Growth at Alphabet's cloud unit was dampened by its big exposure to smaller clients. Microsoft currently trades at 28.5 times its 12-month forward earnings estimates, compared with the Google parent's 24.93. In the battle to tap the next growth driver for the cloud business, Microsoft has focused on its core business clients that already use many of its software services, while Google has turned to startups.. "Demand for artificial intelligence drove Microsoft's growth. Demand among Google's larger clients was similar, but the firm is more exposed to high-growth and startup clients, which have been more aggressive with cost-control efforts," Morningstar analyst Ali Mogharabi said. The share losses suggest investors are concerned that Alphabet's focus on startups and slower roll-out of AI services was delaying the earnings boost from the new technology. Google Cloud offers AI capabilities through its Vertex platform.