Global · cloud vs AI cloud
Cloud to AI cloud: the ordinary cloud is still growing, and AI is being added on top
Cloud revenue is accelerating, not shrinking: in Q2 2026 AWS grew 37% to $42.2bn, Google Cloud 82% to $24.8bn and Microsoft's Intelligent Cloud 32% (SEC filings). GPU servers were 52.6% of the $166.3bn server market (IDC, Q2 2026), yet ordinary server shipments also rose. Microsoft, Amazon, Meta and Oracle added $201bn of servers at cost in their latest years.
Updated 11 October 2026 · data build 2026-10-10 · how we know · corrections
AWS +37%, Google Cloud +82%, Microsoft Intelligent Cloud +32%: cloud growth is speeding up
Year-on-year growth in quarterly segment revenue, as each company reports it, to Q2 2026. A segment (a business line a company reports separately) mixes ordinary cloud and AI. Measured
| Segment | Quarter | Revenue $bn | Year on year | Operating income $bn | Margin |
|---|---|---|---|---|---|
| AWS | Q2 2026 | 42.2 | +36.8% | 16.6 | 39% |
| Google Cloud | Q2 2026 | 24.8 | +81.8% | 8.8 | 36% |
| Microsoft Intelligent Cloud | Q2 2026 | 39.3 | +31.6% | 16 | 41% |
| Microsoft Cloud (all cloud revenue) | Q2 2026 | 59.3 | +27% | – | – |
Quarters are placed in the calendar quarter they mostly cover (Microsoft's fiscal year ends in June). Microsoft Intelligent Cloud is shown from fiscal 2024, on the basis Microsoft recast in 2024; earlier quarters are not comparable.
Download CSV ↓Source: Amazon latest filing (XBRL) · Alphabet latest filing (XBRL) · Microsoft latest filing (XBRL) · as of 2026-10-11 · SEC EDGAR XBRL; Q4s derived as full year minus nine months · Compiled by StackPath
GPU servers took 52.6% of a $166.3bn server market, but ordinary servers grew too
IDC's worldwide server tracker, Q2 2026. An accelerated server carries GPUs or other AI chips beside its ordinary processors (CPUs). Reported
| Quarter | Total $bn | y/y | GPU servers $bn | y/y | GPU share | US $bn | Western Europe $bn | Released |
|---|---|---|---|---|---|---|---|---|
| Q2 2026 | 166.3 | +52% | 87.4 | +28.1% | 52.6% | 112.2 | 9.1 | 10 Sept 2026 |
| Q1 2026 | 122.6 | +30.4% | 68.9 | +24.8% | 56.2% | 79.6 | 7.6 | 15 Jun 2026 |
Headline figures from IDC press releases only; IDC's tracker data is not republishable. Ordinary servers = total minus GPU and other accelerated servers (our arithmetic). In Q1 2026 IDC said non-accelerated revenue fell slightly; by Q2 2026 units were rising again, at higher prices as memory got dearer.
Source: IDC, Q2 2026 server tracker release · IDC, Q1 2026 server tracker release · as of 2026-10-11 · Compiled by StackPath
The chip makers' data-centre revenue, as a GPU-vs-CPU proxy. Nvidia's is almost all GPUs and networking; Intel's Data Center and AI segment is mainly server CPUs; AMD's mixes both. Year-on-year growth by quarter.
| Segment | Quarter | Revenue $bn | Year on year |
|---|---|---|---|
| Nvidia Data Center | Q2 2026 | 89 | +117% |
| Intel Data Center and AI | Q2 2026 | 6.3 | +59% |
| AMD Data Center | Q2 2026 | 6.7 | +107% |
Nvidia's fiscal quarters end about a month after calendar quarters; each is placed in the calendar quarter it mostly covers. Intel shown from 2024, on its 2025 recast basis. For the suppliers in depth see the AI supply chain pages.
Download CSV ↓Source: Nvidia latest filing (XBRL) · Intel latest filing (XBRL) · AMD latest filing (XBRL) · as of 2026-10-11 · Compiled by StackPath
Servers at cost: Microsoft's rose $83bn in one year to $216bn
Gross cost of servers and network equipment on each company's balance sheet at its latest year-end (before depreciation), from the 10-K property note. This is the stock of hardware; capex is the flow that adds to it. Measured
| Company | As the company labels it | Latest | $bn | Year before $bn | Added $bn | Growth |
|---|---|---|---|---|---|---|
| Microsoft | Servers, network equipment and software | 2026-06-30 | 215.9 | 132.8 | 83 | +63% |
| Alphabet | Technical infrastructure (servers, network equipment and data-centre buildings) | 2025-12-31 | 203.7 | 141.9 | 61.8 | +44% |
| Amazon | Servers and networking equipment | 2025-12-31 | 172.5 | 113.2 | 59.3 | +52% |
| Meta | Servers and network assets | 2025-12-31 | 98 | 68.4 | 29.6 | +43% |
| Oracle | Computer, network, machinery and equipment (mainly servers and networking) | 2026-05-31 | 59.6 | 30.3 | 29.3 | +97% |
Alphabet reports 'technical infrastructure', which includes data-centre buildings, so it is not like-for-like (pale bar). Oracle's line is computers, network, machinery and equipment, mostly servers. Year-ends differ: Microsoft June, Oracle May, the others December.
