Spotlighting the idiotic canard that “legacy” tech companies can’t compete in the cloud, the market caps of seasoned citizens Oracle, SAP, and IBM have soared by $137 billion over the past two months of the AI Revolution while the market caps of presumptive AI leaders Alphabet and Microsoft tumbled $250 billion.
Now, market caps are of course fickle things over the short term, and I believe there’s no question that Alphabet and Microsoft will reverse those blips. On the Alphabet side, Google Cloud will continue to be the fastest-growing major cloud provider in the world for at least Q3 and quite possibly through the end of 2024 and has a powerful AI portfolio and story. And while Microsoft’s stranglehold on the #1 spot on the Cloud Wars Top 10 is loosening, Satya Nadella’s company is off to a fast start in all phases of AI.
At the same time, market caps also tell us a great deal about how the public views the growth potential of tech vendors and thus, this latest installment of my Cloud & AI Confidence Index reveals an enormous level of support for the growth prospects of three venerable Cloud Wars Top 10 stalwarts: 47-year-old Oracle, 52-year-old SAP, and 113-year-old IBM.
Over the past several years, how many times did various know-nothing pundits forecast the inevitable downfall of those three companies? How many times did ill-informed but click-hungry “experts” assure us that some wet-behind-the-ears database upstart was going to batter Oracle into irrelevance, or that some slick but niche-y app provider would backhand SAP into oblivion?
And yet, over the past two months, as the world has been bombarded with discussions of AI’s remarkable ascendancy and the emergence of AI agents and nuclear-powered AI data centers and the growing belief that the brave new world of multi-cloud will doom the inflexible, which members of the Cloud Wars Top 10 have received the biggest votes of confidence from investors since my last release of the Cloud & AI Confidence Index?
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That would be Oracle, SAP, and IBM. (Plus ServiceNow, but that’s a story — and an amazing one —for another time.)
As the table below shows, over the past two months Oracle’s market cap has jumped 19.2% to $459 billion, up $74 billion; SAP’s market cap has risen 14.2% to $281 billion, an increase of $35 billion; and IBM’s market cap has spiked by 15.9% to $201 billion, up $27.5 billion.
Here’s how the market caps for the entire Cloud Wars Top 10 have fared over that time:
CLOUD WARS “CLOUD & AI CONFIDENCE INDEX”
| Company | Sept. 23 mkt cap | July 18 mkt cap | Change |
| Microsoft | $3.22 trillion | $3.27 trillion | -$50B, -1.5% |
| Alphabet | $2.02 trillion | $2.24 trillion | -$200B, -10.9% |
| Oracle | $459 billion | $385 billion | +$74B, +19.2% |
| Amazon | $2.01 trillion | $1.94 trillion | +$70B, + 3.6% |
| SAP | $281 billion | $246 billion | +$35B, + 14.2% |
| ServiceNow | $194 billion | $153 billion | +$41B, +26.8% |
| Workday | $65.4 billion | $61.1 billion | +$4.3B, +7% |
| Salesforce | $253.7 billion | $242.6 billion | +$11.1B, +4.6% |
| IBM | $201.0 billion | $173.5 billion | +27.5B, +15.9% |
| Snowflake | $37.3 billion | $45.0 billion | -$7.7B, -17% |
| TOTAL | $8.74 trillion | $8.76 trillion | -$20B, -2.3% |
Final Thought
I recall a good line from an old cops-and-robbers series wherein a grizzled sergeant would say, “Just ’cause you stick yer boots in the oven, that don’t make ’em biscuits.” Now, that might not have anything to do with anything I’ve said today, but I think it gives us some slim reason to mull over our tendency to pigeonhole companies, whether suppliers or partners or customers or even ourselves.
And I think that’s a very bad habit — particularly here in the Cloud Wars.
Well done, Oracle and SAP and IBM (and ServiceNow)!!
