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As artificial intelligence (AI) becomes a key demand driver for cloud investment, Amazon Web Services (AWS), Microsoft Azure and Google Cloud collectively grew by 24 per cent, accounting for 66 per cent of total spending in the first quarter (January-March) period.

Tech giant Microsoft outpaced both AWS and Google Cloud, with sales rising by 31 per cent (year-on-year), nearly double the AWS’s growth rate of 17 per cent, while Google Cloud grew 28 per cent YoY, according to global market research firm Canalys.

The report mentioned that despite holding the largest market share at 31 per cent, AWS faces increasing competition from its fast-growing competitors.

Microsoft Azure was second with a market share of 25 per cent and Google Cloud was third, with a market share of 10 per cent in the first quarter this year,

Earlier this month, the Amazon-run company announced the departure of its CEO Adam Selipsky after three years in the role. Matt Garman will become CEO of AWS, effective June 3.

Yi Zhang, an analyst at Canalys, said that Microsoft's end-to-end portfolio is proving to be a strong "competitive moat", while Google's strength in AI is giving it a strong tailwind.

As enterprises embrace AI-driven initiatives, there is a potential need to transfer their workloads and data to cloud platforms to avail themselves of essential computing and storage capacities, the report mentioned.

Meanwhile, global cloud infrastructure services expenditure grew by 21 per cent in the first quarter to reach $79.8 billion, an increase of $13.4 billion YoY.