud-based practice management, electronic health record (EHR) and medical billing software and services, said it plans to use the funds “to further advance product innovation and customer success.”

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Baidu Invests $11M in Restaurant Management Platform to Bring More Local Businesses Under Its Wing. Keru Cloud, a restaurant management software-as-a-service (SaaS) company, has raised $11 million in Series B financing led by Baidu (BIDU) and Tianxing Capital. Fangjinglin Investment and Kaixing Capital also participated in the financing round. Tech in Asia pointed out that 3,000 restaurants currently use Keru Cloud, and Keru Cloud said it anticipates that 20,000 merchants could leverage its solution by the end of the year.

What are your thoughts on this week’s top cloud computing funding news? Share your thoughts about this story in the Comments section below, via Twitter @dkobialka or email me at [email protected]

Article source: http://talkincloud.com/cloud-computing-funding-and-finance/04-24-2015/4-cloud-computing-funding-stories-you-might-have-missed-april-24

Amazon reveals cloud computing revenue for first time … and its huge Sales …

by
Spencer Soper

Amazon has reported first-quarter sales that beat analysts’ estimates, with it breaking out the financial impact of its world-leading cloud computing division Amazon Web Services for the first time.

Sales at the company jumped 15 per cent to $US22.7 billion, the company said Thursday in a statement. Analysts on average projected $US22.4 billion, according to data compiled by Bloomberg. As well as its online sales business the company is also the world’s largest seller of cloud-computing services, with revenue at the division rising 49 per cent to $US1.57 billion.

Chief Executive Officer Jeff Bezos has pumped money into building new warehouses and data centres, and adding media content and services such as a marketplace for home-improvement professionals and a hotel-booking site. His aim is to keep users on Amazon for more of their everyday needs and to convert occasional shoppers into Prime members, who pay $US99 a year for delivery discounts and online streaming of music, movies and TV shows.

“For a company of this size, for them to continue to generate this kind of revenue growth is nothing short of impressive,” said Robert Drbul, an analyst at Nomura Securities International, which recommends buying the stock. “When you think of other companies in retail of this magnitude, it’s a big deal.”

Article source: http://www.afr.com/technology/amazon-reveals-cloud-computing-revenue-for-first-time--and-its-huge--sales-exceed-estimates-as-web-services-drive-growth-20150423-1ms62q

Microsoft Irish data case raises critical issues for cloud computing

A US court case considering whether a US judge can force Microsoft to hand over e-mails sitting in the company’s Irish data centre raises critical issues for cloud computing companies, according to David Etue, vice president of corporate development strategy for identity and data protection at global security company Gemalto.

Addressing a session at the RSA security conference here, Mr Etue said Microsoft’s ongoing appeal against the demand, after refusing to comply with the subpoena, is a case many security specialists didn’t notice because it involved a consumer cloud environment, Microsoft’s Hotmail web mail service.

However, he stressed that the case “is a big deal” and has far-reaching implications for the cloud sector.

“Microsoft has said this is extraterritorial, that you can’t subpoena data outside our US operations. If that was a piece of paper sitting in Microsoft’s Irish office, [a us court]would have ask the Irish government to go get that document,” Mr Etue said.

Instead, the court went directly to Microsoft to demand the e-mails. Microsoft is appealing the case on the grounds of data privacy, arguing that existing international treaties are the appropriate and lawful route for requesting cross-border data access.

Mr Etue believes the case will go all the way to the Supreme Court before it is resolved.

For the many big cloud service providers around the globe, the Microsoft case raises the question of “what’s the chain of ownership of the cloud”, he said.

“For example, if you are doing business with [Japanese provider] NTT in a service in Europe, does that bring the Japanese government into the conversation?”

For businesses using cloud providers, the chain of ownership raises security, governance, government discovery, and risk issues because many cloud companies and services utilise other cloud providers, especially companies offering Platform as a Service (PaaS) and Software as a Service (SaaS).

Encryption

Some PaaS and SaaS services could have at least five other cloud providers behind them, he said, and some do not make this clear to users of the service.

There are few industry standards concerning what companies have to communicate about such arrangements, and how, he said.

