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OVHcloud Shares Plunge After 2026 Outlook Disappoints Despite Record €1 Billion Revenue

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OVHcloud (OVH.PA), Europe’s largest cloud provider, celebrated a major milestone on Tuesday as annual revenue surpassed €1 billion for the first time — yet its weaker-than-expected 2026 forecast sent investors fleeing. Shares plunged 18% by mid-morning, marking what could become the company’s biggest single-day drop ever if losses persist.

The firm reported 9.3% revenue growth for fiscal 2025, reaching €1.08 billion, with an EBITDA margin of 40.4%. However, its 2026 outlook disappointed the market: OVHcloud now expects organic revenue growth of just 5–7%, well below analyst projections of around 10%, according to Stifel and J.P. Morgan.

In response, the company pledged to improve profitability by targeting a higher core profit margin while maintaining capital expenditures at 30–32% of revenue to bolster its Webcloud segment. The results come as founder Octave Klaba returns as CEO, merging his chairman role to lead the company’s next phase of expansion. Klaba, who owns more than 80% of OVHcloud, previously served as CEO until 2018.

Klaba said the firm will focus on meeting rising AI-driven cloud demand and promoting European digital independence amid global tech rivalries. OVHcloud continues to expand globally, citing growing client bases in Canada, Singapore, and India, while remaining a key competitor to Amazon Web Services, Microsoft Azure, and Google Cloud.

By segment, Private Cloud accounted for 62% of sales, growing 8.5%, Public Cloud rose 17.5% (20% of revenue), and Webcloud increased 3.7% (18% of total). OVHcloud serves 1.6 million clients, including 1,200 enterprise customers generating over €100,000 in annual recurring revenue.

Amazon Cloud Outage Disrupts Global Online Services, Gradual Recovery Underway

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Amazon’s cloud computing giant, Amazon Web Services (AWS), faced a major outage on Monday that disrupted numerous online platforms — from banking and social media services to business applications worldwide. Although the system is slowly recovering, the incident underscored how dependent the modern digital ecosystem is on AWS’s infrastructure.

According to Amazon, the disruption was triggered by a Domain Name System (DNS) failure that prevented applications from locating the correct address for DynamoDB — a key database service used to store user data and other critical information. The DNS essentially functions as the internet’s phone book, converting domain names into numerical IP addresses. Without it, apps could not reach the required servers.

The root of the issue was traced to AWS’s Elastic Compute Cloud (EC2) network in the US-EAST-1 region, located in northern Virginia — one of the company’s most frequently used and default data centers. This region has been the source of several previous incidents, including a 2023 capacity issue that affected AWS Lambda services and a 2021 congestion event that paralyzed popular tools like Ring, Chime, and iRobot devices.

Despite the recent disruption, AWS continues to dominate the cloud market, reporting a revenue of $30.9 billion in the second quarter of this year — an 18% increase compared to the previous year. The event, however, has reignited discussions about the fragility of centralized cloud infrastructures and the global ripple effects of regional failures.

ABB CEO says data center demand for AI power will keep growing for years

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Swiss engineering giant ABB remains highly optimistic about the long-term growth of data centers driven by the global artificial intelligence boom, CEO Morten Wierod told Reuters on Thursday.

Wierod said ABB has seen double-digit growth this year in orders for its electrification products, which include switchgear and uninterruptible power systems that ensure servers stay online. “Over the next five years I am very confident about demand from data centers,” he said.

Rejecting suggestions of an AI bubble, Wierod argued that the challenge lies in construction capacity, not in demand. “We are talking about trillions in investment, but there are not enough people and resources to build all this,” he noted.

AI remains in its early stages, he added, meaning continued expansion of data infrastructure as more companies — beyond the tech giants — invest in new facilities. Data centers accounted for about 7% of ABB’s revenue in 2025, up from 6% the previous year.

Earlier this week, ABB announced a partnership with Nvidia to develop new electrification systems for next-generation chips used in high-performance computing centers. “That’s not for 2025 or 2026, it’s a long-term investment,” Wierod said.

He also highlighted growing opportunities in retrofitting and upgrading older data centers to handle the increased power demands of modern AI systems. “That is a big opportunity,” he said.