Big Tech Surges Ahead of the American Economy

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Profits for US tech giants- Amazon, Apple, Facebook- surge as they have reported considerably high returns earned in the last quarter. This is reflective of how these companies will be able to augment their wealth even as the pandemic continues to ravage through the world and antitrust regulators mount opposition against them. The current crisis might act as a catalyst for the unprecedented profitability of these industries. Jointly these companies reported a net profit of $38 billion.

Unprecedented Growth and Profits

The boom of online shopping -which was already exponentially growing prior to the health crisis- led to the unprecedented Amazon sales.  Amazon reports an almost 200% rise in sales revenue. Amazon sales augmented by $96.1 billion and profits by $6.3 billion. The infrastructural advancement that aided this growth also needs to be acknowledged.  This successful quarter is a product of the incorporation of a significant number of technological feats. Cloud computing, digital advertising, e-commerce have been significant in spearheading growth and success. Similarly, although the release of iPhone 12 was delayed due to the pandemic, Apple recorded high sales numbers. A 30% increase in sales was also recorded by Microsoft. Facebook recorded a 22% increase in revenue this quarter compared to the previous year. This amounted to around $21.2 billion in profits. The profits are set to rise exponentially as the Facebook app family expands and the daily use of these apps by people contribute to further increase in revenues.

Optimising Profitability in the Coming Months

Dan Ives, Managing Director of Equity Research at Wedbush Securities noted, “The scene that’s playing out fundamentally is that these tech stalwarts are gaining more market share by the day.” The upcoming holiday season is also expected to double their profitability as there will be a definite surge in online shopping on platforms like Amazon. The expected advertising traffic during this season is also projected to grow, this will mean enhanced chances of profitability for Google and Facebook. The release of the new iPhone will boost sales further for Apple. Hence, the upcoming months offer additional hopes of augmenting revenues for these big tech giants as the economy shows signs of improvement.