AWS and Azure both raised pricing on compute and storage tiers in H2 2025. For most SaaS companies, the impact showed up as a 10–20% increase in monthly infrastructure costs without any corresponding product change. The result lands in COGS before it comes up in any conversation. If your gross margin has compressed three or more points in the last two quarters and your product has not changed, cloud cost creep is the most likely culprit.
The problem is that most finance functions at $5M–$15M companies review cloud costs annually during budget season. By the time the compression surfaces, you have already given away six months of margin.
Where the cost is hiding
The bulk of the bleed is usually in three places: compute instances provisioned for peak load but running at low utilization the rest of the time, storage tiers that auto-escalate and never get reviewed, and API call volumes that scaled with product usage but were never built into unit economics models. These are not engineering failures. They are finance and engineering failures together, which is why neither team catches them alone.
What a CFO does here that engineering cannot
The engineering team can identify the underutilized compute. The finance function connects those instances to the gross margin line and builds the business case for reserved instance pricing. The conversation with your cloud provider about committed use discounts requires a financial model showing your actual capacity requirements. That model is what gets you a real negotiation, not a verbal request.
The structural fix is a gross margin review for every new feature deployment before it goes live. Engineering scopes the compute requirement. Finance prices it into the unit economics. It adds one step to your sprint process. It stops you from deploying features that are margin-negative at scale.
If your gross margin has compressed more than three points in the last two quarters and you have not touched pricing, it is worth a look. The Financial Diagnostic surfaces cost structure issues in week one. Book a strategy call.