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Since the beginning of the year, Facebook, Apple, Amazon, Microsoft and Google have lost $2.7 trillion in market value.
In 2021, Meta posted revenues of almost US$118 billion.
In February, it acknowledged that the number of daily active users fell to 1.929 million in the last quarter of 2021.
Many major companies in the United States are preparing for the strongest impact they will receive from macroeconomic pressures, as this Thursday the United States Department of Commerce detailed that an inflation indicator rose 6.3 percent in May, compared to the same month of the previous year. Among the companies that prepare a containment plan is Meta Platforms, which announced that it is bracing for the impacts of a tougher second half of the year, given the economic downturn and data privacy impacts to its ad business.
And it is that very high inflation is putting pressure on American families, especially affecting large companies. According to data from Department of Commerceconsumer spending increased at a slow rate of 0.2 percent, from April to May, while consumer spending is starting to weaken in the face of high inflation, but is still helping to drive prices higher.
After the Department of Commerce of that country released that figure, Wall Street explained that its operations fell, registering low numbers in the Dow Jones index, at 1.71 percent, the Nasdaq yielded 2.85 percent and the expanded index S&P 500 lost 1.95 percent.
Meta prepares for impacts
Through an internal memorandum, released this Thursday by Mark Zuckerberg’s social network, the company announced that it must “prioritize more ruthlessly” Y “operate leaner, leaner, better-executing teams”; memorandum, appeared on the company’s internal discussion forum, Workplace, and was written by Product Manager Chris Cox.
“I have to stress that we are in serious times here and the headwinds are fierce. We need to run smoothly in a slower growing environment, where teams shouldn’t expect huge influxes of new engineers and budgets,” he wrote.
This announcement is the latest forecast made by Meta executives, who already in past months moved to cut costs and Halt hiring across much of the company in the face of slowing ad sales and user growth.
Met, which has not had a good year, was undoubtedly one of the strongest technology companies on the stock market and, according to data from your 2021 annual report, its worldwide revenue for that year amounted to nearly US$118 billion; however, for February the social media giant presented a weak fourth quarter 2021 earnings report, after experiencing its first decline in daily active users on Facebook. Overall, growth was uneven because of Apple’s iOS privacy update, along with the company’s transition to short-form videos, known as Reels.
Months later, Mark Zuckerberg’s company continued to struggle, this time for a reduction in advertising rates on your Facebook core business, which can create problems, refers to the latest Piper Sandler report signed by analyst Thomas Champion.
Recall that the world’s largest social media company lost about half of its market value this year, after Meta reported that daily active users on its flagship app saw a quarterly decline for the first time.
In his memo, Cox also said that: “Meta would need to quintuple the number of graphics processing units (GPUs) in its data centers by the end of the year to support the discovery drive, which requires additional computing power for artificial intelligence to arise. Facebook and Instagram posts in user feeds.”
As well as Meta, there are the majority of Silicon Valley companies, since the technology industry is one of the most affected by the strong inflation that is experienced in the United States and many countries. Facebook, Apple, Amazon, Microsoft and Google alone lost $2.7 trillion in market value from the start of 2022 through May 19, according to The New York Times.
Faced with this, technology companies, in general, have reduced their ambitions in anticipation of a possible recession. In 2021, these companies entered large numbers after the Covid-19 pandemic, according to a CNBC reportwhere he detailed that the largest technology companies (Amazon, Apple, Alphabet, Microsoft, Facebook, Tesla and Netflix) withheld per minute the first three months of 2021 a figure that notably exceeds 100 billion dollars.
The impacts that the economy has had around the world in recent years due to the Covid-19 pandemic, the war between Ukraine and Russia, the fall of cryptocurrencies and other global problems, has begun to affect various industries and countries, especially technology. This is how this negative effect has been shown in other sectors, where the main affected are the workers and people who depend on them for a living.
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