Following the company’s second-quarter earnings call, Meta joined Alphabet and Microsoft in releasing its disappointing quarterly financials. In a week of gloom for mega-cap stocks, all three have lost revenue and earnings expectations, with Meta reporting its first quarterly sales decline.
financial crisis
Due to the current global economic slowdown, markets had predicted that earnings of mega-cap stocks, which account for 40% of the Nasdaq and 30% of the S&P 500, could face bloodshed.
However, although earnings disappointed, and came in worse than expected across the board, some analysts suggest the situation could be even worse.
The International Monetary Fund (IMF) recently announced that it revised its 2022 global GDP forecast from 3.6% in early April to 3.2% now for the rest of the year.
This seems to have been reflected in earnings reports released by three of the world’s biggest tech companies.
Alphabet
Google’s parent company Alphabet was one of the first companies to release earnings this week, with figures lower than expected.
The company reported that revenue for the second quarter rose 13% to $69.7 billion, well short of an estimated $70.8 billion.
Q2 earnings came in at $1.21 per share, which was below the consensus consensus of $1.27 per share for the quarter.
Microsoft
Microsoft also fell short of expectations, with both earnings and revenue figures disappointing for Q2.
The company founded by Bill Gates reported earnings of $2.23 per share, compared to normal expectations of $2.29 per share.
Quarterly revenue was reported at $51.87 billion, lower than analyst forecast of $52.44 billion.
meta
Finally Meta, formerly Facebook, also reported disappointing financial results for the second quarter of the year.
They confirmed that total revenue for April-June stood at $28.82 billion, slightly below an estimated $28.94 billion.
EPS, earnings per share of $2.46, was reported against expectations of $2.56 per share, which comes despite expectations of 1.97 billion versus 1.95 billion of daily active users on Facebook.
Following the earnings call, CEO Mark Zuckerberg said that, “it appears we have entered an economic downturn that will have a massive impact on the digital advertising business”.
Amazon and Apple are the next two mega-cap stocks to release their earnings release later today, do you expect this trend to continue?
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