“It’s not clear who is responsible for discovery, and it’s not clear who is managing risk. Understanding what the trail of their data is, and how you control these environments, is critical in adopting the cloud in a secure fashion.”

Encryption is consequently, very important because “it’s the one security control that works when you don’t have control of the rest of the cloud infrastructure.”

You can take data that is encrypted and put them into a hostile environment and know they will remain secure with a mathematical degree of certainty, he noted.

Mr Etue emphasised that cloud users should use their own encryption in the cloud to retain control of encryption keys, because a cloud provider may have an obligation to surrender the keys of its own cloud encryption offering to government agencies such as the National Security Agency.

“We’re seeing [company] general counsels driving encryption now because of that [concern],” he noted.

The session, entitled Whose Cloud is it Anyway? Exploring Data Security, Ownership and Control, looked at aspects of data management for cloud service providers and for businesses using cloud services.

Article source: http://www.irishtimes.com/business/technology/microsoft-irish-data-case-raises-critical-issues-for-cloud-computing-1.2186247

1 Reason IBM May Fail to Deliver on Cloud Computing Profits

International Business Machines Corp. (NYSE: IBM  ) suffered another setback on Monday after the tech titan registered its 12th straight quarterly sales decline as investors continue to wait for the company turnaround strategy to bear fruit. 

Shares traded down just 1% the day after the earnings release as the report was not all bad news. Management said adjusted operating profits rose 4%, and currency-neutral revenues in strategic imperatives rose 30%.

As IBM transforms itself from a hardware manufacturer to a 21st century tech-services provider, the company has staked its future on core offerings that it believes will eventually drive sales and profits consistently higher. Those are cloud computing, business analytics, growth markets, and smarter planet, according to its 2011 Road Map to the Future. 

Today, both the company and analysts seem to believe that cloud computing is the key component for the future, and in its recent earnings report, management noted as a bright spot that cloud computing was on track to reach $3.8 billion in revenue this year, up from $2.3 billion last year. In February, management also said it would grow revenue from cloud and related future-oriented businesses to $40 billion by 2018, which seems like a big promise, considering those segments delivered less than $25 billion in sales last year.

Because of those years of sales declines, IBM stock is dirt-cheap today, trading at a forward price to earnings of just 10 times. It remains a hugely profitable company with one of the biggest brand names in tech, and it is one of the major players in cloud computing. However, there is a key obstacle to both its leadership in that area and its ability to derive significant profits.

The great disruptor
Amazon (NASDAQ: AMZN  ) may be the direct opposite of IBM. While IBM has seen sales slide for three years and spent its ample profits rewarding shareholders during that time, Amazon has taken the reverse approach. The company has consistently sacrificed profits in favor of growth, ignoring whatever protests may come from Wall Street or investors.

Amazon founder and CEO Jeff Bezos has made a mantra out of long-term investing and has called out high-priced competitors, famously saying, “Your margin is my opportunity.” The company has made low prices a staple of its value proposition to customers, and time and again, the company has shown it is unafraid to sacrifice profits for long-term positioning. It has made waves in every industry it enters, from retail to book publishing to video streaming. 

One of Amazon’s most promising businesses is cloud computing, or Amazon Web Service. Bezos believes AWS will one day surpass retail to become the biggest division at the company.

Amazon will break out AWS performance for the first time in its earnings report on Thursday, April 23rd. Previously, it reported cloud sales in its “Other” category, of which the bulk is AWS. In 2014, the Other category brought in $5.6 billion, up over 40% for the year, well ahead of IBM.

The two companies are not always direct competitors in the cloud business: IBM tends to specialize in Software as a Service (Saas), while Amazon is better known for Infrastruture (IaaS). However, Amazon has a head start and reputation for low prices that could mean IBM will not be enjoying huge cloud computing profits anytime soon.

Even without Amazon, cloud computing appears to be a low-margin business, as a study of 22 competitors found a free cash flow margin of just 4.5%. Amazon, meanwhile, reported a net loss for the year.

That is a problem for IBM and any investors who are counting on cloud computing to bring the company back to glory. Sales growth in cloud computing will continue, but it will not deliver the profit margins IBM previously enjoyed from traditional service businesses.

