Cloud computing is making transformational changes in business practices. Organizations can concentrate more on innovation in technology and operational strategy by freeing up IT resources, which eventually leads to revenue growth..
The developmental direction of industry-specific cloud stages is anticipated to get an extra boost from the appropriation of GenAI. Open cloud benefit suppliers are in a favourable position to collaborate and encourage the mindful and custom-made integration of GenAI.
Australia's open cloud administrations are poised for a noteworthy rise, anticipated to surge to AU$23.2 billion by 2024, a strong 19.3% increment from the past year.
The Australian government is currently trending towards AI implementations. The media reported on 16 November 2023, that the Australian government's decision to explore the safe and responsible use of generative artificial intelligence (AI) in the public service in partnership with Microsoft through the Digital Transformation Agency (DTA).
The cloud advertising is forecast to experience a significant extension. Infrastructure-as-a-Service (IaaS) is poised to lead the way with an amazing growth rate of 24.6%, closely followed by Platform-as-a-Service (PaaS) at 22.7%. Eminently, all portions of the cloud advertising are anticipated to involve positive development patterns in 2024.
These insights emphasize the energetic advancement and expanding importance of different cloud benefit portions inside the Australian showcase, meaning a considerable move towards cloud-based arrangements and advances over businesses.
This information highlights the strong progress and growing importance of different parts of the cloud benefits in the Australian rollout, signifying a significant shift towards solutions and advancements in cloud-based-related businesses.
Factors that are influencing the growth of cloud computing are: rising demand for AI and industry cloud platforms; an anticipated industry shift towards cloud platforms; and end user spending growth.
Reference: *All Data has been sourced from Company announcements and Refinitiv, Thomson Reuters, Australian government.
Certain technology companies are strongly interested in providing cloud computing services in Australia. Let’s look at them:
[Note]: The market cap and the share price of the selected ASX companies below are mentioned as of 3 December 2023.
NEXTDC Limited (ASX: NXT)
Market Cap: $6.97 billion
CMP: $13.54
The company is exploring digital growth opportunities in the Asia-Pacific region. Developments are currently underway in Kuala Lumpur and Auckland, representing important new frontiers for the company. Currently, significant activities are underway to contract Malaysia's first Tier IV-certified colocation data centre, with Phase 1 to open in the first half of FY26. Other new projects, such as A1 in Adelaide, are to establish a national hub, which is expected to open in the first half of 2024, adding around 5 MW of planned power capacity to the Adelaide and Darwin markets.
Macquarie Technology Group Limited (ASX: MAQ)
Market Cap: $1.63 billion
CMP: $66.915
Macquarie holds significant monetary value as an investment based on a range of factors and metrics that demonstrate well-balanced overall health and capacity, and we expect this to continue for many years to come. Steady and consistent revenue growth coupled with a significant increase in profits suggests the possibility of the same thing happening again in the future. The company also has quite diverse operations across many segments, with the data centre business having strong potential to become the main focus and revenue source in the long term. The company also holds an impeccable ESG record as it continues its initiatives towards environmental goals, focuses on social welfare by enhancing employment, and is also fully compliant with regulations. This eliminates social and political risks while ensuring high market value.
Reckon Limited (ASX: RKN)
Market Cap: $1.63 billion
CMP: $66.915
Reckon Limited has been experiencing a very stable rise in their revenues, which can be attributed to their increased market presence in the SME segment and their exceptional growth in their Legal Division. Sustained profitability helps boost this growth further. Reckon’s performance reflects that it was delivering on its plan, which is to continue generating stable cash flows from its well-established business group. It has thus enabled the flexibility to invest in high-growth opportunities.
Frequently Asked Questions (F.A.Q)
Is there any demand for cloud computing in Australia?
The use of cloud computing is growing rapidly due to strong industrial growth, and with that, the need for expertise in virtualization, cloud infrastructure, application development, and security has also increased.
Name the leading ASX companies involved in the cloud computing sector in Australia.
• NEXTDC Limited (ASX: NXT)
• Reckon Limited (ASX: RKN)
• Macquarie Technology Group Limited (ASX: MAQ)
• Archtis Ltd. (ASX: AR9)
• FELIX Group Holdings Ltd. (ASX: FLX)
What are the most popular cloud applications in Australia?
Popular clouds in Australia include AWS, Azure, IBM, Google, Alibaba Cloud, and Oracle, with AWS and Azure leading the way.
Veye Pty Ltd(ABN 58 623 120 865), holds (AFSL No. 523157 ). All information provided by Veye Pty Ltd through its website, reports, and newsletters is general financial product advice only and should not be considered a personal recommendation to buy or sell any asset or security. Before acting on the advice, you should consider whether it’s appropriate to you, in light of your objectives, financial situation, or needs. You should look at the Product Disclosure Statement or other offer document associated with the security or product before making a decision on acquiring the security or product. You can refer to our Terms & Conditions and Financial Services Guide for more information. Any recommendation contained herein may not be suitable for all investors as it does not take into account your personal financial needs or investment objectives. Although Veye takes the utmost care to ensure accuracy of the content and that the information is gathered and processed from reliable resources, we strongly recommend that you seek professional advice from your financial advisor or stockbroker before making any investment decision based on any of our recommendations. All the information we share represents our views on the date of publishing as stocks are subject to real time changes and therefore may change without notice. Please remember that investments can go up and down and past performance is not necessarily indicative of future returns. We request our readers not to interpret our reports as direct recommendations. To the extent permitted by law, Veye Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss, or data corruption) (as mentioned on the website www.veye.com.au), and confirms that the employees and/or associates of Veye Pty Ltd do not hold positions in any of the financial products covered on the website on the date of publishing this report. Veye Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services.