" alt="" title=""/>A week of blockbuster earnings reports from Big Tech culminated on Thursday with Amazon’s predictions of how much money would be made from pandemic-induced online purchases and increasing reliance on internet-hosted services.
The e-commerce giant is one of those internet giants whose businesses thrived as precautionary measures against COVID-19 and prompted people around the world to go online to work, train, shop and socialize.
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Amazon reported that its earnings tripled for the quarter that ended recently when online sales were booming.
Revenue rose to $ 108.5 billion, a 44 percent increase over the same period last year as the pandemic sparked the trend towards online shopping rather than in physical stores.
Income for the quarter was $ 8.1 billion compared to $ 2.5 billion for the first three months of last year.
The Amazon Web Services unit, which hosts services and data in the Internet cloud, saw revenue jump to $ 13.5 billion for the quarter.
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People and businesses turning to the internet have fueled the cloud computing market, where Amazon competes with Microsoft and Google.
Apple and Facebook reported rising quarterly earnings this week, essentially doubling year over year to $ 23.6 billion and $ 9.5 billion, respectively.
Apple was fueled by strong growth in sales of iPhones and various products and services, while Facebook saw a sharp surge in digital advertising, reflecting the increase in people’s internet usage during the ongoing pandemic.
The results followed what an analyst for Google and its parent company Alphabet called the “monster” neighborhood, which, along with Facebook, dominates online advertising. They also come after a solid report from Microsoft, a cloud computing and video game powerhouse.
The latest round of results is likely to lead to a closer examination of the growing dominance of big tech, especially as their services appear to be ready for banned consumers.
“The big tech companies are in the right place at the right time,” said Darrell West, a staff member at the Brookings Institution’s Center for Technology Innovation.
“Covid has accelerated digital transformation in education, healthcare, remote working and e-commerce, which has increased the profitability of these companies.”
The growing influence of big tech has led to calls for increased regulation, higher taxes, and greater antitrust enforcement to encourage more competition and counter economic inequalities.
Covid ‘shock’
Robert Atkinson, president of the Information Technology & Innovation Foundation, a think tank that often reflects the views of the sector, said technology giants are benefiting from the massive digital transformation that accelerated during Covid-19.
He claimed that companies have been making such profits for a long time, it’s just that they are now internet titans.
“I’ve hardly been to the supermarket and haven’t been on a plane in a long time,” he said. “But I use more social media and streaming services. When you have a big shock to the system, it leads to some sectors doing poorly and others doing well.”
Against ‘Techlash’
Yet the massive corporations in Congress and elsewhere are facing a growing techlash as their power and influence increase.
Apple announced this week it would increase its U.S. investment plan to $ 430 billion over the next five years to create around 20,000 new jobs. Amazon said it would raise wages for around 500,000 U.S. workers after repelling union action in a warehouse.
“Companies are making more money, but are putting at least some of it back into the US economy, which could mitigate the negative impact,” Atkinson said.
Facebook reported that despite continued criticism of its efforts to protect user privacy and contain misinformation, the number of its users has increased.
The number of people using the leading social network monthly rose 10 percent to 2.85 billion, according to the Silicon Valley giant. The monthly usage of the “family” of Facebook apps, including Instagram, WhatsApp and Messenger, was 3.45 billion.
On Tuesday, Alphabet announced that first-quarter earnings rose to $ 17.9 billion from $ 6.8 billion in the year-ago period, led by growth in advertising and cloud computing services.
“Google had an absolute monster neighborhood,” said Patrick Moorhead of Moor Insights & Strategies.
Apple announced on Wednesday that its fiscal second quarter revenue was the best ever, up 54 percent to $ 89.6 billion.
Apple saw sales increases in iPhones, iPads, Mac computers, wearables and accessories, and a range of services that range from digital payments to music.
