Cloud Wars Live with Bob Evans

In today's Cloud Wars Minute, I look at why playing to win — not playing it safe — is becoming the defining strategy for AI and cloud leaders.

Highlights

00:01 — Last week, we talked about Google Cloud's extraordinary Q2, with revenue up 82% to almost $25 billion, backlog up almost 400% to $514 billion. I wanted to talk today a little bit about a challenge that Google Cloud and the other hyperscalers are facing, because this extraordinary growth requires very aggressive investments in CapEx to build out data center capacity.

00:58 — Will these companies continue to have the courage to play to win, as opposed to trying to appease rattled investors? Right after Alphabet reported these numbers, Alphabet also had to say that its CapEx budget for 2026 is going to go up slightly to about $200 billion, while Q2 cash flow was negative $5.9 billion.

01:49 — But it's not a long-term trend here. The market reaction was they hammered Alphabet stock, and its market cap went down $250 billion after Google Cloud reported this. My point is, you've got to keep a clear head in these crazy sorts of times, and I think Alphabet is doing exactly that. Sundar Pichai cited immense opportunities during the Q2 earnings call and talked about the complete AI stack.

02:56 — They believe these investments they're making now are going to pay off with significantly more data center capacity next year. In the short term, Google Cloud is going to tap into some third-party data center capacity, Pichai said, as one of the ways to take care of customers. They're willing to trade that very short-term pain for enormous contracts down the line.

04:09 — It's a wild time here, but definitely, as I've said many times, this is the greatest growth market the world has ever known. These big hyperscaler companies are now faced with challenges that no company has ever had to face before. I applaud the Alphabet leadership for playing to win rather than playing not to lose. That's just not going to cut it in the Cloud Wars.

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In today's Cloud Wars Minute, I explain how Salesforce's latest MCP announcement advances Marc Benioff's vision for AI-first enterprise collaboration.

Highlights

00:03 — Salesforce has announced the introduction of new MCP servers that connect Slack to Salesforce CRM, Tableau, Data 360, and third-party AI tools. Now, these new servers have enhanced Slackbot, which is Slack's personal AI agent, enabling it to serve as a conversational interface for tasks across the Salesforce ecosystem.

00:29 — The headline for the press release about this announcement really summarizes it very well: "Slackbot can now do anything Salesforce can — just ask." Salesforce users can now view and update Salesforce records, run automations, access custom data without leaving Slack, and just using natural language. Users can query Tableau dashboards and analytics.

00:55 — Data 360 integration now enables Slackbot to access customer data for better responses and context-aware responses. Slackbot can now orchestrate work across multiple AI agents and enterprise apps, including partners like Anthropic, Atlassian, DocuSign, and Zapier. And the whole thing can be centrally managed by admins with built-in authentication and security.

01:22 — These Salesforce-hosted MCP servers are now generally available for all Enterprise Edition organizations and above. So what's the vision here? Well, Kris Billmaier, EVP and GM of Sales Cloud, explained, "Salesforce Sales Cloud in Slack is the future of how revenue teams work," he said.

01:55 — "AI is changing what it means to sell, and putting Salesforce intelligence and data inside Slack, where sellers already live, means teams stop chasing context and start driving growth. That shift is happening now, and we're right at the center of it." Ultimately, Salesforce is now positioning Slack as the primary workspace for AI-powered collaboration.

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In today's Cloud Wars Minute, I show why Google Cloud is setting the pace in the AI economy despite Microsoft's and AWS's larger scale.

Highlights

00:03 — Well, we thought we had seen some big numbers in the Cloud Wars over the last few quarters, but Google Cloud for Q2 absolutely blew the numbers away. Astonishing: revenue up 82% to almost $25 billion, and its backlog up 390% to $514 billion.

01:39 — From Q1 to Q2, Google Cloud's revenue jumped $4.8 billion. That's far larger, not only than what Google Cloud has done quarter to quarter, but Microsoft and AWS. I believe, looking pretty closely over a long period of time, for any of those companies to have a $3 billion increase quarter to quarter has been remarkable.

02:16 — I've got an article offering some highlights from this, and also side-by-side-by-side comparisons of the growth that Google Cloud, Microsoft Cloud, and AWS have each posted over the past five quarters. What makes Google Cloud stand out is the arc of its acceleration. It is much, much steeper, much higher.

