over 3 years ago • 1 min
Amazon and Facebook both opened up their box of tricks to reveal better-than-expected second-quarter results late on Thursday, and investors initially joined in the celebrations by buying up their stocks 🎉
Amazon reported better-than-expected revenue thanks to a rise in demand for online shopping, and its profit massively outstripped forecasts as well – despite $4 billion worth of additional coronavirus-related expenses. Looking ahead, Amazon reckons it’ll earn more than investors forecast this quarter too.
Now to Facebook: the advertising behemoth revealed a bigger-than-expected increase in monthly active users, pushing its quarterly revenue and profit past forecasts. It turns out that when you have eight million ad partners to your name, big-name boycotts don’t actually have that much of an impact on earnings 🤷♀️ If anything, Facebook is more focused on the receding pandemic: the company thinks the recovery will keep active user numbers from rising as the year goes on.
Twitter’s weaker-than-expected revenue report last week hinted at still-slowing advertising revenue growth for social media platforms, but Facebook looks like it might’ve been hoovering up advertisers’ money at its rival’s expense 💵 That’s a strategy Amazon knows well: its own advertising business grew 41% – compared to Facebook’s 10% – and is now six times the size of Twitter’s overall.
On Wednesday, the US government challenged the CEOs of Amazon, Facebook, Alphabet, and Apple on the amount of influence they have. And with good reason: 35% of the world uses Facebook, while Amazon controls 40% of US ecommerce 🇺🇸 Big Tech may even be forced to break apart if the Democratic Party wins big in November’s US election – an increasingly likely outcome.
Disclaimer: These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment advisor.