Tech’s Biggest Companies Are Sending Worrying Signals About the Economy

Oct 26, 2022 · 280 comments
NYC Former Resident (The South)
Absolutely. Biden and Dems broke the economy— wild spending, crusade against domestic US oil, massive giveaways to students when there’s no reason, green corporate welfare, all on top of chaos at the border and spiking crime. The economy was basically fine two years ago, even with Covid. Now here we are.
PB (NJ)
@NYC Former Resident I am personally against debt cancellation. However, no debt has been canceled yet so how is that a factor in “broke economy”? The economy, except for inflation, is fine.
Erik (Truckee)
@NYC Former Resident A clear analysis of economic events but missing some context. It also appears that Biden and the Democrats have ruined the economies of every country around the world.
Jim (NH)
@NYC Former Resident ...no, the economy was not fine with Covid, and was not going to be fine as it (hopefully) lessens...it is a worldwide economic readjustment...it'll take some time to get to a new "normal"...how long, I can't, of course, say...
FxQ (Cincinnati)
I really don't know why everyone is so surprised by this. We are currently in a recession and heading further into the abyss. We now have only 12 days of diesel fuel on hand. Let that sink in. Our disastrous proxy war with Russia, Europes main supplier of cheap and abundant energy for decades, is leading to the literal deindustrialization of an entire continent as their sanctions on their energy supplier is causing economic suicide. I don't think people fully understand the absolute economic and societal chaos barreling towards Europe that will have major ripple effects here. And all for what? Corrupt little Ukraine and men in synthetic track suits and tee shirts who can't get along with their neighbor. As I said, people have no idea the pain heading our way.
DB (Hawaii)
@FxQ i share your sentiments.
WSciman (TN)
@FxQ Share your concerns though I wonder which is worse - the current proxy war with Russia and its' continuation or the alternatives of either allowing them to succeed or direct war. Troubling indeed.
William Fang (Alhambra, CA)
Are YouTube and Meta really tech companies if they derive the lion share of their revenue and income from ads? Sound more like traditional media conglomerates with more gadget. If Amazon is mostly reliant on selling stuff via ecommerce, isn’t that just a more tech savvy retailer? Apple sounds more like a tech company. But even Apple hsd no manufacturing onshore. So maybe it’s really just a big importer with a slick design department.
Cassandra (SF)
What good news that Meta if declining in value. Hope it tanks.
TTom (Virginia)
That's because what used to be one's discretionary spending is now having to go to exorbitant food prices in the stores.
Victorious Yankee (The Superior North)
@TTom, Shell just posted it's second best quarter in history. Imagine if people still drove. Their grotesque profits shows it wasn't inflation, just good old fashioned price gouging. Ain't big oil grand?
Ash P (San Jose)
I am following both WSJ comments and NYT comments. One commanlity is the hate towards Facebook. In my opinion, even though Facebook has many evil policies, most tech companies have some form of another going on.
William A Keating (North Amityville, NY)
@Ash P Lots of Facebook users never see the seedy side. Like me until I wandered around a little. To most of the people I know who regularly use Facebook, it's just a place for you to find all your old and new friends and family, no matter how long ago you knew them or to where they have relocated. They post old photographs, or new jokes, and throw in photos of their pets or their latest vacation spot. If you're feeling lonely, or afraid, getting in touch with people you know on Facebook is not the same as personal contact in giving your spirits a lift, but it's maybe at least half of a real social encounter. You pretty much have to go looking for the political hacks. And they aren't any worse than the people who comment online to Washington Post articles.
Reginald V. Wedge (WA)
BIG TECH is the sector that should worry and be worried. BIG TECH has distorted economies since its inception. Now it is finally getting its comeuppance and meeting its reckoning. Our basic economy will sort itself out over time as it always does.
Capt. Penny (Silicon Valley)
I suggest reading up on the collapse in tech jobs at the end of "The Gulf War" Feb 28, 1991 in Kuwait. Over 250,000 tech jobs disappeared in Silicon Valley in a matter of weeks. In those days we were building out packet-switched networks, "the Network is the Computer" proclaimed John Gage in 1984, but the commercial Internet was so young there weren't any ads for an ad-based business model until 1994.
Bob (Bell County)
Blaming inflation on strong demand while ignoring quarterly earnings briefings is disingenuous. Demand isn’t up, “pricing power” is. This buoys earnings as demand sags. Excessive margins (to the limit of what the market will bear) have been inflation drivers. “Retail gasoline prices go up like a rocket, and fall like a feather.” Energy: “Shell reported earnings of $9.5 billion, its second-highest profit on record.” (NYT) Food, Durable Items, etc.: “... in the last two days, we learned that IBM, Caterpillar, Coca-Cola, Harley Davidson and Wells Fargo all reported strong second-quarter results.” (CBS) Housing: Corporate or Real Estate Equity investments have raised home prices by buying up to 30% of local home markets competing with average home buyers who cannot pay cash on the barrel for the same homes. The reduced available inventory coupled with market (collateral) price escalation has fueled inflation growth in home and rental properties. Automobiles. There is little incentive for Ford to reduce prices even while inventories grow as high demand will persist for some time despite easing chip shortages and reduced raw material costs. The “companies” are navigating quite well.
Tony Frank (Chicage)
No tree grows to the sky. Time for a period of consolidation in these stocks. Valuations simply need to adjust to the reality of slower growth. Of course, pay attention to valuation these days and had rather invest on hype and hope.
Nanaimo (Berlin)
I am not a fan of Google, Mircrosoft or Apple BUT they provide services that I actually need everyday. The metaverse? Not so much. In fact, not at all. Maybe it would be a great experience if I was a billionaire with a couple of thousand employees to cover for me, while I am metaversing...until that happens I'll (gladly) be staying in the real world, taking care of my real kids and looking at real sunsets with my real husband and spending my real money on real vacations and concerts and so on.
NB (USA)
Is augmented virtual reality really the future? ... I am still skeptical on about that. The Zuck is losing billions per year on this... with a weak revenue model that relies on user data... reminds me about My Space, the big thing before FB....... social media seems like a fickle business model. Also, reading the news... I think a lot of people could use more reality in their reality these days rather than less....
Victorious Yankee (The Superior North)
@NB, The uncanny valley for VR makes the one for movies seem like a small dent.
back-button (Vermont)
I think the disrupter for American tech companies is TikTok. Google has tried to compete with their shorts, but I'm not aware that they have an YouTube app tuned for this experience available. YouTube won't be going away because TikTok will never have content or format that informs me on how to do a brake job on my Audi. Nevertheless, it's hitting the universe of online advertisers, who are now spending part of their budget on TikTok vs YouTube, Facebook, or Instagram. I'm not sure about Microsoft except they are really missing new, grow the business, value propositions. They made Office into a subscription business, which means it's now a cash cow, as is Windows too. LinkedIn has revenue limitations because it really isn't something that people constantly check or curl up on the couch to watch. MS needs to find a new 'need' that hits the general population. Google needs a short video specific app for viewing and authoring. I think Meta really has taken a wrong turn. I never post on Facebook, never really understood Instagram, and the whole metaverse is a hammer looking for a nail. If TikTok falls on its Chinese sword, Google had better be ready to pick up the pieces.
WSciman (TN)
@back-button Very prescient points, in my opinion. All of them. Except possibly that some of this perspective, which I share, is viewed from a specific generational vantage point, which I possibly also share (not knowing your background).
Jenny (Maine)
Before you all go around praising Apple, maybe think about why they did that. Now Apple can monopolize digital ad sales to their own users while their users blindly go about singing their praises. Apple PR and marketing machine hard at work.
Mark A (St. Paul)
@Jenny I don’t think I’m blind. Facebook is a net-negative for society, in my view, and if market forces can rein them in, good. Privacy-oriented search engines that block ads are also very useful.
Jenny (Maine)
That's fair, Mark. You're right to call out that not everyone who supports Apple's actions is doing so blindly.
Mark A (St. Paul)
@Jenny Cheers.
Nick (California)
Of course. Google fudges their numbers. Screw them for trying to cooperate with the ccp (see project dragonfly), stealing content from genius.com, and for not protecting our privacy at ALL. Same goes for the other tech companies. When will we in the US follow Europes lead and start cracking down on these companies?
Morris (NY, NY)
History repeating. Y2K lead to huge investment in technology and then it was over and so were the huge profits. The pandemic is ending and so are the huge profits. Why dose this surprise people?
Mr. Adams (Texas)
@Morris Very different situation here. The dot com bubble was driven by startups, whereas the pandemic bubble was fueled by industry leading giants. There's little risk of a Apple or Google going bust. Even Meta, despite hemorrhaging cash on this metaverse stuff, is hardly in danger. No one is likely to lose the money they invested in these companies over the long term, so there's not so much risk of investors running for the hills.
Jonathan (Connecticut)
Any experienced stock investor can tell you that trees don't grow to the sky. Growth is inherently limiting - once you're a giant company, you'll have all kinds of problems small startups don't have. Any place that has over 100,000 employees is most likely to become a disorganized mess.
Doug Scott (NH)
I don't see the comments as condemning technology. Technology is a huge industry with more than it's share of greed, self-importance, and desire to keep things moving in a profitable direction. Companies get dumb, fat, happy and non-competitive on a regular basis just as other industries have in the past. Technological advances have probably helped mankind more than hurt...but not from any noble directive or as a selfless gesture.
Steve F. (Pompton Lakes, NJ)
OMG!!! Google and MS only had $31.5B for the last quarter? Apple reportedly will report $20B? Gosh, I feel so so sorry for these organizations. Only ahead $51B combined for 3 months accounting. What's the world coming to? I guess we'll have to take extreme measures - and buy more of their products that we don't need because we already have the last 5 iterations of whatever they sold us.
