In the competitive landscape of cloud computing, Amazon Web Services (AWS) is experiencing increased pressure from rivals Microsoft Azure and Google Cloud. A recent analysis by TechRadar, published on November 21, 2025, highlights AWS’s declining market share, attributed largely to the rising demand for artificial intelligence (AI) capabilities. AWS currently holds a 29% share of the market, according to posts on X from App Economy Insights. In contrast, Microsoft Azure has captured 22%, while Google Cloud commands 12%, indicating a significant narrowing of the gap.
The global cloud infrastructure market reached a staggering $107 billion in Q3 2025, reflecting a quarterly increase of $7.6 billion, as reported by Synergy Research Group and cited in CRN. While AWS, Microsoft, and Google Cloud collectively account for 62% of this market, AWS has shown signs of slowing growth, allowing its competitors to maintain or even improve their positions.
AI Demand Reshapes Market Dynamics
The rapid expansion of AI workloads significantly influences the cloud services sector. According to Jamin Ball’s updates on X, AWS reported a run rate of approximately $117 billion, growing at 17% year-on-year in Q1 2025. In contrast, Azure demonstrated robust growth with a run rate of around $77 billion and a 35% annual increase. Google Cloud also showcased impressive performance with a $49 billion run rate, reflecting a 28% year-on-year growth. By Q2, Azure surged further to nearly $86 billion at 39%, while Google reached $54 billion at 32%.
Cloud Wars, in a piece published on November 6, noted that Google Cloud’s 32% growth in Q3 outpaced AWS’s 20% increase and Microsoft’s performance, signaling a shift in the competitive landscape driven by AI-related business opportunities. Additionally, Oracle has emerged as a potential disruptor, with Cloud Wars highlighting its superior remaining performance obligations (RPO) growth compared to AWS and Microsoft.
Quarterly Earnings Reveal AWS Vulnerabilities
The Q2 2025 earnings reports, analyzed in detail by CRN, exposed vulnerabilities within AWS’s operations. Despite posting solid overall numbers, AWS struggled to compete with the AI-driven surges from its rivals. TechPulse Daily echoed TechRadar’s observations, noting that while AWS has historically dominated the cloud market, its position may be gradually eroding as Microsoft intensifies its pursuit of the top spot.
Google’s ascent has been particularly noteworthy, with Cloud Wars reporting its remarkable 32% growth in Q2. Both Oracle and Microsoft have also demonstrated strong performance, suggesting a reshuffling of market positions. Aethir’s commentary on X warned that centralized cloud providers like AWS face challenges in addressing GPU demand, costs, and scalability for AI, thus creating opportunities for competitors.
Strategic innovations and responses from AWS include the introduction of Bedrock and custom chips. Nevertheless, Cloud Wars characterized AWS’s 20% growth in Q3 as insufficient against the substantial AI backlogs faced by its competitors. Microsoft has leveraged its partnership with OpenAI to bolster Azure’s growth, while Google continues to invest in Tensor Processing Units (TPUs) and its Gemini platform.
Future commitments are likely to shape the industry’s direction. Cloud Wars reported that Oracle and Google are already outpacing AWS in RPO, focusing on securing AI contracts rather than relying solely on past revenue. AWS’s recent struggles were underscored by a significant outage in October 2025, which lasted 15 hours and disrupted access to popular applications like Roblox. This incident highlights the reliability risks faced by AWS in a market where even short downtimes can lead to substantial financial losses.
Geopolitical and regulatory challenges also loom over the cloud giants. Alibaba’s market share has been affected by global tensions, while U.S. companies navigate increasing scrutiny regarding AI regulations. The Cloud Institute’s retrospective analysis emphasizes AWS’s pioneering role in the market, yet it acknowledges the strong positions of Azure and Google, particularly in terms of enterprise adoption and data capabilities.
As the demand for AI infrastructure continues to rise, AWS’s longstanding throne appears increasingly unstable. Industry experts are closely monitoring the upcoming Q4 earnings for insights into potential shifts in market leadership.
