Cloud computing is the storing and accessing of data and programs over the internet rather than on a computer’s hard drive. With today’s wired world creating data at an exponential rate, cloud computing is one of the fastest growing areas of technology. And spending on cloud computing services is growing almost as fast as the data that’s being accumulated.

According to Statista, spending on cloud infrastructure services worldwide grew by $12 billion in the fourth quarter of 2023, reaching $73.7 billion for the three months ended Dec. 31. For all of last year, $270 billion was spent on cloud infrastructure services. The dollars up for grabs explain why technology companies large and small are racing into the space and trying to gain market share in the hotly contest and super competitive sector. Here are three strong buy cloud computing stock to add to your Q2 must-watch list.

Microsoft (MSFT)

Microsoft’s (NASDAQ:MSFT) current growth is not being driven by artificial intelligence (AI) but by its cloud-computing segment. The Seattle-based technology giant most recently reported that its Intelligent Cloud segment posted $25.88 billion in quarterly revenue, up 20% from a year ago. Within the cloud segment, revenue from Azure and other cloud services grew 30%, ahead of the 27% expected on Wall Street.

In its earnings release, Microsoft noted that it now has 53,000 Azure AI customers, and one-third of them are new to Azure in the past year. The company added that the number of commitments it has received to spend more than $1 billion on its Azure cloud services in the year ahead increased during the last quarter of 2023. The company has also introduced new custom cloud-computing microchips.

Oracle (ORCL)

Oracle (NYSE:ORCL) is also seeing strong growth driven by its cloud unit. Oracle’s cloud service and license support segment, its largest business, saw sales rise 12% to $9.96 billion in Q4 2023. The growth in the cloud services unit offset declines in the company’s other units, especially its hardware business where revenue fell 7% year-over-year to $754 million. The strong cloud growth also led Oracle to issue upbeat forward guidance.

The company expects earnings of $1.62 to $1.66 a share for the current first quarter of 2024, ahead of analysts estimates of $1.64 in earnings. The company said it anticipates revenue growth of 4% to 6% in the current quarter, also ahead of analyst expectations. Management also said during an earnings call that continued growth of its cloud-computing unit should help the company reach $65 billion in sales by 2026.

ORCL stock has gained 40% in the last 12 months, including a 20% increase so far in 2024.

Amazon (AMZN)

Amazon (NASDAQ:AMZN) remains the cloud-computing king with a 31% share of the global market for cloud infrastructure. That said, Microsoft is quickly gaining on Amazon and now holds a 24% share of the market. There have been some concerns about Amazon Web Services (AWS) maintaining its dominant position. In its most recent quarterly results, the company reported that revenue from Amazon Web Services (AWS) totaled $24.20 billion, matching though not exceeding Wall Street’s expectations.

The concerns might be a little premature. There are many analysts who expect Amazon’s cloud unit to get a big boost in coming quarters from the adoption of AI technologies. Analysts at Monness, Crespi, Hardt recently reiterated a “buy” rating on AMZN stock with a $215 price target, implying 20% upside from current levels. The analysts said: “We believe the leading cloud service providers are well positioned to benefit from the early-stage ramp of generative AI projects, including AWS.”

AMZN stock has gained 82% in the last 12 months, including a 19% increase so far this year.

On the date of publication, Joel Baglole held a long position in MSFT. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.