Investing.com — UBS maintained “buy” ratings on three major cloud providers as their combined revenue rose to $84.8 billion in the first quarter of 2026, up 39% from a year earlier, marking a 15-percentage-point acceleration from the growth rate recorded in the same period last year.<\/p>\n
The brokerage attributed the stronger performance to unprecedented demand for artificial intelligence-related computing capacity.<\/p>\n
Microsoft, Amazon and Oracle generated combined sequential revenue growth of $6.5 billion in the quarter, a 196% increase from a year earlier, UBS said in a research note. The firms have now posted four consecutive quarters of historically elevated sequential gains.<\/p>\n
UBS expects combined sequential revenue additions to increase to $8.5 billion in the second quarter of 2026. Wall Street forecasts sequential revenue growth of between $8.1 billion and $9.8 billion for the group through the end of the year, according to the note.<\/p>\n
Google Cloud led the acceleration, posting 63% revenue growth to $20.03 billion in 1Q26, a 35-point acceleration since 1Q25, while AWS grew 28% to $37.59 billion, an 11-point acceleration over the same period. Microsoft Azure held steady at 39% for four straight quarters as the company redirected capacity toward internal needs.<\/p>\n
The combined committed backlog of Amazon, Microsoft, Google, Oracle and CoreWeave reached $2.10 trillion at the end of 1Q26, up 184% year-over-year, with the five providers adding $400 billion to $450 billion in new backlog each of the last three quarters, according to company filings cited by UBS.<\/p>\n
Amazon\u2019s backlog alone stood at $364 billion, of which $225 billion, or 62%, represented Trainium chip commitments, the note said. Microsoft\u2019s commercial backlog reached $627 billion, with 45% tied to OpenAI as of the December 2025 quarter.<\/p>\n
Google\u2019s backlog surged $222 billion sequentially to $462 billion in 1Q26, driven in part by TPU chip sale agreements with external customers, a new revenue stream the company said it would begin recognizing later in 2026, with the majority converting to revenue in 2027.<\/p>\n
On margins, the combined operating margin for AWS, Microsoft\u2019s Intelligent Cloud segment and Google Cloud held at 37% in 1Q26, unchanged from 4Q25, with AWS at 38% and Google Cloud expanding to 33% from 18% in 1Q25, the note showed.<\/p>\n
Microsoft disclosed annualized AI revenues of $37 billion, up 123%, while Amazon reported AWS AI revenues exceeding $15 billion, up more than 100% year-over-year. Google cited 800% growth in enterprise AI revenues without providing an absolute figure.<\/p>\n
AWS Bedrock, Amazon\u2019s AI development platform, reached 125,000 customers, covering 80% of the Fortune 100, with customer spend growing 170% quarter-over-quarter, Amazon said. “Bedrock is now a multi-billion dollar annualized run-rate business,” Amazon said on its 4Q25 call.<\/p>\n
Combined capex for the five providers is projected at $673.14 billion in 2026, up 76% from $382.66 billion in 2025, according to UBS estimates. Google indicated 2027 capex would “significantly increase” from 2026 levels.<\/p>\n
A UBS survey of approximately 140 enterprises found Microsoft Azure preferred by 69% of respondents for AI infrastructure, followed by AWS at 53% and Google Cloud at 27%, down from 31% in October 2025.<\/p>\n
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