WSciman (TN)
@Steve F. All of which seems to validate both Apples' strategy to further monetize their existing tech & market share, and Meta's search (with humongous financing) for the future nectar.
drollere (sebastopol, CA)
market saturation is a fact of business life, so the fundamental question is: how many people need an iphone, as a proportion of the people who already have one? we're more than a quarter century into the digital economy, and four decades into what might be called the consumer electronics economy. if you're an adult not already enmeshed in the digital infrastructure, it's unlikely next year will be different. OK, so you're enmeshed already, do you really need to replace the iphone or computer you already have? is a new camera, a new app for this or that, a new case color, form factor or processor chip really going to impel you, like a rabid gerbil, to dish cash for a pricey new unit? the metaverse is, however they want to spin it, basically a videogame space, with real people filling the role of NPCs. your colleague in singapore or london becomes no different from the characters spun out by videogame publishers of Far Cry or Call of Duty. only now your life becomes the authoring engine; the publishers don't have to hire script writers to fill the bill and kevin spacey or gary oldman to provide the art. what's the game here? to suck as much money out of your budget by selling you things that you're told you can't live without. but can you live without the metaverse and the digital economy? what the pandemic taught a lot of us is that the real world is valuable and true, and the bitworld is fabricated and illusory. hang onto that insight: you'll need it.
John Davis (Austin TX)
Couldn’t happen to a nicer bunch of guys.
wrenhunter (Boston)
It’s funny how we never question the supremacy of growth. The obvious retort is, "Well, do you want the economy to shrink?" No, but are those the only possible benchmarks?
Max Dither (Ilium, NY)
"The big tech companies haven’t really found a new, very profitable idea in years. " There it is, in a nutshell. What's the New Big Thing in tech? The metaverse? That was such a dumb idea, it's going to sink Zuckerberg and the old Facebook, and good riddance to them both. We need to see how Quantum plays out. That most likely won't be for typical end users like FB was, but it will change the computing marketplace worldwide. That is the Next Big Thing, but it will stay in the background, more as infrastructure than client interfaces. But it's time for a shakeout in high tech, anyway. New players need to appear. The only one of the old guard, Amazon and cloud computing with AWS, will thrive because it can change its underlying infrastructure to use the most modern tech systems without relying solely just on them. Their value proposition is better suited to the future than the others.
Shawn (Michigan)
Zuckerberg was only a one show pony. Facebook is a dated platform that drives engagement with anger and hate. No surprise the younger generation is going elsewhere. Zuckerberg should be prosecuted for the rohingya genocide, but will probably get away with it because of political ad spend discounts. I remember how googly eyed congress looked when he testified. Section 230 needs to be repealed at some point and whrn public enemy number one musk owns Twitter, I imagine that's when our representative wake up to how much hate, division, and anger these platforms really are. Meta will suffer from it's repeal. There's no way meta rebounds in it's current trajectory. The easiest way to identify failure in silicon valley is the necessity of explaing your product (meta verse) post COVID no one wants to be stuck in a virtual world, we just spend two years inside of one. Meta will fail, and silicon valley will continue struggling to cope with their COVID stimulus over valuations. Welcome to the COVID suffering from irresponsible government policies silicon valley, everyone else is already here.
Victorious Yankee (The Superior North)
Step One: Whine that you've only made billions this quarter. Step Two: Have the entertainers over at fox state tv begin softening up the brains of their poor rur viewers convincing them that trillion dollar companies and their billionaire owners are suffering again. Step Three: Another round of unfunded corporate tax cuts by the koch-gop in Congress.
Madge (NE)
Facebook has been due for a reckoning for a while now. And considering how much money they still have sloshing around, nobody needs to be weeping for them just yet. We’ll have to wait and see how all the spending on their primitive Holideck turns out. They may succeed in forcing the public to embrace and experience most of us don’t seem to want. But I wouldn’t count on it this time.
John Colby (Rhode Is.)
I don't mind seeing tech knocked down a peg or two. With all the social chaos brought about by princpleless tech innovators, I long for less pervasive communication platforms. Actually, something like a string between two soup cans. Operator please.
Victorious Yankee (The Superior North)
These big tech companies know that at least half this country is just stupid enough to believe them when they whine that they only made tens of billions in profit, THIS QUARTER. Big Tech knows that half the country are blanks waiting for fox state tv to stamp out their beliefs for that day. The useful idiots doing what they do best.
Eddy (Oakland CA)
I just switched industries after being in tech for 20 years. The reality from my experience is that due to the prolonged positive economic cycle the industry had become very bloated. As in I would walk into a meeting ( Zoomed for the past 2 years rather) and there would be 5 directors of something. Like more middle management than actual workers. I walked out of some meeting wondering how in the hell we made any money. Just pure incompetency all around with enormous amounts of money being wasted on some of the dumbest, least productive stuff. For the past decade or so the only way a lot of these companies grew was by acquiring other companies. Especially if said company was a threat to their own technologies. Lastly, its gotten obnoxious. I'd pull up in my ordinary commuter-mobile and there were seriously one or two Lamborghinis, A Ferrari and those were mixed in with hordes of BMWs, Teslas and other fancy cars. Loads of people who were not IMHO very productive getting paid way too much for doing work that wasn't very difficult and spending it as fast as they could. I always thought it was monopoly money and stashed it all away. My last tech job was my 9th, and when it was announced my company was probably going to layoff 1000's of people I bailed and found work in an old established, not exciting industry but one that doesn't require finding a new job every 2-3 years. I am done.
John Davis (Austin TX)
@Eddy Yes, the self-satisfaction of the nerd has been their undoing, I just wish we’d realized the fantasy of tech’s promises much earlier. Over- promise, price accordingly, underdeliver has been the business plan in SV for many years now, and they re-invest in their familiar places (tech) time and time again, failing 90%+ of the time. Why couldn’t we get some decent transportation options from all those billions/trillions? More reasonable health care or housing or education options? They were all about changing the world, but never mentioned it’d be for the worse. But many see such wealth and think they should emulate the plan. Let’s all go back to solid, human intelligence jobs, and see our isolation, distraction, and fear fall, while humanity and care for each other rise. Congratulations on your new life!
P McGrath (USA)
What a shocker, there could be bad economic times coming in the near future. Wow this is coming out of nowhere. Who knew?
NorthernVirginia (Falls Church, VA)
“Look I get that a lot of people might disagree with this investment,” Mark Zuckerberg, Meta’s chief executive, said on a call with financial analysts on Wednesday. “But from what I can tell, I think this is going to be a very important thing and I think it would be a mistake for us to not focus on any of these areas, which I think are going to be fundamentally important to the future.” The Beatles' prescience is astounding: "He's a real nowhere man, sitting in his nowhere land, making all his nowhere plans for nobody."
WSciman (TN)
@NorthernVirginia Maybe, but maybe not. How do any of us have better or more information to the contrary?
NorthernVirginia (Falls Church, VA)
@WSciman Yes, who can say? Zuck's "metaverse" may take off like the Segway (literally and figuratively).
Marsha Pembroke (Providence, Rhode Island)
"The decline is hobbling Apple’s Mac business" In an article that otherwise had supporting detail and data, where's the beef on this point? Any data that supports or proves that?
Brian (Houston, TX)
It could be that businesses have stopped over-paying for ads. Google and Facebook have enjoyed and taken advantage of businesses paying far more than a "click" or "view" was worth. Take for example a recent Facebook offer for my small business post to be seeing by 300 people for $20. Are you out of your mind? Time for Facebook to get it's head out of it's fantasy world (meta verse) and return to reality. Google is hardly better. It's dominance (monopoly) in online search ads combined with small business over-spending on ads contributes to PPC rates of $10 to $15. Conversion rates still seem to be around 3% which means that companies are paying $300 to $450 per sale. Unless you are selling online ads it's hard to make money on those sales. The problem in YouTube is the shadow advertisers who sponsor videos. You get hit with 2 ads at the beginning, a few in the middle and 2 at the end (which are wasted IMHO)..... and then the video producer takes cash to insert 3 minutes of "sponsored by SuckerNet your VPN solution for breaking the law". Youtube needs to de-monetize those videos which would put a fast end to it.
Charlie Young (Fairfax,Virginia)
Worrying signals for rich Americans! Not for me and millions of poor Americans! Joe Biden do something please!
Victorious Yankee (The Superior North)
@Charlie Young, He gave our young people a break on there usurious college loans and I couldn't be happier. Their newfound purchasing power will kick start our economy because heaping more and more money onto the already bloated leisure class sure as hell ain't doing it.
DonVitoC. (NY)
Tech needs a haircut. Economically and culturally. Full stop.
Victorious Yankee (The Superior North)
Maybe if you didn't force your customers to buy entirely new chargers everytime they update their iPhones they'd have more sympathy for you, Apple.
Info Fedajeen (US)
So many comments condemning comment technology, it's like cutting off a nose to spite a face(book). Techonology like everything else manmade, has a useful life, and in some cases even a planned obsolescence. The demise will tell out in profits and ultimately the business itself, if it doesn't redirect. Expect the good ones to capably redirect. The others, meh. Invest in the good ones.
WSciman (TN)
@Info Fedajeen Yup. I bought the 1st Macintosh PC in 1985 and paid way too much a proportion of my measly salary at the time. Learned a ton, however, and it helped my career immensely. Oh and I bought Apple shares too and have held on forever. Thank You Apple. On to the next thing? We all could only wish.
TheBackman (Berlin, Germany)
I think part of Apple's problem is they have abandoned integrity over squeezing money out of the customer. In 2016, they changed how the display was connected to the main board. They went from a robust cable to a ribbon cable. This by itself was not a problem but they made a design miscalculation and made the cable too short. This caused the cable to be stressed if opened past 90 degrees which nearly everyone does. That causes the ribbon cable to fail within a few years. On a windows computer costing a few hundred dollars, not a problem but Apple's MacBook Pro line goes as high as $3500 for the top of the line. Apple repaired the 2016, and in 2018 made the cable longer but the hundreds of thousands of people who bought the 2017 models, Apple just threw them under the bus. Tim Cook was a wizard at squeezing the supply chain. He could calculate cost benefit ratios. Cold hard calculation is his specialty. Caring about long term customers is something he does not value. Jon Ive made the cool stuff even cooler and he and Tim had a falling out. Quality is no longer Apple's number one, it is Money over Quality and Integrity. I am sure the slide will be slow but it has already begun.