03:18 — Q4, Google Cloud really broke away from the pack: 48% growth in Q4, 63% growth in Q1, and here now for Q2, 82%. Just absolutely remarkable, and I think we see that among the hyperscalers, and perhaps others as well, Google Cloud is clearly the AI leader.

04:32 — While Microsoft Cloud and AWS have bigger revenue numbers, Google Cloud is the one setting the pace, winning more customers, winning new business, and setting the pace with technology, go-to-market innovation, and the confidence, in large part delivered by the remarkable security business it's built, that it can handle everything that customers need as they move into the AI economy.

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In today's Cloud Wars Minute, I look at how Microsoft is helping schools move from AI experimentation to effective deployment.

Highlights

00:08 — There isn't a sector that AI hasn't impacted, and with the proliferation of these technologies, it's important to examine individual sectors and analyze the effect of AI on them, both positive and negative.

00:23 — To understand where things are working and where they aren't. And that's what Microsoft has done with its 2026 "AI in Education" report. I want to share some of the key findings from that report with you today. Ultimately, AI has become mainstream in education, with 92% of students and education leaders, and 88% of educators, having used AI for school-related purposes.

00:60 — Adoption is increasing. In fact, 58% of education leaders report that their institutions are already implementing or scaling AI initiatives. According to the report, the biggest gap identified is the need for training, with both educators and students requesting more structured support. In fact, 66% of educators want AI training on a monthly or quarterly basis.

01:15 — While 52% of students are also seeking regular AI training. The priority highlighted in the report is responsible AI use, with 41% of students and 42% of educators citing academic integrity as a leading concern. Now, in response, Microsoft has announced new AI capabilities across Microsoft 365 Education and its broad education platform.

01:40 — These include AI-assisted unit planning for teachers, student AI guidelines, learning groups, enhanced classroom experiences in the Learning Zone, Copilot Notebooks, and a Study and Learn agent in Copilot Chat. The overall message from this research is that the focus in education is shifting from access to AI to its responsible deployment, with improvements needed in training, governance, and classroom-ready tools.

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In today's Cloud Wars Minute, I examine why Google Cloud and Palantir have become the fastest-growing companies in enterprise AI.

Highlights

00:01 — Now that we are more than halfway through the year, we've got Q2 earnings season coming up, and a couple that I'm looking for in particular are Google Cloud and Palantir because their growth rates have been so much above the norm. I think what we see in those growth rates and in the numbers behind those is a reflection of what customers really want from AI and the cloud here in the AI revolution.

00:52 — Let's look at numbers for Google Cloud, the number one company on the Cloud Wars Top 10. Palantir is number five. For Google Cloud, in the quarter ended a few months ago, March 31, its growth rate was 63%. Its revenue was $20 billion. Q4: 48%, $17.7 billion. Going back to Q3: 34%, Q2: 32%, and Q1: 28%. So we see, for the last five quarters, Google Cloud has soared over the last couple of quarters

01:57 — Now let's look at Palantir with those same five quarters, going back to Q1 of 2025, and up through Q1 of this year. So, most recently, 85% growth rate with over $1.6 billion in revenue, 70% before that, 63% before that, 48%, 39%. So in both cases, we see the company, even as its revenue base gets bigger, growing much, much faster moving forward.

03:22 — Palantir is 24 years old. This is not a startup company, although it's just sort of burst onto the scene. I wonder if, in some ways, Palantir's technology was out ahead of where the market was. But now that the AI boom has swept the world, Palantir's technologies are now suitable for  companies of any size to help take what they have and use that as a foundation to build into the future.

04:37 — Innovation in going to market, as well as in technology, means  some new approaches to things. I think particularly Google Cloud here has been an extraordinary example of this. And I refer in this article to their recent disclosure that while OpenAI and Anthropic, AWS, and Microsoft are all launching deployment units to pull off these big AI projects, Google Cloud is relying 100% on its ecosystem.

05:11 — I'll be eager to see how these companies do in Q2, and we'll follow up with those and the other Cloud Wars Top 10 companies on how they've done in calendar Q2. But I really take my hat off to Google Cloud and Palantir because, in this very intense time, with an enormous market and everybody going after it, their growth rates are soaring.

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