Taking on mega-giants such as Amazon (NASDAQ:$AMZN), Microsoft (NASDAQ:$MSFT), and Alphabet Inc. (NASDAQ:$GOOG), Alibaba Group Holdings (NASDAQ:$BABA) entered the cloud computing industry as an underdog. But the company’s rising profile is hard to ignore.

The cloud computing industry is expected to reach $246.8 billion by the end of 2017, before expanding to $383.4 billion by 2020. If Alibaba does it right, Cloud revenues could transform the company’s financial profile. So far? In a fiscal 1Q18 that ended in June, 2017, Alibaba singled out cloud computing within its revenue growth drivers. Much like its competitors, Alibaba prioritized growth over profitability.

Let’s take a closer look:

• Alibaba’s cloud product goes by Aliyun and AliCloud
• Cloud contributed 5.% to Alibaba’s overall revenues in the quarter
• That translated to $359 million million in fiscal 1Q18, seeing a 96% increase from fiscal 1Q17
• This number is projected to continue growing
• Alibaba recently launched several new products, including Cloud Storage Gateway and Lightning Cube that simplifies and accelerates migration from on-premise data centers to the cloud environment
• As a result, ARPU (average revenue per user) has increased

Alibaba surpassed 1 million paying cloud customers after adding 137,000 customers in fiscal 1Q18. If the company sustains momentum, it will shed its underdog identity to be a tough competitor within the saturated cloud computing sector.

Featured Image: twitter