Introduction
Over the past decade, businesses have embraced cloud computing platforms to enhance scalability, improve operational efficiency, and more rapidly deploy new applications and technologies. This adoption has transformed IT operations and has become a critical enabler of broader business objectives such as digital transformation, AI-driven insights, and global scalability.
As cloud adoption matures, organizations are navigating both opportunities and challenges. While innovation, scalability, and efficiency benefits remain compelling, the complexities of managing cloud environments have also grown and have put pressure on businesses to keep costs under control.
This report explores the state of cloud adoption and utilization, offering insights into the strategies CIOs employ to maximize the value of their cloud investments while addressing the challenges of cost management and resource optimization. It sheds light on the evolving role of the cloud in driving business outcomes and highlights emerging cloud computing trends that will shape the impact cloud platforms are having on organizations.
Adoption of Public Cloud Providers
Public cloud platforms have become an essential foundation for organizations of all sizes to power their infrastructure and applications. The survey reveals near-universal cloud adoption, with 99% of CIOs using third-party cloud providers for their infrastructure and applications, and only 1% of respondents indicating they only use private infrastructure. Of the public cloud platforms in use today, Microsoft Azure leads the pack (80%), followed by Amazon Web Services (74%) and Google Cloud Platform (73%).
Looking at the size of companies relative to their cloud platform selection, companies with 500–999 employees are most likely to use Google Cloud Platform (75%), while those with 1,000–5,000 employees have more commonly adopted Microsoft Azure (83%).
| Provider | Share of CIOs |
|---|---|
| Microsoft Azure | 80% |
| Amazon Web Services | 74% |
| Google Cloud Platform | 73% |
| IBM Cloud | 60% |
| Oracle Cloud | 50% |
| Alibaba Cloud | 16% |
| Tencent Cloud | 9% |
| None, only private infrastructure | 1% |
The Shift to Cloud-First Workloads
Most organizations now host the majority of their workloads in cloud environments. Virtually all survey participants have at least 40% of their workloads in the cloud, with an average of 68% of infrastructure and application workloads already hosted across public, private, or hybrid cloud environments. 72% say more than 60% are in the cloud, and 27% say 41–60% of their company’s workloads are in the cloud. Only 1% say 40% or less are in the cloud.
Workloads in the cloud also vary slightly by revenue:
- Companies with revenue of $100M–$499.9M have 64% of their workloads in the cloud
- Companies with revenue of $500M–$999.9M have 68% of their workloads in the cloud
- Companies with revenue of $1B–$2B have 72% of their workloads in the cloud
Organizations have made cloud adoption a core component of IT strategy, and that trend is accelerating. On average, CIOs surveyed said they aim to have 75% of their company’s infrastructure and application workloads in the cloud (public, private, hybrid) within five years. Notably, over 2 in 5 (42%) want to have 81–100% of their workloads in the cloud within five years.
As CIOs plan to increase their reliance on the cloud over the next five years, managing performance and costs will become more critical than ever. With a growing cloud footprint, organizations will need more strategic approaches to optimize resources, maintain efficiency, and control expenses. Effective cloud management is no longer a nice to have; it’s essential for ensuring scalability and achieving long-term success.
| Share of workloads in the cloud | Today | Five-year goal |
|---|---|---|
| 81–100% | 16% | 42% |
| 61–80% | 56% | 40% |
| 41–60% | 27% | 16% |
| 20–40% | 1% | 2% |
Cost Forecasting Presents a Major Challenge
As companies expand their use of cloud infrastructure, managing costs has become a major hurdle. 83% of CIOs surveyed said their actual infrastructure and application cloud spend is more than their anticipated cloud spend, with 60% saying it is over by at least 26%. On average, CIOs said their actual cloud spend is 30% over their anticipated cloud spend, and only 2% said their actual spend is under their anticipated spend.
| Actual compared to anticipated | Share of CIOs |
|---|---|
| Under the anticipated spend | 2% |
| Roughly equal | 14% |
| Over by 1%–10% | 11% |
| Over by 11%–25% | 23% |
| Over by 26%–50% | 27% |
| Over by 51%–75% | 18% |
| Over by 76%–100% | 4% |
| Over (net) | 83% |
Interestingly, companies with a higher percentage of workloads in the cloud struggle to anticipate cloud costs. Companies whose actual cloud spend is 76–100% over their anticipated spend had the highest percentage (87%) of their workloads in the cloud. Those whose spend is over by 11%–25% had only 64% of their workloads in the cloud. This underscores a critical gap in cost management practices for organizations heavily reliant on cloud infrastructure.