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Article source: http://www.fool.com/investing/general/2015/04/23/1-reason-ibm-will-fail-to-deliver-on-cloud-computi.aspx

SKYY High for the Cloud Computing ETF

Active followers of the exchange traded funds industry may remember the reception the First Trust ISE Cloud Computing Index Fund (NasdaqGM: SKYY) when it debuted nearly four years ago.

Plenty of folks had something to say about SKYY and most of the commentary was to dismiss the ETF as too much of niche product. Niches or not, critics are eating crow as SKYY has returned 49.1% over the past two years, a performance that is about 50% better than the SP 500 over the same period.

Year-to-date, SKYY is up 6.9%, which is 60 basis points ahead of the Nasdaq Composite and nearly triple the returns delivered by the SP 500.

Cloud computing refers to a mode of accessing digital information from the internet through web-based tools and applications, instead of directly connecting to a server. The desired data and software packages are stored in servers where a consumer can access them anywhere as long as one has access to the internet. It is SKYY’s somewhat loose interpretation of cloud computing companies that has driven the ETF’s stellar performance. [Tech Investors Love the Cloud]

For example, SKYY’s largest holding is Netflix (NasdaqGS: NFLX). Netflix, classified as a consumer discretionary company and not often viewed as a true cloud player, commands a weight of 5.1% in SKYY, meaning SKYY has one of the largest Netflix allocations of any ETF.

Amazon (NasdaqGS: AMZN), more of a cloud company than Netflix though still a member of the discretionary sector, is SKYY’s fourth-largest holding at a weight of 3.9%. With Netflix and Amazon up 63.9% and 26%, respectively, this year, SKYY shareholders probably are not complaining about the inclusion of those stocks in the ETF. [Netflix ETFs]

SKYY tracks the ISE Cloud Computing Index, which “is a modified equal dollar weighted index designed to track the performance of companies actively involved in the cloud computing industry. To be included in the index, a security must be engaged in a business activity supporting or utilizing the cloud computing space, listed on an index-eligible global stock exchange and have a market capitalization of at least $100 million,” according to First Trust.

Here is the deal with that index and it explains the inclusion of stocks like Netflix and Facebook (NasdaqGS: FB) in SKYY. The ETF’s index can hold companies that are not pure play cloud firms as long as those firms “provide goods and services in support of the cloud computing space.” SKYY can also hold tech conglomerates as long as those companies “indirectly utilize or support the use of cloud computing technology,” according to First Trust.

Indexing quirks can be found throughout the ETF universe. Again, SKYY investors are not complaining. The ETF has added $54.5 million of its $452.3 million in assets under management this year and was one of just 27 ETFs to hit an all-time high on Wednesday.

First Trust ISE Cloud Computing Index Fund

skyy

Article source: http://www.etftrends.com/2015/04/skyy-high-for-the-cloud-computing-etf/

‘We Go To Cloud Computing To Magnify And Amplify Our Talents, Not Just To …

Cloud computing has many variations and nuances, and everyone is doing something different with it. However, there appear to be four distinct phases to the cloud evolution (or revolution?).  We’re still early in the process (working our way through the second phase), but ultimately, it will bring organizations to the point in which decision-making is pushed down through the ranks, and traditional business models are cast aside in favor of more entrepreneurial ventures — even within large corporations.

That’s the word from Don Rippert, IBM general manager of cloud strategy, who discussed where the world is at in the progression in a recently released video. Speaking at the company’s InterConnect event, Rippert started off by reminding attendees that the purpose of cloud wasn’t to make things simpler, but rather, “magnify and amplify” the talents of employees. “Clouds are not designed to make things so simple that a trained dog could do it,” he pointed out. “They’re designed to make things so good that you can build the best possible apps in the shortest time.”

To that end, organizations are moving through a four-stage evolution with cloud computing. Ultimately, the goal is not just to make things run simpler and smoother across businesses, but rather, cloud is enabling people to move their businesses and careers to a higher purpose, with greater achievements.

1) Era of infrastructure: In its first phase, which began five to six years ago, cloud did start out with the intention of making things easier.  “People tended to see clouds as variable infrastructure that they could use to offset some need for infrastructure they had behind the firewall,” Rippert pointed out.