Download CSV ↓Source: Microsoft 10-K · Alphabet 10-K · Amazon 10-K · Meta 10-K · Oracle 10-K · as of 2026-10-11 · Compiled by StackPath
For the cash these companies spend each quarter, see hyperscaler capex.
From 2020 to 2024 every big cloud stretched its server lives; in 2025 Amazon became the first of the five to shorten some
Changes to the useful life of servers and network equipment disclosed in 10-Ks, and the first-year effect each company reported. Measured
| Effective | Company | Assets | From → to (years) | Effect, as reported |
|---|---|---|---|---|
| 2020-01-01 | Amazon | Servers | 3 → 4 | depreciation and amortization $2.7bn lower in 2020 |
| 2020-07-01 | Microsoft | Servers (network equipment 2 to 4 years) | 3 → 4 | operating income $2.7bn higher in FY2021 |
| 2021 | Meta | Selected cohorts of servers and network assets | 3 → 4 | not material, per Meta; done for selected cohorts in earlier years and in 2021 |
| 2021-01-01 | Alphabet | Servers (certain network equipment 3 to 5 years) | 3 → 4 | depreciation $2.6bn lower in 2021 |
| 2022-01-01 | Amazon | Servers (networking equipment 5 to 6 years) | 4 → 5 | depreciation and amortization $3.6bn lower in 2022 |
| 2022-04-01 | Meta | Majority of servers and network assets | 4 → 4.5 | then 5 years from Q4 2022 |
| 2022-06-01 | Oracle | Servers | 4 → 5 | operating expenses $434m lower in FY2023 |
| 2022-07-01 | Microsoft | Servers and network equipment | 4 → 6 | operating income $3.7bn higher in FY2023 |
| 2022-10-01 | Meta | Majority of servers and network assets | 4.5 → 5 | no full-year figure given in the 10-K |
| 2023-01-01 | Alphabet | Servers (certain network equipment 5 to 6 years) | 4 → 6 | depreciation $3.9bn lower in 2023 |
| 2024-01-01 | Amazon | Servers | 5 → 6 | depreciation and amortization $3.2bn lower in 2024 |
| 2024-06-01 | Oracle | Servers and networking equipment | 5 → 6 | operating expenses $733m lower in FY2025 |
| 2025-01-01 | Amazon | A subset of servers and networking equipment | 6 → 5 (shorter) | depreciation and amortization $1.4bn higher in 2025; Amazon cites the pace of AI and machine-learning technology |
| 2025-01-01 | Meta | Most servers and network assets | 5 → 5.5 | depreciation $2.92bn lower in 2025 |
| Company | Server life now | As of |
|---|---|---|
| Microsoft | 2 to 6 years | 2026-06-30 |
| Amazon | 5 to 6 years | 2025-12-31 |
| Alphabet | 6 years, generally | 2025-12-31 |
| Meta | 5 to 5.5 years | 2025-12-31 |
| Oracle | 6 years | 2026-05-31 |
The same test is applied to every company; Google (Alphabet) is reported on the same fields as the others.
Download CSV ↓Source: Company 10-K filings, SEC EDGAR · as of 2026-10-11 · effects are each company's own first-year figures; they differ in basis (depreciation, operating income or operating expenses) · Compiled by StackPath
Our reading. On these numbers AI is being added on top of the ordinary cloud, not cannibalising it, at least so far: ordinary server units rose and CPU revenue at Intel turned up. Cloud revenue growth sped up through 2026 too, but that is weaker evidence, because cloud revenue includes AI (GPU rental, AI models, Google's TPU sales) and no cloud reports AI separately; most new server spending now goes on AI servers. The cost is showing elsewhere: servers at cost on the balance sheets of Microsoft, Amazon, Meta and Oracle grew 58% in their latest year, and the depreciation that follows will grow with them. The same companies run large cloud data centres in Ireland, but none of the large AI sites Epoch tracks is there (see the AI race scorecard and AI compute added).
Segment revenue is as each company reports it; segments are redefined from time to time, and each quarter shows the latest filed figure. Microsoft Intelligent Cloud starts in fiscal 2024 (recast basis) and Intel's Data Center and AI in 2024 (recast basis). Microsoft Cloud is a revenue measure across segments, not a segment.
Questions people ask
- Is AI replacing traditional cloud computing?
- Not yet, but cloud revenue can't show it: AWS, Azure and Google Cloud revenue includes renting out GPUs and selling AI models, and none of them reports AI separately (AWS grew 37% and Google Cloud 82% in Q2 2026, SEC filings). The cleaner test is servers. IDC counted ordinary (non-accelerated) server units up 16.7% in Q2 2026, so ordinary computing is still growing, but servers with GPUs or other AI chips took 69% of server spending: AI is taking most of the new money.
- What share of servers are GPU servers?
- By value, 52.6% of the $166.3bn spent on servers worldwide in Q2 2026 went on GPU servers, and another $27.5bn on servers with other AI chips such as TPUs (IDC). By units the share is far smaller, because GPU servers cost many times more.
- How long do hyperscalers depreciate servers?
- Per their latest 10-Ks: Alphabet generally six years, Oracle six, Amazon five to six (it cut a subset from six to five years in 2025), Meta five to 5.5 (extended in 2025), Microsoft two to six years.
- How much hardware do the hyperscalers own?
- At gross cost, Microsoft held $216bn of servers, network equipment and software in June 2026, Amazon $173bn of servers and networking equipment and Meta $98bn of servers and network assets in December 2025 (10-K filings).