The company called Meta, which includes Facebook, Instagram and WhatsApp, announced that it would lay off its employees to reduce costs, and the value of its stocks flew.
In 2023, when many investors expect it to be a tough year, two big tech companies gained more than 100 percent in five months.
Social media giant Meta Platforms and semiconductor maker Nvidia have doubled their prices since January, making them the two best performing stocks in the S&P 500.
The value of Facebook’s parent company Meta has increased 102 percent since the beginning of the year. The cost cuts, which CEO Mark Zuckerberg called the “productivity year”, caught the attention of investors. The company announced that it would lay off tens of thousands of employees to increase its profits.
AT THE END OF THE YEAR, IT HAS RELEASED 11 THOUSAND PEOPLE
Meta, which owns platforms such as Facebook, Instagram and WhatsApp, laid off 13 percent of its employees in November last year. The company, which made mass layoffs for the first time in the last 18 years, had 86,482 employees by the end of 2022.
AI DOPING
On the other hand, the interest in artificial intelligence caused the shares of Nvidia, the chip manufacturer, to gain 106 percent from the beginning of 2023 to today. The intense interest in technologies like ChatGPT has increased the demand for chips for high-density AI computing. Nvidia is the manufacturer of the two most used chip types in artificial intelligence studies.
The S&P 500 index is up 8 percent this year, but extreme gains in Meta, Nvidia and a few other high-performing tech stocks accounted for nearly all of the index’s return.
Alongside cost cuts and the rise of AI applications, Meta and Nvidia are also thought to benefit from the growing belief from investors that the Fed is poised to end its fight against inflation.
Due to the Fed’s aggressive interest rate policy, Meta’s value fell 61 percent last year, while Nvidia’s value fell 45 percent.