NA (Montreal)
I am sorry to say that these "tech" companies are not producing much to add to the economy. They are ad agencies taking monies from all sorts of other companies so those companies can sell stuff that they make. The tech companies of yesteryear made stuff, Facebook, Instagram are a plague for the people... and I am happy if they just went away and believe you me they will go away one day. I am already seeing some "beught" kidd saying that all thus stuff is a waste of their time. If these companies like meta, Google do not have people wanting their time on their websites then their revenues will surely fall. Yes, I use Google to look up addresses opening hours of places but I would be dammed if I ever click on any ads.
ntyb (ny)
Part of the issue is making things a subscription and not allowing people to own what the buy. I don't need what the company thinks what I need to be the reason I by software etc. I use it and if there is something I think is "new" and helpful "I" will upgrade. There are only so many people and you cannot keep sucking every penny out of them - companies raising prices to keep their 14-20 percent profit. I don't get a 20 percent raise every year. MBA thinking only garners so much profit.
michjas (Phoenix)
They used to say as goes General Motors, so goes the country. Now it’s tech. Those who hate capitalism used to hate GM. Now it’s tech. For some reason, innovation, high salaries and satisfying consumers is a bad thing to many. These days the anti-techies have blogs on the internet that attack blogs on the internet. They aren’t as smart as they think they are.
Victorious Yankee (The Superior North)
@michjas, We love actual capitalism. Not the brand of we have now that sees greedy banks being bailed out time and time again after over leveraging themselves beyond belief, that sees American companies outsourcing jobs to countries that essentially use slave labor to get around American labor practices, that sees companies raiding pensions, slashing benefits, killing Labor unions and freezing wages all to benefit the top 1% of corporate executives and the stock holders instituting the rise of our royal hyper wealthy class. That ain't capitalism my friend. That's monarchy and we used to hate that kind of crap here in America.
Jeanne (New York)
"The good times continue at Shell. The London-based energy giant reported adjusted earnings for the third quarter of $9.45 billion, its second-highest profit on record and more than double the $4.1 billion it made in the same period a year earlier." - New York Times, 10-27-22 Could this be a big part of the problem? Corporate oil profits (greed)? And this will only get worse if the Republicans gain control of Congress and the State houses. God help us.
michjas (Phoenix)
The NYT is my main news source. But from time to time I read things in the NYT that seem far-fetched. That’s when I do a search that calls up every other news source. Google keeps the NYT honest. And it repeatedly convinces me that the news is in the eye of the beholder, who spins it right or spins it left. I love tech. It makes me a lot smarter than I am.
Rachel (Brooklyn)
This is…the opposite of how it really works
NoBs (Timbuktu)
USA and West while punishing Russia and Ukraine, yes Ukraine too, are punishing themselves. These highly industrialised economies thrive on their arms exports. In the top 10, except Russia, China and South Korea rest are all USA and West. It is disgusting that they preach the developing nations on climate control, inequalities and freedoms. USA in particular and its disproportionately vociferous Media give sermons without solving their homelessness, drugs, guns, healthcare and other inequalities in their society.
Pete (Los Angeles)
Why “even” those companies? They were the first recipients of free money
Michal (Poland)
Facebooks Metaverse gamble will fail. The company will be forced to make some tough choices. Mark Zuckerberg is bad for the company. Then again, the whole company is bad for humanity. So I welcome their demise.
Ollie Jones (Newburyport, MA)
Here's another way of thinking about this downturn in profits for the big net companies. They're siphoning less money out of the economy, leaving a few more scraps for the rest of us. These big online companies employ really smart planners and economists. They should have forseen that the COVID work-from-home boom would not last forever. The growth spikes they experienced during that time didn't stand a chance at continuing. They are close to saturating their markets. Can Google conquer any entirely new advertising market segments? Can FB grow their viewership 30% year-over-year when they have already some double-digit percentage of the world's population signed up? How many people who want, and can afford, an iPhone don't already have one? Is there a way to change business expectations from growth-growth-growth to sustainable steady state? Gosh, those big tech companies might have to start paying actual dividends to their retail investors to attract more investment.
JN (Springfield, MA)
"Apple is expected to say that it made more than $20 billion in profits in a quarter that will otherwise be considered a disappointment." And hence some people hate capitalism. Because enough is never enough. It gets to the point where it is like a disease. 20 billion in profit. That is an insane amount of money. Yet it isn't "enough". Sickness.
Victorious Yankee (The Superior North)
Imagine if they had to pay taxes like us little people.
Greg Gerner (Wake Forest, NC)
Wait, what? The "Masters of the Universe," wrong again?
Pretzel (Amherst, MA)
"From small to big to large"??
Christopher (Colorado)
Let me get this straight, the three biggest tech companies pulled in a combined profit of over $80 billion in one quarter and they are freaking out about "dark winter." Give me a break and then triple or quadruple those companies taxes.
Mister Ed (Maine)
Prescient article. Write more. You have a bright future.
Nick (Cairo)
Crisis brings opportunity; load up on cash, batten the hatches, everything is about to go on sale.
M (US of A)
The tech industry is much more than these useless social media bloodsuckers. Yet this report barely focuses on other tech sectors.
Sean (NYC)
Doesn't seem to be bothering anyone outside of those companies.
hen3ry (Westchester, NY)
Gee. with all the money these companies have made you think they might be able to pay their lower level employees a decent wage and give them predictable schedules and decent benefits. Oops, no. It's more important to overpay the CEOs. And that goes for other huge successful corporations. Shell posted record profits. Will any of those profits come back to the employees in terms of raises that keep pace with the increase in the cost of living? Have any of these companies decided to pay their fair share in taxes instead of squirreling away their earnings in overseas accounts? Have they decided that it might be nice to stop asking for tax breaks and requesting that their tax dollars be used to upgrade our infrastructure? Nope. Apple has decided to make it difficult for us to see classic Christmas specials. They own them now. That means that we have to go through them to see it. I'd rather see it on broadcast television. Those Christmas specials were part of our childhood. Some of us would like to see them again. But no, Apple OWNS them and gets to dictate the terms. I guess they spent too much on them and need to make it back. I have no sympathy.
WSciman (TN)
@hen3ry Hence the space and market for pirate tech and hacking. The light comes in through the cracks. And there are always cracks. In everything.
hen3ry (Westchester, NY)
@WSciman, the way Microsoft acted about owning the programs was ridiculous. It’s one of the reasons I switched to an iMac. Why should Microsoft control how I modify my computer or if l decide to own 4 computers and put their OS on? Reformatting a Windows based computer is a nightmare. As for Google and Facebook, something better has to come along.
Londoner (London)
"The iPhone, 15 years after it upended the industry, still drives Apple’s profits." The same goes for Google search, Gmail and Maps - and, in fact for cloud computing and social media. Reality, and in particular regulators across the globe, are starting to catch up. The dark arts employed by all these companies to eavesdrop, watch over and influence our lives are becoming apparent. I think, perhaps, the turning point was the question of how much information and influence Facebook had sold to Cambridge Analytica during the 2016 presidential election. Did they change the result? We still don't have an answer. But what people and lawmakers globally have gradually been taking on board is the implications of the even the possibility of influencing an election. Privacy concerns could no longer be swept under the carpet - nor could the complex market abuses that fed clients through to more and more of each companies own products. Nor could the barriers to entry. Without any new market sectors to exploit, the free lunch for these companies is coming to an end. And about time too!
Victorious Yankee (The Superior North)
@Londoner, Apple, Google, Facebook...ever notice these lists never include russian or chinese paradigm shifting tech. Just saying. China's economy hinges on us giving them stuff to assemble for us and russia, well, they're basically still stuck in the 1980s. Give me an American nerd any day of the week.
Londoner (London)
@Victorious Yankee. In effect all these companies are headquartered within a few miles of each other in California. This allows for a revolving door of talent and makes it rather easier for off the record "discussions" to take place between them. The further customers and lawmakers are from this area, the more disquieting the concentration of tech corporate power feels. While it was initially a strength, there's little doubt now that this extreme concentration is so obvious that it's becoming a source of vulnerability. Tiktok - the only new entrant to get a mention here - is Chinese. While US security concerns about this company are seen as valid in the US, the same rule applies. The further from California one is, the more these security concerns are seen as attempts to stifle competition.
Victorious Yankee (The Superior North)
@Londoner, How's that any different than the revolving door of talent and the concentration of investor class folks you'd find on Wall Street or in London's financial center? You don't think they engage in whispered talks behind the scenes? Come on. Same thing with any established economic sector. This is why we need to heavily regulate those clowns.
John Powers (Seattle)
The strong dollar is a problem for exporters like Microsoft. Why is the dollar so strong abroad when it is so weak at home? This happened before and, while I never understood, I went skiing in France. Small satisfactions.
Victorious Yankee (The Superior North)
@John Powers, Is it really? Where you gonna' go if Microsoft is too expensive? Use all those world famous Chinese or Russian operating systems and suite of apps? I'm sure they'll be dirt cheap. Come on.
Morgan (Cincinnati)
Google and meta rely on ad sales…but as more consumers do more shopping on Amazon…why would companies pay them as middlemen?
hen3ry (Westchester, NY)
@Morgan, because some of us don't shop on Amazon? I ignore all the ads. Some of them are downright offensive. I ignore the ads the NY Times insists upon showing us. A few of them are very badly placed.
Matthew (Avalon)
“On Thursday Apple is expected to say that it made more than $20 billion in profits in a quarter that will otherwise be considered a disappointment.” Making $20 billion in three months is the kind of disappointment I need in my life.
Victorious Yankee (The Superior North)
@Matthew, They have to whine regardless or they won't get more unfunded gop tax cuts during the next round that'll come if the forced birth insurrectionists win in November.
