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Google Cloud worth US$225 billion, Deutsche Bank says
[LONDON] Alphabet Inc's cloud business alone is now worth US$225 billion, Deutsche Bank analysts led by Lloyd Walmsley wrote in a note.
The unit could report compound annual growth of 55 per cent between 2018 and 2022, and reach annual sales of about US$38 billion by 2025, the analysts wrote.
"While Google Cloud has been lagging behind in the market and burning money historically, with increased confidence in the go-to-market and commercial traction under Mr. Kurian, we think it can grow market share," they wrote. Former Oracle executive Thomas Kurian was named head of the division in November.
The value ascribed by Deutsche Bank to Google Cloud is nearly twice the market value of IBM, which reported cloud revenue of US$19.2 billion in 2018, at the close of trading on Wednesday, Bloomberg data show.
Deutsche Bank, which has a "buy" rating on Alphabet, raised its price target on the company to US$1,600 a share, higher than any of the 45 analysts surveyed by Bloomberg. Alphabet shares were up 0.2 per cent to US$1,180 a share in pre-market trading.