By Yang Jianyong

Since OpenAI rolled out ChatGPT in late 2022, artificial intelligence has ushered in the era of generative AI. A plethora of large-scale models have breathed new life into innovation across various industries, which are swiftly integrating large model services, propelling the cloud services market into a new phase of expansion.

Amazon, Microsoft, Google, and Alibaba stand out as frontrunners in the global cloud services market competition. Notably, Microsoft has emerged as one of the major beneficiaries in the generative AI era, thanks to its investment in and deep integration with OpenAI, a highly coveted AI large model firm.

In terms of revenue, Microsoft reigns as the world's largest cloud services provider and the second-largest public cloud provider on a global scale. In the second quarter of fiscal year 2026, which concluded on December 31, 2025, Microsoft's cloud revenue soared to $51.5 billion, marking a 26% year-over-year surge.

Revenue from the Intelligent Cloud segment hit $32.9 billion, up 29% from the previous year. Within this, revenue from Azure and other cloud services surged by 39% year-over-year. AI stands as the driving force behind the growth of cloud services.

Leveraging the robust performance of its cloud services, Microsoft's total revenue in the second quarter reached $81.3 billion, a 17% year-over-year increase; net profit skyrocketed to $38.5 billion, a 60% year-over-year jump.

Despite such impressive revenue figures, Wall Street remained unfazed, particularly alarmed by the deceleration in cloud business growth. This prompted a 9.99% plunge in Microsoft's stock, resulting in a staggering $357.4 billion (approximately RMB 2.48 trillion) loss in market value overnight, setting a record for Microsoft's largest-ever market value contraction.

It's worth noting that during the previous quarterly earnings release, Microsoft's market value soared past the $4 trillion mark, fueled by the stellar performance of its Azure business, making it the second company globally, after NVIDIA, to breach this milestone.

On July 31, 2025, Microsoft hit an all-time high, setting a new benchmark in its corporate history with a market value of $4.15 trillion. Regrettably, its current market value stands at $3.22 trillion, a $930 billion (approximately RMB 6.5 trillion) decline from its peak.

Nowadays, Wall Street is starting to fret over the deceleration in growth of Azure and other cloud services. Critically, concerns are mounting regarding the deep integration of its cloud business with OpenAI, which has more than doubled Microsoft's remaining performance obligations for cloud services to $625 billion, with nearly half attributed to OpenAI.

As the world's largest cloud provider, despite its robust cloud services revenue, Microsoft is seen as falling short in Wall Street's eyes, triggering sell-offs and a market rout, with a $357.4 billion loss in market value overnight. Other cloud providers are also likely to feel the impact.

Presently, the market values of the four major global cloud providers are as follows: Amazon at $2.58 trillion, Microsoft at $3.22 trillion, Google at $4.09 trillion, and Alibaba at $416 billion.

Currently, Google stands out as the top performer among the major cloud providers. Its Gemini large model, through continuous refinement, has exerted pressure on OpenAI in multiple dimensions. In the AI chip arena, Google's TPU chips boast formidable technical prowess, posing one of the greatest challenges to NVIDIA's GPUs. Meanwhile, in the cloud services market, as the world's third-largest cloud services provider, Google's market share continues to climb, showcasing formidable competitiveness.

In the global cloud services market competition, although Google's cloud services share trails behind Amazon and Microsoft, its increased technological investments, particularly in large models, have bolstered its competitiveness and positioned it to capture more market share. With the application of large models, Google Cloud's global market share keeps rising, indicating that AI large models are reshaping this search behemoth. This has fueled its meteoric rise in the capital markets, with outside observers even beginning to speculate whether it can overtake NVIDIA and claim the top spot in global market value.