Eggs and toast (The breakfast table)
I don't weep for Big Tech. It's a monopoly and they have been suppressing new ideas for years by buying up start-ups, etc. This is only the natural result of that. As for Meta, I cheer when I see them lose money. They are not the worst company in the world, but they receive honorable mention in my book. Overall, the sooner the breakup of Big Tech comes, the better. I'll drink to that day.
Unconditional Conditioner (Uranium-Bator)
I have been through this a couple of times, being in my late 70s. Trust me, young bucks, this too shall pass.
Davish (CT)
Personal Computers are getting to be dinosaurs and so Microsoft is taking a hit currently. It has nothing to do with inflation or rates. I wouldn’t worry too much about Tech though - EVs are going to be very chip/software laden, and they and the new grid we will have to build are going to rejuvenate the whole world economy starting in a about a year.
Unconditional Conditioner (Uranium-Bator)
Have you been to ANY office lately? - yep, the same very office where over 110millions of us work every day. What do you see in EVERY cube if not a PC? The Demise of the ever pervasive PC is highly exaggerated.
Geoff Anderson (San Jose, CA)
@Unconditional Conditioner Correctamundo. The problem is that all of them were refreshed recently, so the next wave of updated machines for the office will be in 2.5 or so years.
Victorious Yankee (The Superior North)
@Davish, Oh, I doubt that. Yes, I love my smart phone but I'm not using it to create a spreadsheet or database or to enter data. I need a full size keyboard, a beefy CPU and a good sized screen for such work. Sure you could do all that in a smartphone but it would be tediously slow.
brooklyn (nyc)
I'm trying to understand how raising interest rates tames inflation, it seems like the opposite might be the actual case. Take, for example, the clothing industry, which relies often relies on borrowed money (factors) to prepare a seasonal offering, then makes its money on the back end with enough profit to pay off the lenders. By making it more expensive to borrow this money, the clothing manufacturers and retailers will need to raise prices. And this is true in many industries, with the cost of paying off corporate bonds another example.
Unconditional Conditioner (Uranium-Bator)
The interest rates are called to tame BORROWING. It is also promoting SAVINGS. A double win against inflation.
brooklyn (nyc)
@Unconditional Conditioner But my point is that borrowing is essential to the operation of many industries and a higher borrowing rate will lead to higher prices, aka, inflation.
RM (Accord)
@Brooklyn Right... and when companies borrow at higher rates and they do raise the price of their products, the consumer will look at this higher price of the product and not buy it. The borrowing company will have to eat this loss.
Someone (Reality)
Sorry, what tech companies are signaling is that their past decade's success was powered by cheap money. yes, there have been a handful of truely useful, positive disruptions in economy and our lives, but otherwise, most of it was spaghetti flying at walls, powered by ZIRP. and that reality is being exposed by rising interest rates
Buck (Flemington)
Companies relying on advertising are existing on shifting sands. The outsized capitalization of the fangs and other glamor stocks put the S&P in La La land. We’re now experiencing the correction. The last time we experienced this was Y2K and the tech bubble. Recovery will happen but in the meantime there will be some pain.
Joe (Mars)
If all Countries became Conservatives and start making their own Goods without relying on Imports or Exports none of Countries economy will Expand because people would manufacture and consume within the same country and money will stay in the country but it will not expand or grow, economic expansion or growth takes place when Apple exports phones all over the globe when Microsoft sells its OS all over the globe, if US turns conservatives then other countries can turn conservatives too and stop buying Microsoft OS or Apple phones, so all countries economies will be stagnant cos they will be conservatives not relying on imports or exports while all their money will stay in the country but it will not grow with exports and people will have to settle with whatever quality the country has to offer, it's like a store in a town having a monopoly to sell you low quality goods because you are not allowed to buy better quality of goods from neighboring town despite having money. Also if all countries became conservatives and stop relying on imports or exports, so in that scenario the only way economic growth will take place will be with the growth of population in which Countries will only do better if they have growing populations. The whole Conservatives ideology is Conflicting instead of participating in team work and team building that Liberals did with Globalization they are making Countries fight a Trade war Brexit, Calexit, Texist and other Wars knowing we are interdependent.
Timothy F. (Des Moines)
Tax cuts for the wealthiest and corporations took effect on Jan 01 2018. Powell’s propensity for a “hot” economy added to the trouble creating overvalued stock markets. Should’ve raised interested rates slowly in 2019. Greed, deregulation and lack of regulation hurting us again but we never learn. Petroleum industry, so important to the overall economy, running amok, continues to bite us. Gotta save capitalism from the capitalists.
tony (nyc)
@Timothy F. Sooooo Biden has nothing to do with this? I think American has something to say about that and soon...
Joe (Mars)
Previously America since it embraced Globalization had a market of Worldwide 7 Billion population to sell their Apple phones and Microsoft OS, but since they turn into Conservatives they will only have 330 Million Americans to sell these goods to, and all other countries will make their own, like China using Baidu instead of Google and TikTok instead of YouTube I believe Americans are smart enough to know that difference and wouldn't fall in the trap of Conservative Republicans who want to Control and take on the Power over American people and their lives especially Liberal industries like Tech who bring in all the profits from foreign only to be used by Conservatives to buy Oil from Conservatives countries making a cut in profits for them, Liberals should move to Green Energy if they want to win this battle!
Den (Palm Beach)
It is clear that the pandemic and the governments response, pouring more cash into the system and other factors, caused tech companies profits to ballon. Now, the events that caused the surge in profits no longer and people don't need new computers, software or new phones. We saw an upward surge and now we see a downward surge. It is simply a cycle we need to live thru. The tech companies are still innovating and creating new avenues for profits. Apple is moving into financial services, Meta virtual reality,etc., I was in an Apple store the other day and it was full of customers-waiting to be helped and It was a Wednesday! I was in the mall where the store was on Sunday and it was mobbed. My company advertises on Google and we still see excellent results in new customer attraction. But my company is not running out to replace our delivery vehicles or buy new computers until interest rates come back down or the asset is no longer usable. I see a state of flux and a time to be patient. But what I don't see is the long term gloom and doom that seems to be expressed in this article. I just see a smoothing out - steady but modest rise in profits-awaiting the next new tech advance.
alan (MA)
"Social media companies such as Meta said that advertising sales — the heart of their businesses — have rapidly cooled off." I've been completely off of Social Media for over a year. Don't miss it at all.
Victorious Yankee (The Superior North)
@alan, Because you can't ever delete your Facebook account, I deactivated mine when they went public. That means I can no longer catch up on my rightist aquaintances' latest conspiracy theories on virology, bamboo ballots, the shape of The Earth and who actually built the pyramids and I'm delighted. Social Media showed me just how dumb most rightists really are.
Kurt (Seattle)
I’m not that worried, just looking at Meta and Google’s financial statements suggest they are wildly undisciplined in hiring and cost prudence. Basically babysitters for Gen Z. Probably worth seeing what the rest of the S&P 500 reports through earnings season, so far seems like a mixed bag.
Friend (dc)
Tech companies are vastly different. Google and Facebook are ads—easy to replace and replicate. Only Samsung gets even close to Apple.
Heidi (Upstate, NY)
It is a problem that the most recent quarter they only made $51.5 billion in profits?
JeffP (Canada)
Google used to be actually useful when trying to do some basic research. Now most of the top results are all about trying to make me buy something, with real information seemingly scrubbed.
Lars (Norway)
@JeffP I don't think there is as much "real information" anymore. It seems like a lot of forums, personal websites etc. have moved into Facebook, where the information can't be indexed and found. And people make YouTube videos about a lot of things they would otherwise write about.
M (US of A)
Have you tried using Google maps lately? There are so many ad supported business tags they are blurring street names. Google maps is basically useless.
J Hagen (Sacramento)
It takes some time for the economics of political policy to bake into an economy. What we're seeing now is a transition away from bottom up economic development led by tax cuts and efforts to reduce government regulation to a regime with great tax and inflation uncertainty. This is the economic result of a command economy. When the government sneezes the economy gets a cold. In 2020 the majority of Americans voted for the party that said we need to spend more and you need to pay higher taxes. If you voted for that system, congratulations, you're seeing the result. You now have less savings in your investment accounts. You now have less money in your checking account after paying for myriad covid and climate change initiatives. Hopefully you feel good right now, because you got what you wanted. Personally, I didn't want this and was happy with light regulation and low inflation, and I'll vote accordingly next month.
Nick (Cairo)
A rather odd perspective. Covid fuelled stock market run-up was predicted….as is the correction. The world is suffering swings from supply shortages to overproduction. Russia’s war in Ukraine caused energy and food inflation….globally. Contrary to your criticism of taxation, the Biden admin didn’t raise the upper tier bracket at all. If you are losing money in this market, you have no one to blame but yourself. Raise cash, everything is about to go on sale.
Sam (The Mountains)
@j Hagen Sacramento . Nonsense this is not the fault of the Democrats . Corporations are making windfall profits from this situation and have no incentive to lower prices they raised.
JN (Springfield, MA)
@J Hagen the previous Administration gave huge tax cuts and gave away money. In fact, the president at the time actually requested his name be put on the checks the government was handing out. I find it amazing how myopic some conservatives are. They seem to forget everything that administrations they support did. And those large tax cuts have primarily stayed in place for the wealthy. We were told by Republicans that the tax cuts are the solution to everything. And finally, you completely discount the global recession. Once again, myopic. Typical.
michjas (Phoenix)
The profit motive encourages tech to innovate. It encourages the media to sell out. I prefer tech to the media.
john fiva (switzerland)
Why shouldn't the most powerful companies feel the effects of inflation and rising interest rates? Everyone puts on a jacket when it gets cold outside.
michjas (Phoenix)
@john fiva If corporations weren’t profitable, you’d be naked as a jaybird when it drops below freezing.
Victorious Yankee (The Superior North)
@john fiva, But normal people put on their own jackets not jackets provided to them the by tax payers.
