After the drop in advertising revenue and the tens of thousands of layoffs decided in recent months, now the financial statements certify that something has changed for the technological giants. Alphabet (Google), Amazon and even Apple released disappointing quarterly results. The hopes of those who expected greater resistance from Big Tech were dashed. Even Apple, the only one that hasn’t fired anyone so far – CEO (CEO) Tim Cook has said that firing is his “last option to consider” – saw an 8% year-on-year drop in iPhone sales. Turnover at 117 billion (-5.4%) and profit at 30 billion (-13%). All figures lower than expected. A decline that the company attributes to supply chain (chip) problems, which have scuttled production.
Amazon, Meta and the 2023 year of efficiency
Amazon did not disappoint in the quarterly report, but CEO Andy Jassy did not hide his concerns about the macroeconomic scenario: “so far we have held up by reducing costs, but uncertainties remain in the short term”. Amazon fired 18,000 people in December. Meta 11 thousand. But the Facebook holding has scored a record day on the stock market after the publication of its quarterly: negative accounts, but increasing users. And that was enough to induce investors to look further.
The analysis
Apple is the only Big Tech that hasn’t fired anyone. The reasons
by Archangel Rociola
Whether it’s called Facebook, Instagram or Whatsapp or Metaverse, as in Mark Zuckerberg’s intentions. For him, 2023 will be “the year of efficiency”. Less waste and investments more focused on products. A sign of second thoughts, analysts warn. That certifies an ongoing change. Amazon, Google, Meta and the rest know that the golden age is behind us. And that there are years of struggle ahead to reposition themselves. Investing in innovation. Focusing on the new frontiers of technology. First, artificial intelligence.
The battle of the advertising market. And the unknown TikTok
During 2022, the social networking giant’s advertising revenue fell for the first time since it went public in 2012. Quarterly net income halved to $4.65 billion. Meta, together with Google, covers almost 50% of the global advertising market, recalls Afp. Their revenues have decreased due to the lower propensity to invest by advertisers.
The analysis
A new wave of startups is springing up from Big Tech layoffs
by Archangel Rociola
But also because many of them prefer to advertise on other platforms. TikTok is the number one suspect. Capable of attracting investments, new generations, and minutes, hours of eyes glued to the screen thanks to the short videos that have become its trademark. In a word: data. Billions of data. Digital gold for advertisers, who can thus reach an increasingly targeted audience.
Google and Snapchat, accounts in the red
Google also hurt. Alphabet’s quarterly revenue fell to $76 billion and net income fell 34% to $13.6 billion. The YouTube platform brought in less than $8 billion in ad revenue (a decrease of 7.8% from the previous year). Again, a clear sign that something is broken. Snapchat (accounts in the red also for Evan Spiegel’s social network, popular in the USA, a little less in Italy), Meta and Google are having difficulty generating profits as in the past.
Future station
TikTok is also going down the drain (the enshitting phenomenon)
by Riccardo Luna
Snapchat now has 375 million daily users, 17% more than at the end of 2021. Facebook, which seemed to be losing momentum, has reached two billion daily active users. His “reels,” a short video format essentially copied from TikTok, have their own audience, as do YouTube’s “shorts,” which have surpassed 50 billion “daily views” up from 30 billion last spring. But as users and views increase, revenue doesn’t increase to the same extent.
How Often Do Managers Say the Term “AI”
Profit margins need to be recovered. And do it fast. It has been said, the main road currently leads to the maze of artificial intelligence. All the big technological giants are aiming for that to raise turnover and recover the polish of frontier innovation.
A clue is provided by a quantitative analysis of the words spoken by the managers of the technological giants during the press conferences to present the financial results: all of them have pronounced words such as “AI”, “generative AI” or “machine learning”, ed. ) two to six times more often than in the previous quarter.
The stories
“Ciao, Silicon Valley”, the new Italian Tech webseries that talks about the future
by Giulia Destefanis
The executives of Microsoft and Alphabet, the two main players in the battle for AI, have made it a central theme. Alphabet referenced artificial intelligence 45 times, up from 13 at the end of the third quarter, surpassing Microsoft, whose conference call featured 39 references, up from 15 in the prior quarter. But references to AI have also been made by Snapchat, Meta and Apple, with Cook seeing artificial intelligence as a “useful tool to prevent accidents”, and which will be developed in the next iPhones.
Ai as a tool to generate original content (on social media)
More generally, and more looking at social media, for Big Tech AI can translate into more effective tools to make advertising more personalized; to improve suggested content; create content, if necessary, as ChatGPT and Dall-E have already demonstrated their ability to do. ChatGPT is funded by Microsoft, which in January unveiled a “multi-billion dollar investment” to boost its power and effectiveness.
Google for now seems to be chasing. But, as the chief Sundar Pichai declared, “everything indicates that the market is ready”. While Mark Zuckerberg hopes that generative AI will make it easy to create “videos, avatars and 3D images”, especially for the metaverse.
Contents. Maybe quality. Or at least able to attract the attention of the public. What these companies need to consolidate and increase their user base.
Twitter: @arcamasilum