Pandemic? Antitrust? Doesn’t matter to Big Tech, which just reported nearly $200 billion in sales


Amid a global pandemic and concerted antitrust scrutiny, the Big Tech quartet in regulators’ sights are just getting bigger.

Alphabet Inc.


+0.97% Inc.

Apple Inc.
and Facebook Inc.

combined Thursday to report profit of nearly $29 billion on sales approaching $200 billion in the second quarter, the first full three-month period of the COVID-19 pandemic.

The four crushed Wall Street’s expectations as a group a day after a five-and-a-half-hour-long congressional hearing on anticompetitive practices in which their CEOs answered questions from Congress on their dominant positions in the marketplace.

Combined revenue for the four, excluding traffic acquisition costs or TAC for Google parent Alphabet, was $198.11 billion, with Amazon reporting the most stunning revenue and earnings beat after Chief Executive Jeff Bezos promised to spend all of Amazon’s profit on responding to the pandemic.

With more people stuck at home and relying on shopping online and working on cloud-computing power, Amazon’s net income was instead a record for the e-commerce giant.

Wall Street had been looking for the four giants to report a combined revenue of $181.5 billion, according to FactSet, compared with $165.7 billion in the year-ago quarter, excluding TAC for Alphabet. Combined revenue for the four grew nearly 20%.

Amazon’s earnings beat pushed the four’s combined net income to $28.6 billion, far surpassing analysts’ average estimate of approximately $19.04 billion, according to FactSet, and marking growth of more than 13% from $25.21 billion a year ago despite the pandemic.

Apple would not be impressed by Amazon’s record profit, as the iPhone maker recorded more than double Amazon’s earnings, surpassing $11 billion despite shutting down its Apple Stores in some geographies for some short periods due to the pandemic. The company also announced a surprise four-for-one stock split.

While Apple and Amazon flourished, there were difficulties for Facebook and Google, which rely on online advertising for their revenue, a category that could face larger headwinds from the COVID-19 pandemic.

Alphabet met expectations but display ads on Google were still in decline, producing a decline in Google’s ad revenue for the first time. Facebook, though, had the biggest after-hours jump in its stock price after it beat Wall Street expectations by topping $5 billion in quarterly profit.

The four companies combined were worth almost $5 trillion at the close, and all gained in after-hours stock trading toward even larger valuations following the earnings reports.

Source : MTV