Danny Swarzman (South San Francisco)
These companies are not in the same business. A company like Facebook or Twitter use the internet to make money. But they are not pioneers in technology. Apple and Microsoft make personal computer operating systems. That is a hard thing to do and takes thousands of engineers working for many years. None of these companies produce chips for industry or develop the tools to prototype and manufacture electronics hardware. While Facebook or Instagram or YouTube may control heaps of money, they are not leaders. They are not the companies upon which our technologic future depends.
Nick (Cairo)
Actually, Apple is very diversified…and indeed, they design their own chips.
Joan (Chicago)
Creating software that serves billions of people is hard. You seem to be thinking that “ making money on internet “ is easy.
DB (Hawaii)
@Danny Swarzman spot on.
Thomas Mann (Paphos, Cyprus)
One thing I don’t understand is how conventional wisdom says companies must be forever growing or be considered in dire trouble. I mean if a man sells widgets and everyone on the planet buys his widgets then he cannot fret about growth. He is making profits. His only worry is technical obsolescence. But that is not an issue with things we must have. Look at the Gulf States. They have been selling oil for a century and that market is not growing and they are so rich that they barely work. One would conclude this model of expectations of forever growth is imposed by investors, like hedge funds, who gamble with our money. So we have let gamblers set policy, so they can profit through speculation and layoffs, common sense and the common good.
michjas (Phoenix)
@Thomas Mann If production grows as it always has and you stand still, your market share steadily declines until you become small potatoes.
DB (Hawaii)
@Thomas Mann agreed.
j.j. (USA)
Everything in this article and the comments is nothing more than NOISE. None of it addresses the real problem with the economy, and hence, the companies that operate in it. Economic research shows that in every inflationary instance, the underlining factor has been connected to the money supply. And the problem that currently exists is a classic example of too much money being pumped into the system, absorbing and distributing that money at a faster rate than the actual economic expansion. The rising costs due to supply pressures, war, disasters, high interest rates are all symptoms, not the disease. The disease is the government generating debt and the Federal Reserve distributing it. The Fed then buys securities from banks to increase the amount of money these banks have in reserves. There is then more money than goods to buy, so prices go up. Inflation. FIX THE FED. Don't blame tech on the mess that currently exists. Don't blame the President or even the incompetent legislative branch. Blame the Fed for creating a closed loop of increased money being pumped into the system.
Allison (Fairfield, CT)
How can one ‘fix the fed?’
Nick (Cairo)
No man is an island. You think the US Fed is the bad guy? Look at what EU/China/Japan have done. The issues are global, the solutions will be global. The Fed is the sober one in a room full of drunks.
j.j. (USA)
@Allison The problem with the Fed recently is the fact that when Treasury had to underwrite the increased debt created by Congress to soften the pain COVID applied to the economy (all good and necessary), the Fed stepped in and bought that debt, closing the loop and in the process increasing the money supply. Had Treasury been mandated to sell the debt at a retail level to consumers, the money would have been tied up in assets(Treasury Bonds) and having less money in the churn would have kept inflation at a more manageable level (can't spend it if you don't have it). But, we are also very early in this current pattern and to be clear, economic trends take time to develop. Just saying, there may have been some missed opportunities...
SlickRick (Austin Tx)
When will companies realize it cannot be a party all time?? The economy goes up and down just like stocks and profits. Also Facebook and Google fonts have anything new to woo in more clients. I’m 44 and I haven’t checked my Facebook page in months, it’s full of fake people posing.
Actually (Anywhere)
Em..Microsoft is not Silicon Valley
L (Loc)
This just couldn’t be happening to a nicer group of people.
El Conejo (Kansas City)
Instagram is now a "loud" App. It use to be quiet with lots of good photography now its just videos of about anything you can think of-like watching your grass grow.
Heathmy (New York)
Are Google and Meta being hit by a "slowdown" in ad sales or are they just losing market share to Tiktok? This piece could be a bit more analytical...
Mask Of Comedy/Tragedy (Northeast)
The market eventually corrects
Joel (Northern California)
Buckle up folks. If history has taught us anything it’s that the crash is going to be just as large as the stratospheric boom.
Blue In Texas (Austin)
They will lay off thousands of people and not blink. Very volatile cut throat world
Peter P (Canada)
Meta is not "tech". It's a parasite.
Phil (Seattle)
@Peter P Yes. I would think semiconductors are the real tech.
Nicole (Los Angeles)
Sorry, but other than Apple, these are companies that profit as parasites off our privacy and data, treating the “consumer” as the commodity. I hardly lament the fact that their profits are no longer growing exponentially, and it would be a dumb economist who thought that Google’s profitability was in any way related to the real person’s financial stability.
Steve (Charlotte NC)
Market corrections are long overdue...
mythocracy (indoctrinated)
This article pretty much proves that America is high on stock market steroids.
Doug Fuhr (Ballard)
I'm using Power Point, Word and Excel for a project. They've changed hardly at all in years. Oh, and trusty old Paint. I can see a zillion opportunities for improvement, but MS is just milking them. Meanwhile, they continue to flog Bing. They made a pig's ear of IE, created a cottage industry making workarounds for problems it introduced, and now they want me to buy into Bing? I don't think so. MS tries to insert itself into everything I do with bad advice instead of good applications.
Gran Pere (Kansas)
@Doug Fuhr Windows XP Excel was like a fine inexpensive wine. So easy, so customizable, so friendly, then it was "improved." Ahh the good old days.
Sceptique (Washington, DC)
Meta problem is more than the economic. Thanks to Apple new OS, apple users are protected against constant harvesting of our data from Meta and the like, and this is the real reason why Meta is losing money.
Putinski (Tennessee)
Zuckerberg did not count on how tired people are of computers post lockdowns. I get depressed every time I hear any video streaming prompt like Netflix or Hulu. Tired of video, tired of computers. I do not want to put on head gear and spend my off time in fake reality. Period. My guts says many people feel this way. It will only be attractive when/if I am otherwise immobile.
A Nobody (Nowhere)
Could it be the pandemic reminded people there's more to life than working like a dog to buy gadgets? Perish the thought! How will Meta monetize me if I walk in the woods instead of going into debt to pay them to fit me with electronic blinders?
Mister Ed (Maine)
@A Nobody Amen! I am thriving on free time to explore life instead of "buying" things.
DK (South Delaware)
The GOP oil men and business men caused the high inflation and they won’t do any to fix it when they get in. Their plan again is to give all the tax breaks to the dead beat wealthy who pay no taxes like the GOP Congressmen and GOP senators. Then the biggest churches in America can gat away with paying no taxes. That is not right like Donald Madoff Trump has paid no taxes in decades He needs to pay taxes or toss him and his sons in jail for tax evasion.
Arthurstone (Guanajuato, Mex.)
“Meta said on Wednesday that its profit in the most recent quarter was down more than 50 percent from a year ago.” Well,it’s a start.
Nicole (Illinois)
This was a weird article because they’re all still making gobs of money… they’re just making it a little less fast than when we were all on lockdown. It doesn’t seem like it has to be a crisis .. but then, maybe we better lay off some hard working, family supporting employees and ruin some lives, just to be sure.
Rick (San Diego)
A profit of over $50 billion in the last 90 days or quarter by Google, Microsoft and Apple are considered a slow down. Perhaps it’s time for a cleansing breath, not for the companies but for the end-user.
Tautologie (Washington State)
Why shouldn't they feel the pain? Bring it.
Alexandra (New York, NY)
TikTok is a lot more fun. (I'm over 40.)
Jenny (CA)
Why don’t they compare these results to the last prepandemic year results? They keep saying that the pandemic created unusual conditions that caused outsized increases in tech growth. So it seems dumb to use the previous year as the benchmark. Treat pandemic numbers as the anomalies that they are, tell us how these numbers compare next to 2019 results.
Stephen Boyington (Derry, NH)
After Onlyfans and FanDuel, there is not much left in the kitty.
WSciman (TN)
@Stephen Boyington The modern opiums of the people, by the people.
Rashawn (Atlanta, GA)
Microsoft clearly seems like a buy right now, while Meta a clear short sale opp.
michjas (Phoenix)
Google (Alphabet) lost more than 10% of its value today based on its bad earnings report. That’s $124 billion evaporated just like that. I’m no expert but this seems like total nonsense. Weak earnings and bad prospects are always bad news. But a loss of $124 billion of capital value in a day? That’s almost 3 Twitters. It makes Elon Musk look like a day trader. Stocks are kind of a mystery to me. But if Google lost $124 billion today, my searches should be 10% slower and the Mt. View California home market should have just crashed. On this one you don’t have to be Kramer. Buy Google because the 10% loss is what us amateur stock pickers know is ridiculous.
Andy (Lexington)
There's a growing perception that neither Google nor Meta's ad products deliver what they claim. Even something as basic as google's web analytics have been measured as *orders of magnitude* divergent from other analytics tools tracking the same traffic.
Yoandel (Boston)
So in other words, Google is growing just a bit less, has no debt, and has had grown its cloud business by 40 percent... With a net profit of $13.9 billion in the third quarter, while revenue climbed 6 percent to $69.1 billion. So yes, profit is down 27 percent from a year earlier, but... it isn't as if Google would reduce its dividend (given it pays no dividends). And it has cash reserves of $125B. So frankly, Google is good. And so is Apple. Meta? Well it depends. If you believe the Metaverse will come, then after a decade of losses it might be a great investment. Otherwise...
William A Keating (North Amityville, NY)
It's absolutely comical that the readers of this journal, who are supposed to be better informed than most, would label large, successful corporations as a prime villain in the story of the country. Admittedly economics is not an easy subject to master. But we do know that a major feature of capitalism is the concentration of money in the private sector. In Socialism sees most profits as winding up in the hands of the government. Warren Buffett, our heroic stock investor, has often paid little taxes. He believes that he is better at spending his billions in philanthropy in place of the federal government distributing the profits around until after they had paid off those whose help they needed to gain re-election. Let's take a look at, for instance, Apple. Co-founded by college dropout Steve Jobs (with Steve Wozniak) Right out of the garage they created and marketed the Macintosh Computer,, the first to use a graphical user interface that allowed everyone to use computers. In doing so they created thousands of jobs as employees of Apple and Apple's suppliers. They sold billions of dollars worth of product around the world, and those profits, at whatever level the government chose to tax them, filled the government coffers with billions to support our high standard of living. Then they came up with the iPhone and did it all over again. But you think that they are evil and should return profits to the government instead of re-investing them into the business. Disagree.
