Boeing Partners With Microsoft, Amazon, Google in the Cloud – Barron’s

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Boeing has selected the companies that will help it to move some of its business processes from data centers into the cloud, just as many other businesses are doing.

Boeing (ticker: BA) said Wednesday that it had awarded new business to three of the major cloud players: Googles parent Alphabet (GOOGL), Amazon.com (AMZN), and Microsoft (MSFT).

Boeing will shift hundreds of business applications, previously managed in Boeing data centers, to Google cloud, making it possible for it to use Googles analytic tools.

The commercial aerospace giant will use Amazon s Amazon Web Services to strengthen its engineering and manufacturing processes. Boeing also awarded business to Microsoft to leverage the Microsoft Cloud and its [artificial intelligence] capabilities to update its technology infrastructure and mission-critical applications with intelligent new solutions that are data driven, it said.

All three news releases describing the deals read similarly. There appears to be enough cloud business to go around. Research firm Gartner estimates that more than half of IT spending will migrate to the cloud by 2025. That amounts to roughly $2.9 trillion in spending over the next four years.

That is a huge sum, but the announcements dont appear to be stock-moving events. Boeing shares were down 1.9% in early trading, while the S&P 500 and Dow Jones Industrial Average had fallen about 1.2% and 0.7%, respectively.

Microsoft, Amazon, and Alphabet shares were off 3%, 3.5% and 2.5%, respectively.

Shares are weak for a second day following hawkish comments from Federal Reserve Gov. Lael Brainard.Ina Tuesday speech, Brainard said it is of paramount importance to get inflation down. That means higher interest rates and less monetary stimulus.

Coming into Wednesday trading, Boeing stock was down about 9% year to date. That stock is still being driven by Covid-19which affects global air traffic, and thus demand for jetsand the 737 MAX. The MAX was grounded worldwide between March 2019 and November 2020 following two deadly crashes inside of five months, forcing the company to stop delivering the planes to buyers. Boeings earnings and cash flow are set to recover as MAX deliveries pick up relative to 2021 this year.

Coming into Wednesday trading, Microsoft, Amazon and Alphabet shares were down about 7%, 2% and 3% year to date.

Write to Al Root at allen.root@dowjones.com

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Boeing Partners With Microsoft, Amazon, Google in the Cloud - Barron's