Amazon’s (NASDAQ:AMZN) cloud service, Amazon Web Services, is expected to accelerate to historic numbers this year due in part to its Bedrock offering and a growing demand for artificial intelligence, according to a survey by Mizuho Securities.
Mizuho’s quarterly AWS customer survey also discovered an uptick in executive business center meetings. These are where key decision makers within a company meet with AWS. These typically lead to solidified deals within 60 days compared to the standard sales cycle of 90 days.These types of meetings increased by 20% in the last month among survey respondents.
The Mizuho survey includes input from 300 Fortune 1000 companies.
The survey also discovered growth in proof of concepts for new use cases with Gen-AI across a range of industries. Financial services and insurance use cases increased 25% on automated customer service; healthcare cases jumped 75% for drug discovery; and manufacturing cases grew by 40% on real-time diagnostics on automobiles.
“These trends validate AWS’s Bedrock, a managed service to access to LLMs, including industry-leading Anthropic’s Claude 3,” said Mizuho’s James Lee in a note.
Clients also intend to spend larger budget shares on infrastructure. Such spending increased to 45% from 35%, according to respondents. Again, AI drove the acceleration.
“AWS customers are focusing on moving critical mass of data into the cloud for Gen-AI deployment long-term; and existing data in the cloud are upgraded to vectorized or unstructured data warehousing to optimize for Gen-AI,” Lee noted.
Due to these survey results, Mizuho reiterated its Buy rating on Amazon and its $230 price target. It still considers Amazon a “Top Pick.”
Other analysts are also noting AWS’ success.
“AWS has been growing at a robust rate and remains the leading cloud provider,” said Seeking Alpha analyst and contributor Envision Research. “AWS’ third-quarter sales increased 12% from year-ago levels and contributed operating income of $7B … Looking ahead, I see AWS results further improve from AMZN’s ongoing efforts to integrate artificial intelligence capabilities.”
Amazon holds a Buy rating from Seeking Alpha Analysts and Strong Buy rating from Wall Street analysts, while Seeking Alpha’s quant system rates it a Hold.