The cloud-based market is flourishing due to the increasing prevalence of hybrid work trends, intrinsic efficiency, and rising expenditure on cloud services. This advancement in cloud technology is driving a widespread digital transformation across various industries and businesses globally. Consequently, investors may find significant opportunities in acquiring shares of strong, fundamentally sound cloud-based solutions stocks such as Atlassian Corporation (TEAM), Autodesk, Inc. (ADSK), and Okta, Inc. (OKTA), which are all positioned for substantial growth.
Cloud-based services form a crucial part of the broader cloud computing ecosystem. With their enhanced speed, cost-efficiency, scalability, and security, cloud computing services have become the preferred choice for many organizations. Additionally, the growing popularity of remote and hybrid work arrangements has significantly boosted the adoption of these services. These features are especially appealing to businesses aiming to streamline operations and reduce overhead costs while ensuring data security and compliance.
The cloud computing market is witnessing substantial investment and popularity across various sectors, positioning it on a trajectory for notable success. Gartner (IT) predicts that global end-user spending on public cloud services will reach $723.40 billion by 2025, a notable increase from $595.70 billion in 2024, underscoring the market’s expansive growth potential. Furthermore, a report by Fortune Business Insights projects that the cloud computing market will hit $2.29 trillion by 2032, growing at an impressive compound annual growth rate (CAGR) of 16.5%.
Atlassian Corporation (TEAM)
Strategic Collaborations and Product Offerings
Atlassian Corporation, headquartered in Sydney, Australia, specializes in designing, developing, licensing, and maintaining an array of software products. Its notable offerings include Jira, a project management system; Confluence, a collaborative workspace solution; Loom, an asynchronous video communication tool; and Trello, designed to streamline dynamic workflows. Such diverse and well-regarded products have established Atlassian as a leader in the software application industry.
On December 4, 2024, Atlassian announced a strategic multi-year collaboration with Amazon Web Services (AWS) to accelerate cloud transformation and enhance AI and security capabilities for enterprise customers. This partnership could spur user growth for Atlassian Cloud, which provides users access to the latest cloud-enabled services combined with robust security, privacy, compliance, and reliability. The collaboration aims to integrate AWS’s state-of-the-art infrastructure with Atlassian’s highly effective software solutions, thereby providing unparalleled services to enterprises worldwide.
Financial Performance and Market Position
In the fiscal first quarter of 2025, which ended on September 30, 2024, Atlassian reported a 21.5% year-over-year increase in total revenues, reaching $1.19 billion. Its non-GAAP operating income grew 19.2% year-over-year, totaling $268.05 million. The company’s non-GAAP net income rose 18.2% year-over-year to $199.70 million, while its non-GAAP net income per share increased by 18.5%, hitting $0.77. This solid financial performance reflects Atlassian’s ability to adapt and thrive in a rapidly evolving digital landscape.
Analysts forecast Atlassian’s revenue and EPS for the fiscal second quarter of 2025 (ended December 2024) to increase by 17% and 3.5% year-over-year respectively, amounting to $1.24 billion and $0.76. Notably, Atlassian has exceeded consensus revenue and EPS estimates in each of the past four quarters. This consistent outperformance underscores the company’s strong market position and operational efficiency, making it an attractive choice for investors seeking exposure to the burgeoning cloud-based services sector.
Autodesk, Inc. (ADSK)
Innovative Acquisitions and Product Expansion
Autodesk is known for its 3D design, engineering, and entertainment technology solutions. Its array of software includes AutoCAD Civil 3D for surveying and design, Revit for Building Information Modeling, and Autodesk BIM Collaborate Pro, a cloud-based tool for design collaboration and management, among other innovative products. This broad suite of tools has cemented Autodesk’s reputation as a pioneer in design and engineering software, catering to a diverse set of industries.
On May 21, 2024, Autodesk announced the acquisition of Wonder Dynamics, developers of Wonder Studio, a cloud-based 3D animation and visual effects (VFX) solution that integrates artificial intelligence (AI) with traditional tools. This acquisition is anticipated to enable Autodesk users to incorporate 3D animated characters into their projects while reducing the learning curve and automating traditionally complex processes. The integration of AI with VFX will likely enhance user experience and expand the capabilities of Autodesk’s software offerings.
