The slowdown has come for the cloud business

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Wednesday, Oct., 26 2022

Even cloud giants like Microsoft can’t avoid the economic slowdown

The economic slowdown has come for tech companies’ big cash cows: the cloud businesses that provide their clients with inexpensive computing power and applications.

On Tuesday, Microsoft (MSFT) reported that its all-important Azure cloud division will see slower growth than it is expected this quarter. The same day, Google parent Alphabet (GOOG, GOOGL) reported that its Google Cloud Platform growth slowed from 44% in the third quarter 2021 to 37% in the third quarter.

Amazon (AMZN) is expected to report 33% growth in its AWS segment when it announces its earnings Oct. 27. That would mark a drop from the 39% growth it saw in the same quarter last year.

“We’re seeing some budgetary pressure on the enterprise side,” Piper Sandler equity research analyst Brent Bracelin told Yahoo Finance. “We certainly wouldn’t say enterprise software, cloud is immune from the macro and we’re starting to see cracks.”

Cloud growth had been meteoric through the pandemic. Its slowdown means companies across various sectors are cutting budgets and looking for ways to save amid near-record inflation, rising interest rates, and recession fears. Those cuts are hitting Big Tech where it hurts.

The cloud is facing a huge test

Cloud computing services generally help companies

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Des Moines business stolen from less than week after large fire

In another blow to a Des Moines business, the owners of Busy Bubbles Laundry at 31st Street and Ingersoll tell us they were stolen from recently. Busy Bubbles Laundry caught on fire last Wednesday night. Firefighters rushed out to the scene. Everybody made it out of the laundromat safely. “Our gal that was working that night called and was frantic and said, ‘the place is on fire’. I was like ‘What?’ and she said ‘It’s the biggest fire I’d ever seen’,” said Virgil Hochstetler, one of the owners of Busy Bubbles Laundry. Virgil and his wife Karen have owned Busy Bubbles Laundry for more than 12 years. Never did they see themselves here. The Hochstetlers say they lost almost everything in the fire. “The only thing that wasn’t lost is our pet wash,” Virgil said. Then on Tuesday, not even a week after the fire, the Hochstetlers were shocked by what they found. The Hochstetlers tell KCCI someone had broken in and pried open a door leading to their pet wash.”They stole the soaps, the dog treats that we had in there, and broke into the money box and took what little money was in there,” Virgil said. “Somebody pooped on the floor, just to rub it in I think.” “It’s a disgusting thing on a good day and to basically just kick a person when they’re down, it’s just rude,” Karen said. The Hochstetlers say they didn’t report the burglary to police. “It’s a pretty minor loss in the … Read More

Caterer Sodexo sees rebound in 2023 to pre-pandemic levels

Oct 26 (Reuters) – Sodexo (EXHO.PA) on Wednesday said it expected 2023 revenue and profit margins to hit 2019 levels, as the French catering and food services group rebounds from the pandemic and increases prices to cope with rising food and energy bills .

The outlook reflects the relatively swift recovery by the catering industry this year as major sports events have restarted, shops have reopened and more people returned to offices after coronavirus restrictions eased.

The company also reported better-than-expected full-year revenue, driven by all-time-high client retention rate and strong new business growth, despite the inflationary backdrop.

The Paris-based firm posted annual revenue of 21.13 billion euros ($21.06 billion), compared with 20.73 billion euros forecast by analysts polled by the company.

Sodexo, which serves businesses, armed forces, hospitals, schools and events, said revenue of its main On-site Services unit reached 99% of its 2019 levels the fourth quarter.

Pointing to the unit’s return to pre-pandemic levels, the group now expects revenues and margins for 2023 to return to 2019 levels.

For 2023, Sodexo forecasts organic revenue growth of between 8% and 10%, driven by further progress in new business and inflation, and underlying operating profit margin around 30%.

Its benefits and rewards services unit is expected to report underlying operating profit margin of around 30% at constant rates next year, the company said, giving a forecast for the division for the first time.

The voucher business has benefited this year from companies improving employee benefits through vouchers for food

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