Holger B (San Francisco)
@William A Keating That's right, we should stop inventing and building new companies and technologies and hand that all over to China going forward. That's a joke of course - I agree with everything you are saying!
Dialate (seethe)
@William A Keating the first computer they sold that got mass appeal was the Apple II in 1977 (appleI in 1976 was just a circuit board) The macintosh came years later in 1984.
Chip (USA)
Good. I hope Big Tech and Big Anything really feels the crunch. The more it hurts the better. Why? Because the Fed will never care if inflation hurts the little guy. They have said they want it to hurt the little guy. But Big Guys are different. The Fed will pay attention to them. So... may the Big Guys know our pain.
Jay (96814)
I read the headline and thought, hunh, how depressing is this article? And then, I didn't read it even though I'm sure it's beautifully written and well- researched. Personally I don't want to be more demoralized than I already am.
Jessica (Chicago)
It's not really that demoralizing. You can't just grow exponentially forever, and I have no idea why that is the default goal. I mean, I do: capitalism. But it just makes no logical sense. I don't know why slowing down = horrible. It's a mindset. We could just view this as a logical outcome. But no. It's doomsday.
DB (Hawaii)
@Jessica about right
Kevin (MA)
I’m keeping an eye on cloud services given that is now foundational to every business requiring IT which is like most today...
George (GA)
after a couple of years now it clicks: just before the pandemic one big subject was to reduce cloud storage, for two years we haven't been able to solve the issue and working remotely does not help as the problem needs to be solved face to face, now people threatens with quitting if forced to go back to the office so the problem is still there with not even the environment set up to fix it. yeah, this article is a good reminder to everybody that no matter how small or effort is, it counts
Bee man of Orn (Plano, TX)
Want to turn around the tech industry? Get rid of work on site requirements. Now is a fantastic time to purchase DDR5 DIMMs! I'm looking forward to purchasing the latest AMD Ryzen CPU, a full 128G of ram, and some Samsung Smart SSDs!
Lupus Yonderboy (The Sprawl)
Welcome to the forthcoming cyberpunk multi-national military industrial tech complex utopia. We have a brief lull while the capitalization of outer space really starts to ramp up. The last return routes of first generation post 60s space race grab and retrieve vehicle missions are on their way back to earth. Unlimited raw materials are on the moon and in the asteroid belt. All the patents for space elevators and off world mining service design have been written and are ready to be realized. On world Geo-thermal, alt-power, and carbon sequestration IP is getting into full gear. After we realize we cant dump carbon in the ocean someone will figure out how to solve the vortex problem of dropping steel cables through the ionosphere to the ground. Ready Set Go post-gadget consumerism economy.
Jules (California)
Don't we all learn in introductory business classes that all firms have a life cycle? Google and Meta are mature businesses with full saturation. Growth is uncertain; unfortunately that means punishment on Wall Street. The brutal and often ridiculous reality of publicly traded companies.
Brian (Maryland)
People are brainwashed into anything but constant growth is unnatural. Cyclical trends are natural but do punish low income individuals and households. If only there were safe guards to help people who need assistance while simultaneously preventing fraud… UBI comes to mind
Kay Kay (England)
Accept that the current playbook has been plateaued. However, consider that this is the best time for the best ideas for next big tech revolution. World cannot be void of Technology and remember consumer insatiable desires for "brand new" continue to fuel the next tech revolution.
Aaron (Orange County, CA)
My grandfather was a HAM radio operator with the Navy. From his radio outpost in Panama, he relayed the Pearl Harbor attack to Washington DC in real time. He taught me morse code and by age 10, I was sending him messages with the shortwave radio set he bult for me. That was 1975- the Apple computer was just launching. He passed long before iphones and text messages, I always wonder what he would think of those devices if he was alive today.
Mister Ed (Maine)
@Aaron He would think these people are delusional. Instead, he would take a walk in the rain and thrive.
Aaron (Orange County, CA)
@Mister Ed I think so too.. He couldn't operate a typewriter to save himself. He was beyond transcribing. Just by audio retention he could receive and send messages at over 55 WPM without taking any notes. That is alarmingly fast for the HAM community today- there's only a handful left with that ability. His call sign was 1Letter-1Number-2Letters .. anyone familiar with that knows how rare a call sign that is today.
Name (US)
Yes. This is bad but no surprise. When a company like Meta loses half its value in months, when the Fed starts the gears to raise interest rates in order to flip inflation to recession, when the UK financial stability is on a knife edge without any more assurance from Bank of England to buy bonds, when Chinese economy is contracting even as it acknowledges full dictatorship and Russia weaponizes energy, yeah this isn’t good. No surprise. Now what. Please, politicians, look at the big picture and stop playing identity/partisan games. The money that is poured into political campaigns is tossed around like Monopoly money.
Bill Tyler 🗣 (Nashville)
It’s not the DotCom bubble from the turn of the century. It’s like companies that matured, grew up, and create profits. Nobody’s going back to pencil, paper, slide-rulers and abacuses.
Auntie Mame (NYC)
@Bill Tyler 🗣 Ever considered what might happen if the electrical grid went down for a couple of weeks?? Geniuses out there. Pencil and paper are permanent to some degree. Electronic i not. Trun off your computer--it's not there. Turn off the lights, the paper is there. I was a whiz with slide rules.
Joe (WA)
Maybe perpetual growth isn’t realistic and problematic?
Doug Fuhr (Ballard)
@Joe Maybe not, but it's been going on for, oh, 4,000 years :-) They'll finally get quantum computing, or fusion power, or climate change, or maybe civil discourse figured out, and off we'll go again.
Kevin (MA)
@Joe I agree, capitalism requires consumers which translates to population growth or tapping poorer countries which Then leads to natural resource depletion and more carbon released. Unless we get smart about regulating as you suggest, it is not sustainable. It’s funny how companies like like Apple, Google, Microsoft, Meta, Starlink have programs to give things away to poorer countries in the name of “education” or to provide “access”. The old drug dealer model never gets old...give it away until they are hooked... ahhh I mean, until the Market is established.
Auntie Mame (NYC)
@Kevin In other words articles aobut global warming are nothing but fantasy land.. because the entities that could do something perhaps about population growth won't becuase billionaires want to be trillionaires?? and no luxury tax on the overpriced aitems they purchasehere and there. and lower taxes on cap gains..and Lord knows what else.
fierycloud (Taiwan, R.O.C.)
How about the items listed as 5D992.c such as OS and Office affected by the export control black list since the list are often the major official subscription users in the countries or areas. " Mass Market encryption hardware products are classified as ECCN 5A992.c, Mass Market encryption software products are classified as ECCN 5D992.c. With the exception of embargoed countries, these products may be exported without further license with respect to the Export Administration Regulations (EAR)."
The House dog (Seattle)
The problem is tech doesn't have any new products. Their imagination is closed. Marginal improvements to existing systems is not the innovation that created all that wealth. At some point the balloon deflates and it just happens to coincide with the rest of the sadness in our economy.
Joe (California)
Who could think we would go through a pandemic with millions who would be homeless without government assistance, followed by a major war we didn't ask for in Europe started by a major energy supplier, possibly followed by another war in Asia, without suffering some economic inconvenience?
Doug Fuhr (Ballard)
@Joe Most Republicans are running on exactly the theme that all the stuff you mentioned should have no economic impact. Things are going to heck, Joe Biden is President, it must be his fault, and the fault of the rest of the Democrats. Never mind that Trump, Qanon, McCarthy and the rest did their level best to make everything worse. Take off your mask and here, have a shot of bleach....
Indigo (Brooklyn)
Maybe people are losing interested in their products? Does Tech release their P&L's to the public, explaining how inflation is hurting them, or it is hurting the user who no longer wants to spend money on 'extras'? We will not know but they will certainly assert that the economy is going to collapse because their earning are slowing from billions to billions. Is there a non-hysterical adult in the room?
Tom (Frederick, MD)
Am I supposed to feel sorry for big tech? Are they really a sign of whether people have jobs or can make ends meet? Or are they the distraction?
Chicago Guy (Chicago, Il)
Modern capitalism isn't about making money. It's about making more and more money with bigger and bigger profits every year - forever. "How much money did we make last year?" "All of it!" "Well, you're going to have to do better next year or else!"
Marston Gould (Seattle, WA)
@Chicago Guy at some point, the only way to achieve that is inflation. Wait what?
Old Lymie (NYC)
Tech remains an evolving sector, albeit primary. Look at one of the great Himalaya peaks of tech — Facebook, hilariously re-named Meta, repositioned to capture a (wholly so-what) dead-end headset-wearing market. Adios, Zuck. Bad bet. But tech — except for the nuts and bolts part — is all about brief or brief-ish eruptions. Even Google may not survive; some random AI genius will certainly come up with an algorithm that will cause Google to evaporate. Who knows if the dynamic, albeit soft, side of tech will ever stabilize (except for the nuts and bolts part). So far it’s a free for all. And quantum will make all contemporary tech look like hobbyist endeavors, and charmingly retro, like Pong. I’d say the tech sector may be sending out worrying signals about the economy, but the longer look is that tech’s allure is pretty much suckering the economy. Except the nuts and bolts of tech.
Mark Lewis (Sierra Nevada foothills)
@Old Lymie What are talking about? The return of vacumn tubes? More like cyclical retrenchment that is predictable as dervitaves and pandemics.
Animales Espirituales (Fantasyland)
What do you mean about pong? What's an example of the advances you for see?
Mike O (USA)
Seen the price of a Western Electric 300B or 421a vacuum tube lately? Maybe we should return to them.
