Microsoft, Meta, Google, Apple and Amazon announce their quarterly results in the coming week. Investors expect bad news. Europe will feel the consequences.
The past six months were a black chapter for big tech. Meta lost $200 billion in market value due to a disappointing quarter in February 2022. Apple struggled with a similar amount in April 2022 and AWS turned a loss for the first time since 2015.
Microsoft continued to grow, but warned of economic uncertainty nevertheless. As a precaution, the tech giant cut back on new hires. Google and Apple followed suit.
The reasons differ, but inflation plays a role. Tech giants depend on consumers. When inflation rises faster than purchasing power, consumers invest less in technology. In June, US consumer prices were 9.1 percent higher than a year before.
Each tech giant will share their latest quarterly figures in the coming week. Microsoft and Google on Tuesday, Meta on Wednesday, and Apple and Amazon on Thursday. The companies prepared investors for bad news in recent months, but the results may still disappoint.
A disappointing report causes share prices to fall. As a result, the organization in question cuts back on spending. Job security staggers and partners receive less support. The US is the largest market for big tech, which is why the US faces the biggest blow. This doesn’t mean that Europe is exempt.
Investors lose market confidence when big tech share prices drop. As a result, investors not only reconsider investments in big tech, but every company across the chain, including foreign startups and scaleups. Funding is harder to come by in every country and market relevant to the organization affected.