Tech’s Terrible Week, in 10 Charts

Note

It’s really scary for the tech sector; terrible nice It’s been a very bad week. From semiconductors and social media to computers and the cloud; The world’s top-grossing companies report the many challenges they face. As unfavorable numbers flood in, investors take the news and sell.

Most of the biggest tech names managed to recover on Friday thanks to Apple’s relatively healthy performance. But the feeling was blurry.

Some hundreds of different data points are shared with the market. Integrated and strong backing; Supply chain tensions creep into third year A combination of inflation that remains out of control and economic growth figures that appear to be worsening are telling. We put all of this together in 10 charts — be sure to let us know what we missed!

The malaise in the semiconductor industry has led to Intel Corp., America’s largest chip maker. can best be summed up by identifying the disaster in Intel, a supplier of components for computers and servers, has been hit hard by the slowdown, with rival Taiwan Semiconductor Manufacturing Co. And Samsung Electronics Corp. is scrambling to adjust even as it promises to catch up. However, the cost will not be reduced. Time to help with the fourth quarter numbers.

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A year ago, the world was running out of chips, and suppliers were rushing to buy equipment and struggling to yield. Last month, they cut the 2022 budget by more than $16 billion, preparing to cut spending next year.

A recurring theme this season has been the impact of the rising US dollar relative to every counterpart. Among the hardest hit was Amazon.com Inc. And few companies are immune.

Apple Inc looks pretty strong compared to the rest. Although its iPhone touched below estimates and was bolstered by availability in a few more days. services including Apple Music and Apple+ TV; Services, the company’s second-largest revenue contributor, continued to report solid growth, albeit at a slower pace than previous quarters.

Meta Platforms Inc. is hitting from all sides. Facebook The owner of Instagram and WhatsApp has been hit hard by Apple’s changes to privacy rules, which make it harder to track users through apps and lower advertising rates. A global recession, including high inflation, adds to the woes. User numbers are picking up slowly, but its app family has 3.7 billion monthly active users – and average revenue per person is sliding.

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At the same time, The social media company is burning cash on its Reality Labs division, a transformation that prompted founder Mark Zuckerberg’s virtual reality and name change last year. That business has lost more than $20 billion to date, and Zuckerberg said he expects the investor shortage to continue for a while.

Alphabet Inc. It’s not doing well, but at least it’s growing. The 6.1% increase in third-quarter revenue was the slowest since June 2020, following the outbreak of the Covid-19 pandemic. Its Google search-based advertising divisions are outpacing its network affiliates and video service YouTube, while cloud services are strong.

Microsoft Corp. is weathering the storm better than most — a decade-long transition away from client computing — where revenue is directly tied to computer and server hardware sales. Revenue for the September period rose just 11%, the slowest in five years, but that was far ahead of most tech peers. Its cloud and productivity offerings are the main reasons for this relative strength. Consumers are somewhat wedded to its suite of Office products, although both consumers and corporates aren’t in a position to run to it when times get tough, those who subscribe to its Azure cloud services.

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The last two charts show how badly investors reacted to all this news. The stock market decline is global; It is an industrial phenomenon. But the technology sector fared much worse, with the Nasdaq down 30% over the past year.

Most are companies with a heavy reliance on advertising or short-term consumer purchases. The currency appears to have shifted to what it sees as more defensive tech stocks, with Netflix Inc. is the brightest among them.

If there’s any consolation, it’s that investors don’t have to worry about the fate of Twitter Inc. That’s Elon Musk’s problem now.

More from other Bloomberg Opinion writers

• The Chips Act doesn’t work without every part of the Chip: Thomas Black

• Money-Losing Airbnb hosts have three options: Teresa Ghilarducci

• Tim Culpan overreacts as tech investors clamor for Cloud

This column does not necessarily reflect the opinion of the editorial team or Bloomberg LP and its owners.

Tim Culpan is a Bloomberg columnist covering technology in Asia. He was previously a technology reporter for Bloomberg News.

More stories like this are available at bloomberg.com/opinion.

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