Big Tech Firms Report a Record Second Quarter

Amazon reported its greatest profit margin in history, while Facebook, Apple and Alphabet.com also beat analysts’ expectations.

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Thursday was notable both as the first day on which all of the ‘Big Four’ tech giants posted their quarterly earnings, and as the day following a Congressional antitrust hearing in which the billionaire CEOs of those four companies faced accusations of abusing their market dominance.

Amazon reported its greatest quarterly profit since the company’s founding, earning a net $5.2 billion; more than doubling its gains from the same period in 2019. The surge came despite fears that Amazon would report a loss, owing to its $4 billion expenditure on personal protective equipment for staff and other preventative measures against COVID-19. Amazon’s online sales during Q2 totalled $45.9 billion, a 48% increase.

This was another highly unusual quarter,” CEO Jeff Bezos said in a statement.

Despite a highly publicised boycott by major advertisers over concerns about the inadequacy of its rules against hate speech, Facebook reported ad sales of $18.3 billion, up 10% from Q1. While some of its highest-paying single advertisers moved away from the social media platform, the bulk of Facebook’s ad sales – which in turn make up the bulk of its revenue – come from smaller businesses. As a result, Facebook’s total revenue saw a jump of 11% in its Q2 report.

Apple’s quarterly results were equally striking, with revenue gains across every category. iPhone sales beat analyst expectations by $4 billion, and its less-popular iPads and Macs also saw a sales boost. The company also announced a 4-for-1 stock split in a stated attempt to keep shares accessible to a range of investors.

Google parent company Alphabet.com was the only company of the Big Four to post a loss, the first in its history. Revenue fell to $38.3 billion from $38.94 billion – but even this beat analysts’ predicted revenue of $37.37 billion.

Alphabet.com’s share prices saw a negligible rise following the release of its quarterly report. Meanwhile, shares in Amazon and Facebook climbed by 6% in extended trading, while Apple shares rose by 5%.

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