Synergy Research figures put Q1 cloud revenues at $129bn. Meanwhile, AWS, Microsoft and Google have 63% of the world market, which shows an acceleration delta of 13%The first quarter of 2026 marked a significant milestone in the world of cloud computing, with global revenues for cloud service providers soaring by $35 billion year-on-year to reach a staggering $129 billion. This data, provided by the US-based Synergy Research Group, takes into account the contributions of the industry’s giants, the hyperscalers – Amazon Web Services (AWS), Google Cloud, and Microsoft – as well as the tier two providers. These include the AI-focused neoclouds and a range of more general cloud providers.
The cloud market is experiencing a rapid acceleration, potentially driven by the increasing deployment of AI technologies. When comparing the run rate with the actual trailing 12-month revenues, it becomes clear that the first quarter of 2026 was the ninth consecutive quarter in which year-on-year growth increased, reaching an impressive 35%.
According to the data from Synergy, cloud service revenues have reached their highest growth rate since the fourth quarter of 2021, a time when the market was only 40% of its current size. This significant increase in revenues could be attributed to the transformative impact of AI on the cloud market.
The hyperscalers continue to dominate the market, with Amazon maintaining its top position. However, Microsoft and Google have achieved substantially higher growth rates, with their Q1 worldwide market shares standing at 28%, 21%, and 14% respectively. Among the tier two cloud providers, those experiencing the highest growth rates include CoreWeave, OpenAI, Oracle, Crusoe, Nebius, Anthropic, and ByteDance. Based on cloud infrastructure service revenues, five neocloud companies have now made their way into the top 30 cloud providers.
Synergy estimates that the quarterly cloud infrastructure service revenues were $128.6 billion, with trailing 12-month revenues reaching $455 billion. These figures include Infrastructure as a Service (IaaS), Platform as a Service (PaaS), and hosted private cloud services. With historical revenues of $455 billion and a run rate of $514.4 billion calculated from this year’s Q1, the $59.4 billion difference illustrates the rapid acceleration of the market, equating to an acceleration delta of 13%.
“The Q1 market is now fifteen times larger than it was a decade ago and continues to expand at 35% annually,” said John Dinsdale, chief analyst at Synergy Research Group. “Reaching a half-trillion-dollar run rate underscores the far-reaching impact of cloud computing and AI on the IT landscape.”
Dinsdale further predicts sustained strong growth in the years ahead, with AI continuing to drive usage, unlock new use cases, and boost cloud provider revenues. He also notes the evolving competitive landscape, with neoclouds playing an increasingly significant role, already accounting for 5% of the total cloud market and a substantially larger share of AI-focused segments.
Public IaaS and PaaS services account for the majority of the market, according to Synergy, and these grew by 38% in Q1. The dominance of the major cloud providers is even more pronounced in the public cloud, where the top three account for a significant portion of the market. This data underscores the transformative power of cloud computing and AI, and their profound impact on the IT landscape. As we move forward, we can expect these technologies to continue driving growth, innovation, and change in the cloud market.
