The large American technology companies Microsoft and Google parent Alphabet fell hard on the stock exchanges in New York on Wednesday. Investors were disappointed with the results of the two tech giants, sending shares down 8.3 percent.
In addition, Facebook parent Meta Platforms, which comes with quarterly figures after the closing bell, fell 4.3 percent.
At Alphabet, revenue grew much less rapidly in the third quarter than in previous periods, as advertisers have become more cautious with their spending due to the poor economic outlook. At Meta, which also owns WhatsApp and Instagram in addition to Facebook, investors will also pay particular attention to advertising income. CEO Mark Zuckerberg’s company warned in July that revenues would also be under pressure in the third quarter.
Software maker Microsoft experienced the lowest revenue growth in five years as consumers bought fewer PCs with Windows licenses due to high inflation. The turnover of cloud services was also disappointing.
Microsoft, Alphabet and Meta leave a heavy mark on Wall Street because of their size and market value. The technology indicator Nasdaq was, therefore, 2 percent lower at 10,980 points shortly after the start of trading. The Dow Jones index rose 0.2 percent to 31,916 points, and the broad S&P 500 lost 0.6 percent to 3,836 points. Over the past three trading days, the US stock markets have shown a strong rally.
Spotify dropped more than 9 percent. The music streaming service also suffered from reluctance last quarter from advertisers who buy advertising time on Spotify. The company also spent more money on marketing and investments in podcasts and audiobooks. The company suffered losses as a result.
Food producer Kraft Heinz climbed 1.2 percent. The maker of, among others, ketchup brand Heinz and the cream cheeses of Philadelphia booked more turnover and profit last quarter than analysts had expected.
Boeing went down slightly. The aircraft manufacturer lost billions last quarter due to setbacks in its defence branch. This is because, partly due to the high inflation, Boeing had to incur many more costs for various military contracts than it was reimbursed. No inflation adjustment had been agreed in those contracts.
