These are external links and will open in a new window
The Corona Virus pandemic caused a wide economic turmoil that affected all countries of the world and millions of people suffered from it, but nevertheless the major American technology companies benefited from the pandemic and achieved enormous profits and financial prosperity.
The American companies made the most gains. Amazon’s sales increased by 40 percent during the three months to June, while Apple achieved a significant increase in sales of iPhones and other devices.
The number of users of Facebook social networking platforms, including WhatsApp and Instagram, jumped by 15 percent.
These gains come as these companies face investigations and interrogations about their size and strength.
At a hearing on Wednesday, officials of those companies were subjected to harsh interrogation by members of the US Congress about the potential misuse of dominance in the technology sector to crush competitors, noting the sharp contrast between their fortunes and what other companies suffer.
Democratic congressman David Cicillin, who heads the committee that has questioned corporate officials, said their positions are likely to become stronger, as the Corona epidemic forces people to increase internet use.
“Before the Corona pandemic, these companies have already emerged as giants of our economy,” he added.
“In the aftermath of the Coruna virus, these companies are likely to become stronger and more powerful than ever,” Cecilin said.
The gains of American technology companies were not a surprise to analysts, regardless of the scale of success achieved by many companies.
In Amazon, the quarterly profit of $ 5.2 billion was the largest since the company was launched in 1994, and these profits were achieved despite massive spending on protective equipment and other measures due to the virus.
“This is an exceptional quarter for all fronts under extreme conditions,” said Charlie O’Shea, vice president of Moody’s, a credit rating.
Amazon’s e-commerce company sales rose 40 percent for the three months to June 30, to $ 88.9 billion, its strongest annual growth in years. Profits increased to $ 5.2 billion, while they did not exceed $ 2.6 billion in the same period in 2019.
The high popularity of online shopping has affected the company’s ability. And Amazon had to employ about 175 thousand people during the three months, and is working to expand its warehouses in anticipation of continued growth.
“The space is out,” said Brian Olsavsky, Amazon’s chief financial officer, in contact with economic analysts about the results.
Meanwhile, Apple said quarterly revenue jumped 11 percent year on year to $ 59.7 billion.
The shift to work and distance learning has helped increase demand for new devices, such as Macs and iPhones, both of which have made significant gains. Profits were $ 11.25 billion, up from $ 10 billion in the same period last year.
Apple said the low-cost iPhone SE release last April helped boost sales and put the electronics giant in a better position, despite the financial implications of the Corona pandemic crisis.
“The past few months have underscored the importance of users and families alike having better quality devices, connections and services,” said Paolo Pescator, a technical analyst at PP Foresight.
As for Facebook, its revenues increased by 11 percent, which is less than the previous quarterly quarters, but it nevertheless exceeded the expectations of analysts, as small companies continued to resort to Facebook to publish ads. The company’s profits amounted to 5.2 billion dollars during the past quarter.
Sophie Lund Yates, equity analyst at Hargreaves Landown, said the flexibility helped it increase the number of users, making the company attractive to advertisers.
The company said 2.4 billion people were active on social media and messaging applications in June, up 15 percent from last year. While Facebook alone registered nearly 1.79 billion daily active users, up 12 percent year on year.
In light of the easing of closings, Facebook said it was “seeing signs of user and post growth returning to normal levels,” warning that these numbers could stabilize or decline in the coming months.
Analyst Sophie Lund said the company also remains vulnerable to social and political pressures, which keep users away.
She added, “But this is not the first time that Facebook has overcome organizational or social difficulties, and has deep pockets to fix problems.”
This comes as Alfabit, the tech giant that owns the search engine Google and YouTube, was the weakest performer among the four.