For years Google has been playing catch-up in the cloud infrastructure market, with the US in third place behind Amazon and Microsoft. Investors' challenge is the absence of comparable statistics from Amazon and Microsoft on cloud infrastructure.

According to a Google employee estimate based on a leaked Microsoft document and some extrapolation of other market statistics, Google believes it's closer to second place than what most analysts believe.

A Google document estimates that Microsoft generated under $29 billion in Azure revenue in the latest fiscal year, a significant margin lower than what Wall Street analysts predicted. Bank of America was the most optimistic, predicting Azure would make $37.5 billion in fiscal 2022. Cowen predicted $33.9 billion and UBS predicted $32.3 billion.

Google has Microsoft ending the 2022 fiscal year with an operating loss of nearly $3 billion, down from a loss of more than $5 billion the previous year. It states that Azure's sales and marketing costs amounted to nearly $10 billion, or 34% of the business's overall sales and marketing expenditure.

Microsoft stated that total sales and marketing expenses exceeded 11% of the company's overall revenues for that timeframe. Google's bottom-line numbers were dismissed by one analyst.

Microsoft is off only a -10% margin, said Derrick Wood, an analyst at Cowen who has the equivalent of a buy rating on Microsoft stock. His research shows Azure has an operating margin higher than 30%, compared to Google's estimate of a -10% margin.

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