The global software giants are holding back. In the first nine months of 2022, net profits decreased by 42% compared to the same period last year. This result is also reflected in the stock market value of these companies, which fell by 29.2%. This is the picture drawn by the annual survey of the Mediobanca Research area on the 25 main companies in the sector.
However, companies that were able to benefit from tax savings of 36.3 billion in the three-year period 2019-2021, thanks to the concessions they can enjoy in some countries, which reduce the overall average tax rate to 15.4%, compared to the theoretical 21.9%.
Profits collapse, but turnover grows
Despite the collapse in profits, the study center shows that aggregate turnover has grown by 9.1% compared to the first nine months of 2021. But liquidity is falling (-11.9%). And this is one of the reasons that has led these companies to try to cut expenses during the current year: above all, the cost of work with a heavy redundancy plan that has involved all the big names in the sector.
Mediobanca speaks of “downsizing” of the software giants. 25 companies were examined, all with revenues exceeding 12 billion euros; of these 11 are based in the United States, nine in China, two in Germany and Japan, one in South Korea.
Their revenues multiplied during the months of the pandemic, reaching their peak in 2021, only to then register a decline. The first real decline after the ride of the last ten years, records Mediobanca.
1,584 billion in turnover, equal to 90% of the Italian GDP
Companies that overall last year recorded an aggregate turnover of 1,584 billion, equal to 90% of the Italian GDP. The United States and China have shared most of these revenues: 67% of these are generated by American companies, 28% by Chinese.
Italy contributes 8.3 billion to the turnover of these companies, which employ 23,000 people in our country (11,000 for Amazon). They paid 150 million to the Italian treasury last year, for a tax rate of 25.1%.
However, the shadow of 2022 remains. Annus horribilis for technology companies. Which on the stock exchange have lost 29.2% of their value compared to the capitalization peaks reached in 2021 (8.6 billion), however enough to be worth more than ten times the entire Italian stock exchange.
The podium is still a three-way challenge between Microsoft (1.7 trillion), Alphabet (1.2) and Amazon (927 billion). But the gap with its Chinese rivals is narrowing, with Tencent now capitalizing on 340 billion.