- Cloud revenue nearly crossed a crucial milestone in Q2
- Money is also flowing back out the door as hyperscalers build new data centers
- The collective order backlog for AWS, Google Cloud and Microsoft hit $669 billion in Q2
The numbers are in and it seems the cloud market is about to hit a key milestone. Cloud infrastructure revenue came in at an estimated $98.8 billion in Q2 2025, according to Synergy Research Group, and continues to grow at a rapid clip. The flip side? Providers are spending an equally hefty amount of cash on cloud expansions.
It almost goes without saying that hyperscalers accounted for the bulk (roughly $63-$65 billion) of the aforementioned quarterly tally. AWS alone brought in $30.9 billion in revenue while Google Cloud added another $13.6 billion.
Microsoft doesn’t break out Azure revenue, but given AWS executives said on an earnings call that the number two market player is about 65% of its size, and Microsoft itself disclosed Azure is a $75 billion-a-year-business, that would put Azure quarterly revenue in the $18 to 20 billion range.
All three continued to post healthy growth rates, too. Microsoft said Azure and other cloud services revenue grew 39%, Google Cloud’s revenue climbed 32% and AWS brought up the rear with a 17.5% growth rate.
Asked during Q2 earnings why it grew slower than competitors, Amazon CEO Andy Jassy chalked it up to AWS having a larger customer base to begin with and quarterly variability.
“This is a good time to be a cloud provider. Despite being on the verge of becoming a hundred billion dollar per quarter market, cloud revenues are still growing by around 25% per year, and we are forecasting that average annual growth over the next five years will remain above 20%,” Synergy Chief Analyst John Dinsdale stated. “We can thank GenAI for supersizing what was already a big and high-growth market.”
Rising Capex
The flip side, of course, is the rising tide of capital spending that has accompanied this growth as cloud providers scramble to fulfill multi-billion-dollar order backlogs.
AWS, Google Cloud and Microsoft alone spent a total of $78 billion in capex in Q2 2025. Industry-wide, that figure would obviously be much higher given the investments Oracle, CoreWeave and others are making.
Spending isn’t slowing down anytime soon, either. Google Cloud actually upped its 2025 capex guidance by $10 billion.
But even though they’re spending money seemingly as fast as they’re making it, cloud providers don’t really have a choice.
The big three hyperscalers have a collective order backlog of $669 billion that they need to fill. All three companies said there is currently more demand than available capacity and both Google and Microsoft noted constraints are expected to persist through the end of calendar 2025.