A day after their CEOs appeared in front of a Congressional committee to reject allegations of being anti-competitive, Big Tech – Alphabet, Amazon, Apple and Facebook – “all hit match-winning home runs”, in the words of one analyst, with their Q2 results.
Amazon was, as expected, a big winner as the COVID-induced lockdowns around the world contributed to a 40% sales increase for the three months to end June. And as new shopping habits are expected to stick, there is still further growth to come.
Facebook revenues were up 11% and the number of people using its platforms (Facebook, Instagram, WhatsApp) rose 15% in the same period.
Quarterly revenues at Apple, meanwhile, rose 11%. The company has been shifting to a services model, but remote working and home schooling drove a demand for new devices.
Alphabet was the only one of the four not to report a revenue increase: sales were down 2% year on year as businesses cut back on ad spending, but this was still less than had been expected. Alphabet-owned YouTube, though, did see growth, rising 6%.
With the impressive quarterly results coming so soon after their appearances in front of the committee, the CEOs were careful in their public pronouncements.
“We’re conscious of the fact that these results stand in stark relief during a time of real economic adversity,” said Apple Chief CEO Tim Cook on a conference call. “Especially in times like this, we are focused on growing the pie, making sure our success isn’t just our success and that everything we make build or do is geared towards creating opportunities for others.”
Amazon’s Jeff Bezos noted that revenue from small sellers on the platform was growing faster than sales of its own products; Facebook COO Sheryl Sandberg stressed the usefulness of Facebook for small businesses who are having to go online like never before; Alphabet CEO Sundar Pichai acknowledged the need for scrutiny, given Google’s size.
While Republicans and Democrats in Congress seem unlikely to agree a way forward, that scrutiny will continue in the US and elsewhere. The Federal Trade Commission and Justice Department are also looking at Big Tech as are the attorneys general from several states; antitrust suits could be brought before the end of the year.
“Whether it’s because there's a monopoly, or because their products are truly modern marvels, the numbers show consumers are still voting in the companies’ favor in the most important sense,” said Bloomberg’s Ian King.
“Even as budgets tighten, people are spending more on tech.”
Sourced from BBC, MediaPost, Business Insider, Bloomberg; additional content by WARC staff