MLD (Portland)
Well, like most businesses, they can re-consider their costs, included their staffing levels and executive compensation and adjust accordingly. That’s what people do. If corporations are people, they can do the same.
Mark (L.I.)
Wall Street expects continued growth. It would be like a great baseball player having his batting average going up every year, during a 20 year career. It just doesn’t happen.
Paul from Oakland (SF Bay Area)
semiconductor company sales are lagging? Now, how can that be when all throughout 2022 the auto companies were explaining to us that there was a terrible chip shortage, so naturally with supply and demand, new vehicles were going to cost a lot more. And exactly what were US chip makers moaning about they can't keep up with chip demand and please US government hand over 50 billion dollars in our taxes so they can build more chip plants? I say claw back that 50 billion give away and set up a fund cities to set up their own electricity and gas distributions. The city of Sacramento has done that and sells electricity to its residents at 2/3 the cost that Pacific Gas and Electric charges in the next county. Yikes! Local government utility ownership actually works for the benefit of working people!
Alex (Seattle)
@Paul from Oakland a lot of the chip shortages were for less advanced chips that had tighter profit margins. They stopped manufacturing them after the early pandemic squeeze in order to retool for more advanced chips. The more advanced ones are in less demand now.
jagudada (Palo alto)
I don't understand why we think these results are "worrying", revenue and profits do not always keep on going up. This is to be expected given the uncertainty. In fact its important to have a slowdown to correct the excesses of the last 5 years.
Bill G. (Washington)
@jagudada this is a great response. I wanted to add that the rest of the economy is preparing for recession. The businesses mentioned get the majority of their income from business and working people. If inflation, interest rates and corporate tightening are all reducing budgets for digital marketing or high end technological infrastructure you would expect a decline in revenue from companies that provide those services.
Patrick (NYC)
At what point do people decide that they have enough devises, tech fatigue, and are no longer going to line up at midnight for the new iPhone? Social media may be a distant memory in less than a decade.
mbl14 (NJ)
@Patrick if we don't destroy ourselves first, not a chance. we are moving towards virtual reality.
Gui (New Orleans)
"Apple has said it plans to be more deliberate about how it expands its work force as the economy struggles." One wonders what they were doing up to now.
Bob The Builder (New York City)
Which one is it, then? Is it the Fed raising rates, or is it all these Big Name tech companies not having come up with a single original idea in 10+ years? Apple makes its profits by over-pricing iPhones and iMacs. They've reached the upper limit on prices. Microsoft keeps releasing the same version of Windows, but with a different number. So much for "innovation". Tech has become an empty shell of marketing and hype. It was only a matter of time before the public noticed, and voted with their wallets. Google sells ads. If marketing budgets take a dive because of belt-tightening, so will Google's revenue. I have no idea what Meta - née Facebook - really does. Metaverse I guess. Amazon is not a product company - regardless of their ambitious claims. Amazon is a retailer. The only way they can grow is by acquiring other retailers, or taking a cut from their Marketplace.
Xolotl (USA)
@Bob The Builder Amazon is a product company. Its cloud-computing product, AWS, is #1 in cloud computing. AWS generates about 3/4 of Amazon's profits. Amazon is a cloud-computing company that does a little retail on the side.
Cardinals (Louisville, KY)
@Bob The Builder I respectfully disagree with everything you wrote. MSFT does a lot more than sell windows which it doesn’t really do anymore. Alphabet is way more than just selling ads. AMZ has many different businesses beyond facilitating online retail. All of these companies have innovated in various ways over the last 10+ years. Good luck.
TK (Los Altos CA)
@Bob The Builder what American company is a value-providing company in your mind? John Deere? The Chinese are working on a version that costs a fifth. It lasts half as long but who cares.
dln (Northern Illinois)
Big tech is sure not new tech. Kids turn into young adults who then turn into parents who them get older and on it goes. Once you owned a cell phone, then it came with apps, and yet it is still a phone. Unless you have a special need for an app, you stop chasing marginal improvements over what you already have. The failure to protect personal data, selling your data and finally the inability to provide secure sites has made interest in tech way less cool than it used to be. Big tech is a train wreck. PS - I kind of like reality and am struggling with the whole avatar/pretend world thing but maybe it is the next big thing. Though can't quite see how you will multi-task work and home life in an alternate world while working.
Jerry (Amsterdam)
According to Mark Zuckerberg it’s apparently fundamentally important to the future to be able to run around in a cartoon like environment, even if it will cost billions to create this environment. Talking about priorities.
Michael (Ann Arbor MI)
You left out all the real energy needed to create this virtual world, as well as the server plantations keeping bitcoin alive from moment to moment.
LaurenceB. (Portland Oregon)
Honestly, I don’t get why Apple is valued so highly. They mass produce a product which now is so widely available and last so long that they are everywhere and an individual can spend under a $100 a year and maintain that product pretty much indefinitely. My four year old phone works great and will likely go on working well for years to come. I spend far more money on my Comcast subscription for a signal over the course of a year than on my phone. I don’t get it?
InFact (Novato, CA)
@LaurenceB. Perhaps you "don't get it" because you failed to note Apple has diversified and expanded its revenue streams considerably in the last few years. Apple still relies heavily on iPhone sales for a large percentage of its profits, but increases in services, iPads, computers, etc. have buoyed the company.
LaurenceB. (Portland Oregon)
Thanks for replying, but there are millions of iPads and computers out there and eventually you will be able to buy a perfectly usable one for $10 at a thrift store. Unless they come up with something way more innovative I continue to believe the stock is way over valued.
Jay Ryan (San Francisco)
@LaurenceB. No kidding. I survive just fine with my iPhone 5SE. They started slowing down the data on the 6, but 5SE works great. It runs al the common Aps just fine...google, maps, YouTube, sky view light, etc. The guys at work make fun of me because the 14 has a better camera and more storage. I download my photos to my computer every 6 mo or so, and the photos look fine to me. My iPhone battery lasts 2 days between charges. In the end, the only 14 benefit the guys can come up is the "camera quality". Almost all the rest of the tasks are down equally well by my antiquated 5SE. More sophisticated tasks are handled by my computer when I'm at home or at work. Apple is hardly a center of innovation anymore. They need new ideas or maybe another breakthrough product...something better than the redundant "meh" Apple Watch.
evenLove (NYC)
The irony of all this is that it’s their business model that has led to the internet and cell phones feeling like slot machines. Somehow Wall Street prizes their ad game (oh no profits are down a few billions, let’s add more blinking widgets and like buttons somewhere) while just about every psychologist and social scientist on the planet is, umm, suggesting that this is exacerbating many problems. Humanity is still not out of its adolescence. America is only halfway to great
DDH (VA)
Half of big tech are magazines that are growing stale. Amazon is a retailer. The others are producer retailers. Business cycles apply to them like other home appliances. It's over for Silicon Valley. These things happen.
Mark McIntyre (Los Angeles)
There is much concern, even among economists, the Fed is over-shooting the target. What's happening in tech may be evidence. It takes months for rate increases to be felt, but we're already seeing it. We're actually doing much better than most countries thanks to our strong dollar. This isn't the kind of inflation the Fed is accustomed to dealing with. Inflation is global and there are too many factors the Fed has no control over. Putin's war has upended everything, along with China's lockdowns and strife everywhere you look in the world. Can the Fed engineer a soft landing? It's looking more like stagflation.
chipEd (Ipswich,)
This whole economic stress is manufactured. Big corps. Are raking it in. Inflation, which was always there, is now noticed.
Tim T (Virginia)
@chipEd forced recession is the point of what federal reserve is doing to slow and reduce recession. Fed can’t increase supply of oil, food, or housing, they can only reduce demand for them (through recession and making money more expensive). Also, big tech got big bc they basically got financed by fed money over the past 14 years and even if fed stops raising rates and continues quantitative tightening, the slow down and repricing of big tech will continue for years to come, while quantitative tightening is continuing. Stock market bubbles are created and destroyed by federal reserve.
Tamzaa (NoCal)
in the early years semiconductors sales used to grow at over 30% annually, for several years. And then go negative growth for a year or two, and then keep going. I think these 'today' tech companies are also reaching a stage 'zero growth'.
Truth at Last (NJ)
The President should publicly state that the Fed should back off the next rate increase or they will cause a recession.
Tamzaa (NoCal)
@Truth at Last We have lived on fumes for over 15 years; the longer you wait the bigger the bust. NOW is as good a time as any. I say RAISE taxes on these tech companies, which are nothing but 'faster' yellow pages. AND while at it lets start cancelling tax-free status.
Blue In Texas (Austin)
FAANG as Wall Street calls them: Facebook Apple Alphabet, Netflix and Google are some of the more sinister companies in Silicon Valley... I worked in tech for a bit and it's all planned obsolescence with hardware and software....
TK (Los Altos CA)
@Blue In Texas the N in FAANG is actually Nvidia. Nobody cares about Netflix.
Gary (Cali)
I don't get the semiconductor down turn. Weren't they screaming for chips just a few months ago? Cars sitting on lots or sold with IOUs? And with the push for more electric vehicles and replacing fossil fuel burning with heat pumps, seems to me you need microprocessors and analog sensing.
PATRICK (Pennsylvania)
Well, isn't this all good news for our nation as many products are foreign made. This reporting means the trade imbalance will reduce, exascerbated by Chinese limits on their own country, and employment is terrific, people have money. I can make a few recommendations; remember long ago when banks paid us interest for our savings and now we pay them for overextended credit? So everyone try to put money in locally invested savings, insist on it, and before you know it, many people seeking higher interest through competition will make it happen. You can also invest in home Solar and Wind generating equipment now before the horrors of high fossil fuels prices. Solar and Wind are free energy. You only need to buy equipment just like furnaces and heat pumps but you don't have to pay for fuels for decades. That's mighty big savings in itself.
Aran (Baton Rouge)
I occasionally look at the list of cookies that have collected in Safari, and Facebook and Google repeatedly form a long list. I open Facebook once a month at most, and Instagram twice a week in a private browser. There's zero reason for Meta to follow me across the internet. If a decline in sales means less...everything bad that both Meta and Google do, fine by me.
