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LATEST NEWS

  • Marijan Hassan - Tech Journalist

Brutal week for US Big Tech with nearly $800bn wiped off valuations

Between Monday and Thursday last week various companies released their third-quarter reports and the figures are concerning. More than $800 billion was wiped off the valuations of major US technology companies with Alphabet, Amazon, Meta and Microsoft combined losing over $350 billion.



All this will come as a shock for these companies who have been experiencing nothing but exponential growth in the past decade. Apple was the only exception after beating its revenue and profit projections for the said quarter. Apple stock experienced its best day in over two years.


Unfortunately, the same cannot be said about Meta. The company was short on earnings and recorded its worst average revenue per user in two years. Projections show that its sales for Q4 will decline for a third straight period. Meta CEO, Mark Zuckerberg didn’t sound that much optimistic in his statement during the company’s earnings call.


"There are a lot of things going on right now in the business and the world, and so it's hard to have a simple "We're going to do this one thing, and that's going to solve all the issues," the CEO said.


Meta's stock had its worst week since the company's IPO in 2012, dipping by 24% in just five days.


Microsoft dropped by 2.6% for the week and that was largely because of a 7.7% dip on Wednesday after the company gave not-so-convincing guidance for the year-end period and missed estimates for cloud revenue.


Amazon o the other hand fell 13% also because of weak Q4 predictions coupled with a significant slowdown in its cloud computing offering. Reports show that Google cloud is outpacing Amazon Web services in terms of expansion.


"We are excited about the opportunity, given that businesses and governments are still in the early days of public cloud adoption, and we continue to invest accordingly," Ruth Porat, Alphabet CFO was quoted saying. "We remain focused on the longer-term path to profitability."


While it’s normal for tech stocks to go up and down investors will be wary of these new figures from big tech especially since they come in the wake of soaring inflation, rising interest rates and a looming recession. And while tech will continue to be a golden opportunity for investors you can expect to see people diversifying their investments into other markets that had previously lagged behind software and internet names.


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