OVHcloud’s Public Cloud Momentum Strengthens as European Cloud Demand Holds Up

French cloud computing group OVHcloud reported stronger third-quarter growth, giving investors a clearer sign that its Public Cloud division is becoming a more important engine for the business. Organic revenue growth reached 6.9% in the quarter ended May, improving from 5.1% in the previous quarter, while total revenue rose to €289.6 million from €271.9 million a year earlier. For the first nine months of the fiscal year, revenue reached €844.9 million, up 6% on a like-for-like basis. The company also confirmed its full-year outlook, which is important because OVHcloud had previously faced market pressure after issuing a more conservative FY2026 growth target than investors expected.

The strongest signal came from Public Cloud, where revenue rose 20.2% to €65.6 million, making up about 23% of total quarterly revenue. This segment covers scalable cloud computing and storage services delivered over the internet, typically on a pay-as-you-go model. Its faster growth shows that OVHcloud is gaining traction beyond its historically stronger dedicated infrastructure and hosting businesses. The launch of its VPS 2027 virtual server offering appears to have helped attract smaller customers, while broader demand for flexible cloud capacity remains supported by AI workloads, digital transformation, and European interest in cloud sovereignty.

The performance was also geographically broad. Revenue growth outside France outpaced the domestic market, with the rest of Europe up 7.4% and the rest of the world up 8.6%, compared with 5.8% growth in France. That matters because OVHcloud is trying to prove it can compete internationally while still using European technological independence as a differentiator against much larger U.S. cloud providers such as Amazon Web Services, Microsoft Azure, and Google Cloud. The fact that demand remained resilient after April price increases suggests customers are still willing to pay for OVHcloud’s cloud infrastructure, especially where data control, local hosting, and regulatory alignment are important.

Still, the company’s growth story is not evenly spread across all divisions. Private Cloud, which remains the largest business line, grew 4.0% to €174 million, while Web Cloud increased only 2% to €50 million. This means OVHcloud’s overall acceleration is being carried mainly by Public Cloud, while the older parts of the business are expanding more slowly. The group’s net revenue retention rate reached 102%, showing that existing customers are spending slightly more than a year earlier, but not at the level of a high-growth software company. For investors, this makes the public cloud segment the key area to watch: it is still smaller than Private Cloud, but it is increasingly central to the company’s growth narrative.

The update also fits into OVHcloud’s broader strategic push under founder and CEO Octave Klaba, who returned to the top role as the company tries to balance profitability, capital spending, and AI-related demand. Earlier in the year, OVHcloud highlighted stronger adjusted EBITDA margins, hardware stockpiling to manage component cost inflation, and the creation of a dedicated defence unit to serve European military and public-sector demand. The latest quarterly result does not remove all concerns about slower FY2026 growth, but it does show that OVHcloud’s core strategy still has momentum: build a European cloud platform with stronger exposure to public cloud, AI, and sovereignty-sensitive customers while maintaining financial discipline.