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Tuesday, March 21, 2023

Three Tech Giants, Apple, Amazon and Alphabet Report Poor Results

Apple missed analyst expectations on profit for the first time in seven years

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UNITED STATES: A day after Facebook owner Meta defied the depressing technological trend and posted better-than-expected results, the A-Team of big tech, Apple, Amazon, and Alphabet, all posted poor results on Thursday.

After the company released a dismal first-quarter earnings report on Thursday that included unusual misses on revenue, profit, and sales, Apple shares fell more than 4%.

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After severe COVID-19 lockdowns and associated demonstrations in China disrupted Apple’s iPhone production at its major supplier. Apple missed analyst expectations on profit for the first time in seven years.

The firm reported $117.2 billion in revenue for the quarter, a 5.49% decrease from the previous year’s record-breaking Christmas sales. 

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This was the corporation’s greatest quarterly revenue decline in almost seven years. The amount was less than the $121.10 billion average analyst expectation.

In a press release that was released along with the findings, Apple made a stunning allusion to ongoing challenges.

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Strict lockdowns cost it $4 billion in missed sales in 2022 because 90% of the devices sold worldwide are produced in China.

In the increasingly unstable IT sector, Apple has long been seen as a safe haven for investment. However, analysts claim that this report indicates that the trend may be shifting. 

In its results call in October, the company had stated that it was expecting a slowdown, citing “continued uncertainty around the world” as the reason.

On Thursday, Amazon released lower-than-expected financial results, while Alphabet, the company that owns Google, saw its income suffer due to a decline in advertising.

The Internet and retail behemoth has announced 18,000 job layoffs as it struggles to recover from its epidemic boom. Compared to net income of $33.4 billion the year prior, it posted a $2.7 billion deficit for 2022. 

The loss included a $12.7 billion pre-tax loss on its investment in Rivian, a manufacturer of electric vehicles. Compared to 2021, net sales climbed 9% to $514 billion.

Amazon Web Services, the most dependable segment of the business, reported sales of $21.4 billion, up 20% from a year earlier but falling short of analysts’ expectations.

Alphabet narrowly fell short of analysts’ predictions, indicating decreased demand for its search advertising in a weakening economy. 

The company’s sales for the quarter totaled $63.1 billion, just shy of the $63.2 billion forecast.

Alphabet announced job cuts of 12,000 people, or 6% of its global workforce, last month and promised to become a smaller, more effective business.

The US Department of Justice then filed a lawsuit against the firm, accusing it of abusing its control over the digital advertising market.

The parent company of Facebook, Meta, will experience a turnaround as their profit figures are compared. 

The stock of Meta increased by as much as 26% on Thursday, marking the largest one-day increase in a decade.

Also Read: U.S. States Request Appeals Court to Restore Facebook Lawsuit

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