Google Cloud CEO Thomas Kurian paints a rosy picture for the cloud service provider. During a Goldman Sachs technology conference in San Francisco, he said that the company has approximately $106 billion in contracts outstanding. According to him, more than half of that can be converted into revenue in the next two years.
In the second quarter of 2025, parent company Alphabet reported $13.6 billion in revenue for Google Cloud, an increase of 32 percent over the previous year. If the forecast is correct, according to The Register, this means that the cloud service provider could add around $53 billion in additional revenue by 2027.
Google Cloud’s market position is often compared to that of its biggest rivals. Microsoft reported annual revenue of $75 billion for Azure this year, while AWS recorded $30.9 billion in the same quarter, a growth of 17.5 percent.
Faster transition to the cloud
Kurian emphasized that many companies still run IT systems on-premises. He expects the transition to the cloud to accelerate, with artificial intelligence playing a decisive role. Increasingly, customers are looking for suppliers who can help transform their business operations with AI applications, rather than just hosting services.
Google claims to have an advantage in this regard thanks to its own investments in AI infrastructure. Its systems are said to be more energy-efficient and deliver more computing power than those of its competitors. According to Kurian, the storage and network are also designed in such a way that they can easily switch from training to inference.
For investors, the most important thing is how AI is converted into revenue. Kurian mentioned usage-based rates, subscriptions, and value-based models, such as paying per saved service request or higher ad conversions. In addition, AI use leads to increased purchases of security and data services.
According to Kurian, 65 percent of customers now use Google Cloud AI tools. On average, this group purchases more products than organizations that do not yet use AI. Examples of applications include digital product development, customer service, back-office processes, and IT support. For example, Google helped Warner Bros. re-edit The Wizard of Oz for the Las Vegas Sphere, and Home Depot uses AI to answer HR questions more quickly.
Kurian’s message: cloud infrastructure only becomes truly profitable when companies purchase AI services on top of it. With this, Google Cloud wants to position itself firmly in the next phase of the cloud market.