2) Era of hybrid apps; This is where most organizations are at right now, Rippert states. “People are building applications that are more than just using infrastructure; they’re doing more than just taking advantage of somebody’s server or storage. They’re actually processing business transactions.”

3) Era of composable applications through application programming interfaces (APIs): This is where both enterprise and publicly available APIs are employed to assemble new applications or capabilities. “This next generation requires people to use APIs that enterprises are publishing. In this third phase of cloud, you’re going to see a lot of developers using capabilities from many clouds to compose quickly an application primarily based on the APIs that they’re buying.”

4) Era of hybrid data: In this final and upcoming stage of the cloud evolution, data is packaged and delivered across networks in the same manner as apps. “Right now if you’re an enterprise, you’re collecting data, but you don’t have all the data that you need,” Rippert says. “You should be able to go out and buy data from data vendors. Just as you can create hybrid applications, you should be able to create hybrid data stores. For example, if you’re an insurance company and you need weather data,  you should be able to go and buy weather data. In this world, people won’t just be buying applications through APIs, they will be buying data sets.”

Ultimately, the goal isn’t just to have cloud computing, but rather, to propel organizations toward digitization, and break down the hierarchy of decision-making that has defined organizations for decades. As cloud evolves into a hybrid data delivery environment, the shift to the digital enterprise will accelerate. Rippert pointed out three key elements of digitization. First, “you want to move decision making down to the front lines — the days are gone where somebody sits in a castle and tells everybody on the front line what to do and how to do it,” he says. “What we want instead is we want people in the front lines to have access to have the data and analytic capabilities, close to the customer.”

The second shift in digital is toward insight-driven processes, he says. “We want to augment the day to day decision making with the information that’s coming out of our systems and out of our processes. We want to have better processes.” Finally, the cloud evolution is bringing about digital innovation. “You have new businesses you just couldn’t do ten years ago,” he says. ” Sometimes they’re the province of startups, sometimes they’re the resurrection of companies whose prior business model isn’t working any more.”

Article source: http://www.forbes.com/sites/joemckendrick/2015/04/23/we-go-to-cloud-computing-to-magnify-and-amplify-our-talents-not-just-to-make-things-simpler/

Cloud computing spending to hit $32bn in 2015

Public cloud spending will grow by 25 percent in 2015 to reach a staggering $21bn, as firms continue to host services on platforms from the likes of Amazon Web Services, Google and Microsoft.

Data from analyst house IDC also revealed that private cloud IT infrastructure spending will grow 16 percent over the year to $12bn. This will give a worldwide total cloud spend for 2015 of $32bn, up 28 percent on 2014’s $26.4bn.

Western Europe is expected to see the highest growth in cloud IT infrastructure spending at 32 percent, followed by Latin America (23 percent), Japan (22 percent) and the US (21 percent).

Overall, this will mean that 33 percent of all IT infrastructure spending in 2015 will be in the cloud, which shows that there is still some way to go before cloud becomes the preferred platform for hosting IT systems.

However, the gap will be even closer by 2019 when 45 percent of total IT infrastructure spend will be on cloud systems, at a total of $52bn. This will be split between $32bn for public cloud services and $20bn for private cloud.

Kuba Stolarski, research manager for server, virtualisation and workload research at IDC, said it is clear that the cloud market is still in a period of intense growth.

“The pace of adoption of cloud-based platforms will not abate for quite some time, resulting in cloud IT infrastructure expansion continuing to outpace the growth of the overall IT infrastructure market for the foreseeable future,” he said.

“As the market evolves into deploying third-platform solutions and developing next-gen software, organisations of all types and sizes will discover that traditional approaches to IT management will increasingly fall short of the simplicity, flexibility and extensibility requirements that form the core of cloud solutions.”

This huge growth of cloud services, both public and private, suggests that fears raised by the Edward Snowden revelations of 2013 have not damaged trust in remotely hosted systems.

Indeed, V3 has recently heard from firms as diverse as Harley-Davidson, Netflix and specalist sports shoe retailer Vivobarefoot about how they are using the cloud to improve their use of IT, and bring more flexibility and cost savings to the business.

Article source: http://www.v3.co.uk/v3-uk/news/2405174/cloud-computing-spending-to-hit-usd32bn-in-2015