Financial Growth and Market Performance
During the fiscal third quarter of 2025, ending October 31, 2024, Autodesk reported an 11% year-over-year rise in total net revenue, reaching $1.57 billion. Its non-GAAP operating income rose by 4.8% year-over-year to $573 million. Additionally, Autodesk’s net income increased by 14.1% year-over-year, totaling $275 million, while its non-GAAP net income per share grew by 4.8%, reaching $2.17. These strong financial metrics indicate Autodesk’s ability to generate consistent and healthy profits, affirming its market leadership.
The consensus revenue and EPS estimates for the fiscal fourth quarter of 2025 (ending January 2025) show an expected year-over-year rise of 11.1% and 2.3% respectively, amounting to $1.63 billion and $2.14. Autodesk has exceeded consensus revenue and EPS estimates in all four previous quarters. This consistent track record of surpassing market expectations highlights the company’s robust operational execution and strategic foresight, making it a compelling investment opportunity.
Okta, Inc. (OKTA)
New Product Launches and Industry Collaborations
Okta specializes in managing and securing identities with products and services such as single sign-on, adaptive multi-factor authentication, API access management, access gateway, and Okta device access. The company’s focus on identity management is pivotal in today’s digital age, where secure access to information and systems is paramount for organizations worldwide.
On October 16, Okta announced a new product, Customer Identity Cloud, aimed at helping developers and organizations secure identity in GenAI applications through secure identity standards. With the expanding GenAI market, this new offering could bolster Okta’s market position and drive user growth. The introduction of this innovative solution demonstrates Okta’s commitment to staying at the forefront of identity management and its ability to adapt to emerging technological trends.
Additionally, on the same day, Okta, along with the OpenID Foundation, announced the formation of an OpenID Foundation working group with partners such as Ping Identity, Microsoft Corporation, SGNL, and Beyond Identity. This group aims to establish a new identity security standard, the Interoperability Profile for Secure Identity in the Enterprise (IPSIE). The new security standard is expected to enhance the end-to-end security of the companies’ products across all touchpoints of the technology stack.
Financial Gains and Market Standing
During the fiscal third quarter of 2025, ending October 31, 2024, Okta reported a 13.9% year-over-year increase in total revenue, reaching $665 million. Its non-GAAP operating income grew by 62.4% year-over-year, totaling $138 million. Furthermore, Okta’s non-GAAP net income rose by 53.2% year-over-year, amounting to $121 million, while its non-GAAP net income per share increased by 52.3%, hitting $0.67. These impressive financial results reflect Okta’s strong market position and its ability to capitalize on the growing demand for secure identity management solutions.
Analysts expect Okta’s revenue and EPS for the fiscal fourth quarter of 2025 (ending January 2025) to increase by 10.6% and 16.9% year-over-year, respectively, totaling $669.10 million and $0.74. Okta has topped consensus revenue and EPS estimates in each of the previous four quarters. This consistent performance underscores the company’s robust growth prospects and its ability to deliver value to its shareholders.
Okta’s shares have increased by 17.1% over the past three months, closing the last trading session at $84.66. Okta’s sound growth prospects are reflected in its POWR Ratings, with an overall rating of B, translating to a Buy in the proprietary rating system. Okta enjoys an A grade for Growth and a B for Momentum within the Software – Security industry, ranking #10 out of 20 stocks. This favorable positioning highlights Okta’s potential as a strong investment opportunity in the cloud-based solutions sector.
Conclusion
The cloud-based market is thriving due to the rise of hybrid work trends, intrinsic efficiency, and increased spending on cloud services. This progress in cloud technology is fueling a widespread digital transformation across numerous industries globally. As a result, investors may find significant opportunities in acquiring shares of robust cloud-based companies like Atlassian Corporation (TEAM), Autodesk, Inc. (ADSK), and Okta, Inc. (OKTA), all poised for considerable growth.
Cloud services are a key component of cloud computing, offering speed, cost-efficiency, scalability, and security. Many organizations now prefer these services, especially with the trend toward remote and hybrid work, which has significantly boosted their adoption. These features are particularly appealing to businesses looking to streamline operations, reduce overhead, and ensure data security and compliance.
The cloud market is seeing substantial investment and popularity across various sectors, positioning it for notable success. Gartner predicts global end-user spending on public cloud services will hit $723.40 billion by 2025, up from $595.70 billion in 2024. Fortune Business Insights also forecasts the cloud market will reach $2.29 trillion by 2032, with a compound annual growth rate (CAGR) of 16.5%.