Aran (Baton Rouge)
@Aran As a side note, it's worth mentioning that if Instagram and Facebook had stayed in their lanes (i.e. not abandoning the photography-focused roots of the platforms in failed attempts to follow TikTok's video success), perhaps they'd still be doing better now.
AKJersey (New Jersey)
Tech stocks have been greatly overpriced. They’re due for a correction. That may provide a buying opportunity.
InFact (Novato, CA)
@AKJersey Correct.
James Cornelio (Ct)
The good news is that if there is too much decimation in the earnings of Big Tech, and stock market valuations, the Fed will, as it always has in the past, step in with a whole bunch more money printing so that asset values soar and consumers get a whole bunch more cash to spend. Or maybe not. Maybe that Ponzi scheme has finally reached its endpoint. If so, watch out.
Todd Allen (Denver, CO)
"Microsoft said on Tuesday that Azure sales increased 35 percent" Maybe some realistic expectations among investors might be in order. Not only do they expect constant growth, they seem to expect constant growth of the growth rate. That's totally unrealistic. Things go through expansion and contraction, and that includes profits. That is normal, and what's really destructive is companies going into a panic when there's a totally normal bump in the road, or in this case, a perfectly normal contraction back from the massive demand for their services induced by the pandemic. That wasn't a normal state of affairs, and so anyone could (and should) have seen a contraction coming afterwards.
JBD (Florence, MA)
@Todd Allen I agree. And that panic often translates into layoffs out of fear of investor panic. The model does not lend itself to the inevitable boom and bust cycles.
Tired Blossom (Hawaii)
@Todd Allen I lived in Boston in the 80's and I remember the "high tech" companies that eventually disappeared. At least Digital has an ongoing credit union that rocks. I'm a dinosaur, but. who are using PC's anymore?
Carlyle T. (NYC)
From what I understand Apple is developing AI and VI probably thinking one day that we can just point our Iphone at a stranger and their name C/V and address will appear that is if they have ever appeared in any digital media, ditto the price of any item that the Iphone is pointing to. In the Iphone 14 the camera is terrific but hardly a word about this , somehow I feel Tik Tok may go nto phone designs .. time will tell and not just on an Iwatch.
Scott (Dayton, Ohio)
I work in tech and don't care for Meta. But they did one thing right: there was an anti-competitive wage cap on tech salaries, even Intuit, Apple, etc, were sued and lost. Meta gave us in tech surgeon salaries and forced the hands of Big Tech to pay up or shut up. It's given me and many others in tech a life we cannot be grateful enough for. Remote work in the middle of the country and getting a paycheck from the West Coast which can afford a lifestyle you had to own a lawfirm or big business in the Midwest to achieve. Them going down feels good but means more unemployed top talent to compete with
L (Loc)
Who cares? I can’t wait for the layoffs. Having to compete with the obscene salaries of these people who produce democracy destroying spyware has been intensely frustrating for everyday workers, especially when it comes to housing.
Eleanor Potter (Central Coast California)
@Scott as a real surgeon I’m pretty much disgusted with what you tech bros have done to our profession while you sit back oblivious to the needless pain and suffering, not to mention incredible unnecessary expense, you’ve caused. How many legislatures and lobbyists did you have to pay off to ensure we’re all forced to use your worthless yet incredibly expensive electronic health systems that endanger hundreds of people daily? Medicine in the US has become a laughingstock with the worst outcomes in the industrialized world because of your brotherhood going around destroying things. But hey. Do enjoy yourself.
Nick (California)
Thanks for helping out a democracy-destroying corporation for a big paycheck.
Frank Talarico MD (PDX)
Maybe people are interacting more in person? Tech is no longer novel. Also, entertainment choices are competitively abundant. Netflix rebound proves content is most important.
Eugene Gorrin (Union, NJ)
I’m still waiting for my transporter to replace my jet pack and flying car. Oh, a Time Machine would be wonderful too. Start inventing new stuff we can use on a daily basis. Tech companies: what are you waiting for?
PB (NJ)
The high growth rates for these already large companies isn’t sustainable, nor should it be. That just concentrates too much power in a few hands.
MIKEinNYC (NYC)
People, as the Fed intended, are holding back on buying stuff, including tech stuff. But when this lull is over and people feel a need to upgrade their electronics, that segment of the tech industry which has legitimate, useful products to sell, like Microsoft, Google, the phone and chip makers, will flourish and see a rush. The waste-of-time companies like facebook and Twitter, will continue to decline as people will come to realize that they can live without them.
Charles (New York)
@MIKEinNYC Yes, and perhaps advertising revenues are down due to the sheer proliferation of online media outlets slicing up advertising budgets as well as, given the problems many of these outlets are having, companies now deciding the ads aren't bringing the value-added for the money spent. There's a lot of worthless "clicks" out there.
Socrates (Downtown Verona, NJ)
"The industry’s slackening started with a downturn in online advertising sales. The cracks in that business began to form early this year when Apple introduced privacy changes that made it harder for Meta and Snap to target their digital advertising." Apple deserves a giant round of applause for implementing some basic privacy features on their phones. And another round of applause for helping collapse Facebook into itself. Now the United States Congress should do its job and implement some real privacy laws that protect United States citizens from corporate internet vultures, scam artists, data dragnets, spam email and everything else that makes the internet awful and repugnant. The internet doesn't have to be awful as it is.
Great Scott (Minneapolis)
And then there's Apple's hundreds of Billions in tax-free profits (and others companies) in Ireland. People still buying everything Apple does is good.
SirJohn (California)
@Socrates Privacy in the US and wide open doors to user data in China.
Xolotl (USA)
@Socrates A giant round of applause for the greediest one of all?
bubba (TN)
The democratic party narrators will tell you don't worry, be happy, because 1) the inflation is world wide, and 2) there are other countries doing worse than US.
zeke27 (Hudson Valley, NY)
It's sorta weird that these tech companies make billions in quarterly profits, but as soon as the rate of their profiteering falls. they claim the sky is falling. The media runs with the doom and gloom. Meanwhile, construction materials, HVAC equipment. insulation and other improvement products are back ordered for months. The infrastructure money has yet to hit the streets. and billions of dollars of school construction money is waiting to be spent. The economy is twisted but is a lot stronger than the bad news media will let on. The biggest problem is food and fuel. Greed rules there as does our backwards infrastructure that requires fossil fuels to keep the lights on.
Blue In Texas (Austin)
Greed indeed
Mannley (Florida)
Seems to me the fed is trying to get results like this, no? And this is more the result of their actions rather than inflation.
Rich888 (Washington DC)
Meta - Facebook is on the brink of failure brought on by the raging incompetence of its Founder. Remember the lunge into crypto? The ill-fated Libra project? And now the cringe inducing VR project that looks like a stalkers dream. The rest of the big tech pack seem to be undergoing a correction from a period of Covid-induced unsustainable growth. We’re going outside and consuming services again. But their underlying business models seem fine. Investors need to reset their growth expectations back down to earth.
Eleanor Potter (Central Coast California)
Seeing how these companies have gone a long way toward destroying real capitalism and certainly injured democracy, knocking them down several pegs is certainly to all of our advantage.
Darth Vader (Cyberspace)
@Eleanor Potter: Do you think the replacements (e.g., Tiktok vs FB) will be any better? They are all capitalists.
Eleanor Potter (Central Coast California)
@Darth Vader Google, Facebook/Meta, Salesforce and the lot are virtual monopolies. That flies in the face of competitive capitalism.
Mark A (St. Paul)
Thank you, Apple!! I really cannot type enough exclamation marks, so I’ll stop at two: “The industry’s slackening started with a downturn in online advertising sales. The cracks in that business began to form early this year when Apple introduced privacy changes that made it harder for Meta and Snap to target their digital advertising. On Wednesday, Meta warned that it didn’t see any relief on the horizon to the declining ad market.”
Kevin (Chicago)
@Mark A Ahh Apple my pet peeve.The Cadillac of the industry made in the wrong country.
Mark A (St. Paul)
@Kevin If you find any device made elsewhere, let us know.
Bobby V. (Nyc)
Couldn’t be happening to a more morally bankrupt company. Legit tried to destroy the American democracy fanning the flames of fascism and white supremacy for profit. The quicker they go out of business the better.
mbl14 (NJ)
@Bobby V. as long as Twitter goes with it.
Bill (Detroit)
@Bobby V. Give me a break. They did everything possible to suppress news favorable to the right, including censorship. Hunter Biden is just one of many instances. Big Tech literally did just the opposite of what you are asserting.
Mark A (St. Paul)
@Bill Both points of view are true, because the algorithm serves up the stories it thinks a reader wants to see more of, whether train wrecks of the right or train wrecks of the left.
Jerry (Birmingham, AL)
I'm ok w/ Meta losing $
Rob D (Oregon)
@Jerry Meta is not losing money yet, only its profits are down. But I take your point. The illusion may be finally shattering that a 30-something year old who made a lot of money is someone to pay attention to as a visionary.
Xolotl (USA)
@Jerry It's likely bad for your retirement accounts.
Joe (New York)
@Jerry I'm okay with them going out of business entirely. The world would be a far better place.
Taylor (Brooklyn)
Big tech was wildly inflated from the start of 2020 (pre-COVID), so only makes for a wild correction. This should come as no surprise.
Anonymous (DC)
The stock prices of tech companies are declining partly because of higher interest rates. Such companies are likely to hold their costs down for the moment, and will experience increases in stock prices as soon as interest rates show a downward trend.
Bruce (New York)
Bankrupting the economy. Isn't that the Feds plan?
Mark Lewis (Sierra Nevada foothills)
@Bruce USA economy was product driven in the good old days. Now, it’s built on speculation masquerading as expectations. The only people producing anything are hedge funds, Kardathians, and influencers. The Fed is simply a conductor.
Bilbo baggins (The shire)
@Bruce big tech is bankrupt? Did you read the earnings listed in this article or just making up things?
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