Big Tech Stumbles in Third Quarter as Meta Suffers Historic Weekly Loss
Major tech companies outside of Apple lose over $350 billion in market value following bleak third-quarter earnings and weak future guidance. Meta experiences its worst week since its 2012 IPO as economic headwinds weigh heavily on the sector.
Big Tech companies face a brutal earnings week as Alphabet, Amazon, Meta, and Microsoft combine to lose over $350 billion in market cap. These staggering losses follow concerning third-quarter results and weak future guidance, marking a stark contrast to the unbridled growth the sector enjoys over the past decade. Economic headwinds like soaring inflation, rising interest rates, and a looming recession heavily contribute to this sudden slowdown.
Apple stands out as the sole bright spot among the major tech giants, beating revenue and profit expectations to post its best stock day in over two years. In sharp contrast, Meta suffers its worst week since its 2012 initial public offering, with its stock plunging 24% over five days. The social media giant misses earnings estimates, reports its lowest average revenue per user in two years, and warns of a third straight period of declining sales.
Amazon and Microsoft also experience significant sell-offs due to gloomy fourth-quarter forecasts and slowing cloud-computing growth. While Amazon Web Services sees its expansion slow to 27.5%, Google's smaller cloud division accelerates to almost 38% growth, prompting Alphabet to continue investing in the sector despite plans to rein in overall headcount growth. Executives across the industry struggle to provide simple solutions to the multitude of current macroeconomic and business challenges.