Confidence in Cloud Investments and Cost Savings
CIOs are confident that their cloud investments are driving measurable business value. Almost all (98%) CIOs surveyed are confident in correlating their infrastructure and application cloud spend with revenue gains, and just over 7 in 10 (71%) are extremely confident.
Even though 83% say their actual cloud spend is higher than anticipated, 80% of CIOs surveyed see cost savings from their cloud infrastructure and applications. Only 13% saw their costs increase.
| Outcome | Share of CIOs |
|---|---|
| See cost savings (net) | 80% |
| Significant cost savings | 44% |
| Marginal cost savings | 36% |
| Neither savings nor increases | 7% |
| See cost increases (net) | 13% |
CEO and Board Reactions to Cloud Costs
The rising costs of cloud workloads have not gone unnoticed by company leadership. Over 2 in 5 (43%) CIOs said their organization’s CEO and/or board of directors have concerns about their cloud spend. Despite these concerns, 56% of CIOs say their leadership supports current spending levels and would approve further increases.
This optimism is tempered by a growing awareness of cost management challenges. 27% of CEOs and boards require favorable market conditions to expand their cloud footprint, 9% are unwilling to approve additional expenses, and 5% advocate for reduced cloud spending or a return to on-premises solutions (2%).
While leadership recognizes the cloud’s transformative potential and the cost savings it can deliver, the pressure to control expenses is rising. CIOs are left with a very real challenge: optimize cloud spend, demonstrate tangible ROI, and ensure leadership support in sustaining or expanding their cloud investments. With costs consistently exceeding expectations, the question remains: how long will this support last before CIOs must introduce more effective cost management strategies to the CEO and board of directors?
Cloud Cost Management Strategies
As cloud spending continues to outpace forecasts, CIOs are adopting a variety of strategies to optimize their cloud expenditures. According to survey respondents, the top five approaches to managing cloud costs in the coming year include:
- Optimizing and modernizing application workloads for cloud deployment (52%)
- Leveraging cloud provider cost management tools (51%)
- Taking advantage of enterprise discount programs (49%)
- Tracking and auditing cloud deployments and expenditures (45%)
- Adopting a FinOps approach (32%)
Many CIOs are also exploring other cost containment initiatives, such as leveraging high-performance Java platforms to reduce cloud waste (30%) and adopting newer chip architectures like ARM for better price-performance (29%). Some are even considering repatriating workloads to on-premises solutions (22%).
Top Business Drivers for Cloud Migration
According to CIOs surveyed, the primary business drivers for migrating workloads to the cloud reflect a mix of technical, operational, and strategic priorities.
Leading the list are data analytics and AI/machine learning capabilities (42%), followed by cost efficiency/lower cost to serve (40%), scalability and flexibility (39%), employee productivity (32%), and business continuity and disaster recovery (25%). These drivers highlight how essential the cloud has become for leveraging advanced technologies, boosting efficiency, and maintaining resilience.
Other notable factors influencing cloud migration include competitive advantage (25%), sustainability goals (25%), faster time to market (22%), customer satisfaction and loyalty (21%), and top-line growth (19%).
The importance of these drivers varies by company size. Among larger organizations with 1,000–5,000 employees, 43% of CIOs identified cost efficiency/lower cost to serve as the top driver, compared to 32% of CIOs at smaller companies with 500–999 employees. Employee productivity was cited by 33% of CIOs at larger organizations, compared to 28% at smaller companies. These differences highlight how organizational scale and priorities influence cloud adoption strategies, with larger companies placing greater emphasis on cost efficiency and workforce enablement.
Conclusion
Cloud computing has become essential for driving innovation, improving scalability, and achieving cost efficiency, but it also comes with its challenges. CIOs face growing pressure to manage expenses, maximize ROI, and meet the expectations of leadership, all while staying competitive in an evolving landscape. To succeed, CIOs must adopt smart strategies that align cloud investments with business goals, enabling them to fully harness the potential of the cloud and deliver meaningful outcomes that drive lasting business success.
About This Survey
The research was conducted by Censuswide among a sample of 300 CIOs aged 25+ in large businesses (500+ employees and a revenue of $50 million or over) in the U.S. The data was collected between December 2, 2024 and December 5, 2024. Censuswide abides by and employs members of the Market Research Society and follows the MRS code of conduct and ESOMAR principles. Censuswide is also a member of the British Polling Council.
