Tech giants that got drunk on profits earlier now suffer a ‘post-pandemic hangover’

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Amazon, Apple, Meta, and Alphabet – Google’s parent company, revealed numbers for the first quarter of this year and their numbers indicate that the big tech is not immune to market instability.

While the US tech behemoths raked in billions of dollars and posted results in line with lower expectations, their stocks fell as investors speculated that the problems would not be resolved anytime soon, reports AFP.

According to eMarketer analyst Paul Verna, the companies may be suffering from a “post-pandemic hangover.”

Also read | Digital Services Act: What it means & and how EU will regulate tech giants

“While the epidemic wasn’t a party for these enterprises, it did significantly enhance their sales,” Verna was quoted as saying by AFP.

Amazon reported its first quarterly loss since 2015, weighed down by its investment in electric truck startup Rivian, and warned of further troubles in the coming months. The e-commerce company reported a $3.8 billion loss in the first three months of the year.

Watch | Meta reports quarterly profit of $7.5 bn, shares surge after increase in Facebook users

“This was a tough quarter for Amazon with trends across every key area of the business heading in the wrong direction and a weak outlook” for the second quarter, said Insider Intelligence principal analyst Andrew Lipsman.

iPhone maker Apple announced higher-than-expected profits amid strong customer demand but warned that the China Covid-19 blockade and other supply chain issues will cost the company $4 to $8 billion in the June quarter.

Also read | Tesla CEO Elon Musk’s purchase of initial 9% stake in Twitter under scrutiny, says report

Acknowledging supply chain disruptions driven by Covid and silicon shortages, the war in Ukraine, Apple chief executive Tim Cook said “we are not immune to these challenges.”

Digital marketing is very important for Alphabet and Facebook parent Meta, and their financial reports reveal that marketers are being more cautious with their spending.

Paul Verna noted that the pandemic’s rapid expansion was not sustainable and that the tech giants should have foreseen this.

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(With inputs from agencies)



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