The cloud wars continued to wage this quarter with Amazon’s cloud business falling short of Wall Street’s expectations and sending its stock tumbling in after-hours trading on Thursday. Meanwhile, Amazon’s closest cloud competitor Microsoft posted its quarterly earnings a day earlier, and handily beat expectations but also reported declining cloud growth.

Amazon beat total revenue expectations, reporting $70 billion for third quarter 2019 revenue — a 24% increase year over year — compared to $68.7 billion expected. However, it’s Amazon Web Services (AWS) posted lower-than-expected revenue at $9 billion versus analysts’ expected $9.19 billion.

“The biggest impact that we saw in Q3 year over year in the AWS segment was tied to costs related to sales and marketing year-over-year and also to a secondary extent, infrastructure,” said Amazon CFO Brian Olsavsky, according to a Seeking Alpha transcript.

Still, AWS’ 35% year-over-year growth continues to outpace the rest of Amazon, which saw 24% overall growth. But it’s a drop from AWS’ 37% Q2 growth rate, and the third consecutive quarter of declining cloud growth.

Meanwhile, on Wednesday Microsoft posted its first-quarter fiscal year 2020 earnings and reported $33.1 billion in revenue — a 14% increase year over year boosted by its cloud sales. The company’s Intelligent Cloud division revenue, which includes Azure, Windows Server, SQL Server, and GitHub, was up 27% year over year to $10.8 billion.

Microsoft doesn’t report dollar amounts specific to Azure but said Azure revenue grew 59% during Q1. However, this is down from 64% growth in the previous quarter and follows several earlier quarters of slowing growth.

Despite both cloud giants’ declining cloud growth, “both Amazon and Microsoft turned in some very strong Q3 numbers,” said John Dinsdale, chief analyst and research director at Synergy Research Group, in an email. “Relative to Q1 and Q2, both will nudge up their share of the worldwide [cloud services] market — Amazon moving to around 33.5% share and Microsoft to around 16.5%. It is also notable that both have increased their capex relative to 2018, driven by continued aggressive buildout of their data center footprint.”

And Dinsdale pointed out, “the cloud market continues to grow at an impressive rate. The total market size in Q3 was just a little shy of $25 billion, meaning that in October the annual revenue run rate has already blown through the $100 billion mark.”

He also dismissed concerns about slowing cloud growth rates.

“It is a truism that as great scale is achieved, then growth rates will decline,” Dinsdale said. “The sequential growth in cloud service spending was around $1.5 billion in Q3, in line with the growth seen in the first two quarters of the year. Projecting ahead to the end of the year, total 2019 market size will actually be a little higher than we’d forecast. Did someone say the market is weakening? Oh, I don’t think so. The cloud market is in rude good health.”