Has AWS turned a corner?

Today: AWS growth ticks up a fraction for the first time in a while, CISA issues an "unprecedented" warning to government agencies, and the latest moves in enterprise tech.

Has AWS turned a corner?
Photo by Aleksander Fox / Unsplash

Welcome to Runtime! Today: AWS growth ticks up a fraction for the first time in a while, CISA issues an "unprecedented" warning to government agencies, and the latest moves in enterprise tech.

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Lucky 13

After Microsoft and Google showed signs of renewed strength in cloud infrastructure spending, AWS joined the party Thursday by reporting a slight increase in revenue growth compared to the previous quarter. While it's clear that this market is slowing down after years of runaway growth — due to a once-in-a-generation shift in tech infrastructure strategy thinking — it does seem that more than a year of contraction is coming to an end.

AWS reported revenue of $24.2 billion during the last quarter of 2023, which was a 13% increase over the previous year. That's a far cry from the growth rates that AWS regularly cranked out up until last year, but it was in line with analyst expectations, and up just a tad from the 12% growth it posted in the third quarter of 2023.

  • “We expect the acceleration to continue in 2024,” Amazon CFO Brian Olsavsky said on a conference call, according to CNBC.
  • As acceleration goes, AWS's fourth-quarter performance is not exactly a Tesla, but neither is it a Pinto.
  • And in a consolation prize to the thousands of people it laid off over the last couple of years and hopefully still have their stock grants, AWS operating profit surged 38% to $7.2 billion.

Earlier this week Microsoft CEO Satya Nadella said that the "optimizations" that all cloud providers said customers were undertaking to cut costs in 2023 seem to have passed, and companies are starting to launch new projects, mostly thanks to the generative AI boom.

  • Olsavsky agreed: "We continue to see the diminishing impact of cost optimizations," he said on a conference call with investors.
  • Compared to its cloud rivals, AWS is particularly exposed to volatility in the startup market, which had one of its worst years in recent memory during 2023.
  • But Amazon CEO Andy Jassy also said that larger companies who had paused cloud migrations during 2023 due to economic anxiety started to pick up the pace during the fourth quarter.

Still, AWS continues to grow slower than its two major rivals, despite recording more cloud infrastructure revenue as the two of them combined, based on back-of-the-envelope math thanks to Microsoft and Google's refusal to break out those specific numbers.

  • Jassy used some of his time on the call to once again throw shade at Microsoft's security track record over the last year, after AWS CEO Adam Selipsky took the same line during his re:Invent keynote in November.
  • And executives were peppered with questions from analysts about AWS's approach to the generative AI boom, which lacks both the superstar partner that Microsoft controls in OpenAI and Google's years of research on the fundamental technology.
  • "Gen AI is, and will continue to be an area of pervasive focus and investment across Amazon primarily because there are few initiatives — if any — that give us the chance to reinvent so many of our customer experiences and processes, and we believe that will ultimately drive tens of billions of dollars of revenue for Amazon over the next several years," Jassy said.

Shut it down

CISA issued a stark warning to U.S. government agencies Wednesday to "disconnect all instances" of two VPN software tools from Ivanti by 11:59 p.m. Friday as attackers continue to exploit several zero-day flaws in the software.

Patches are available for some versions of the software affected by the flaws, but CISA is taking further steps to require agencies to do a factory reset of the affected devices and upgrade to a new version of the software before putting the affected devices back into production. Earlier this month the agency urged government agencies to "mitigate" the flaws, which attackers have been exploiting since December, but apparently that wasn't enough.

"Ivanti is an American company. This is unprecedented," said Scott Piper, a cloud security expert. Government agencies have until the end of Monday to report their progress on disconnecting the appliances.

Enterprise moves

Seema Verma is the new head of Oracle's Cerner health-care unit, after about a year at Oracle following a stint running Medicare for the Trump administration.

Michael Baker and Yuval Barkan are the new president and chief product officer, respectively, at Noname Security.

Portland's own Dana Lawson is the new CTO at Netlify, a promotion from her previous role as senior vice president of engineering.

Mark Porter is the new CTO at dbt Labs, joining the company after serving as MongoDB's CTO.

Philip Moon is the new CFO at Homebase, following two years at CloudTrucks as head of finance.

Bart Hammond is the new chief customer officer at Armis, joining the company after holding a similar position at Drift.

The Runtime roundup

A new round of layoffs hit enterprise tech this week: Proofpoint laid off 6% of its staff, Okta cut 7% of its employees, and Zoom said goodbye to 150 employees.

Broadcom's Ricky Cooper defended the company's post-VMware acquisition moves as a "need to hit the reset button" after years of pricing changes following changes in control of the virtualization factory.

AI2, the nonprofit AI research company founded by late Microsoft co-founder Paul Allen, introduced a new open-source large-language model that not only discloses the code and model weights but also lets users examine its training data.

Meta plans to roll out a new version of a homegrown AI chip next year in its data centers, according to Reuters.

Companies are starting to get it: ransomware payments fell to a new low at the end of 2023, with just 29% of companies opting to feed the beasts.

Thanks for reading — see you Saturday!

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