Quarterly revenues data has been released, showing Microsoft beating expectations and Google barely meeting them. The black sheep of tech is, however, Meta.
This week three major tech companies will release their quarterly revenues concerning the first period of 2023. So far, Microsoft and Google’s Alphabet have released their data, while Facebook parent company Meta will do so when markets close on Wednesday.
2022 was a disastrous year for big tech, with most major players shrinking in value. Stocks in 2023 have been slightly more generous, but companies couldn’t avoid layoffs in the thousands. Among others, Google was forced to lay off 12,000 employees in January.
But 2023 promises tech companies a new toy to play with: Artificial Intelligence. Two months ago, Microsoft acquired OpenAI, the company responsible for ChatGPT, officially starting the AI race.
Google quickly followed suit announcing Bard, a software expected to work similarly to ChatGPT but revealed to be a total failure.
Nevertheless, Google’s revenues for Q1 met expectations. Alphabet earned $69.79 billion against the $69.9 billion expected. This represents a 3% growth compared to last year, an underwhelming number for a company that controls 90% of search engine market share.
For the first time, Google Cloud Service generated a profit. Google Cloud is a data service from Alphabet that competes with Amazon Web Services and Oracle among others.
Microsoft exceeds expectations
But the real winner in the tech race for 2023 seems to be Microsoft. The company’s revenues for Q1 amounted to $52.86 billion, over one billion more than analyst’s expectations.
Microsoft stocks rallied on Wednesday by 7%, after a further 3.5% rise last week when the New York Times announced they’d switch to Bing as preferred search engine.
Microsoft’s success is related largely to their successful AI endeavors. Analysts trust almost blindly the implementation of ChatGPT into Bing, signaling that Microsoft is ahead of Google in the race.
Kash Rangan, an analyst for Goldman Sachs, said they “believe Microsoft is one of the most compelling investment opportunities in the technology industry and across sectors.”
The black sheep of the market seems to be Meta. Though their revenues are expected to increase in Q1 2023 to $27.65 billion, they are yet to show something for the Metaverse.
Meta’s CEO Mark Zuckerberg assured investors that 2023 would be a year of efficiency, and this data will prove how true that could be.
But the Metaverse does not seem to appeal to investors (or, indeed, the public) anymore. The new venture is artificial intelligence, and no plans have been laid out for its implementation in Facebook or other Meta social networks.
