US Tech firms: The road to global influence

The Covid19 outbreak is now over a year into our lives, forcing us to make tremendous changes in order to adapt to its challenging circumstances. Even though our freedom does not exist as we used to know it and has been put under control, the way we think as consumers has also changed even though we may not fully understand it yet. The US high tech companies, have boomed during the pandemic, making huge financial gains but also receiving user recognition on a mass scale. This report aims to identify some of the most important high tech companies’ performance since the coronavirus entered the scene.

Among the biggest changes we have come across since the virus outbreak globally, is the transition to working from home instead of going to the office. The businesses that have the technology to do this, were caught by another surprise however, that may had been overseen initially. The pandemic has propped a huge demand for devices such as laptops, tablets, microphones, headsets and monitors as more people are basically setting up their personal office at home. The demand was boosted even further as students of all stages of education, were forced to take lectures and seminars online. In this case, the first of businesses that benefited from the new conditions of working was Apple (#AAPL) with special focus on laptop demand. Apple initially saw a decrease in its Mac sales in the first quarter of 2020 yet the company saw increased demand for many of its products, as we moved further into the year. At the same time Apple unleashed its new iPhone series 12, which was a great success as it introduced cheaper models that could be affordable much easier possibly by a new group of customers. Some analysts believe that Apple was also supported by economic stimulus measures passed by Congress during that period.

According to Apple’s income statement, Net income moved from $91.8B in December 2019 to $111.4B in December 2020. Another US tech company that surged to the top during the pandemic was Microsoft Inc. (#MSFT), with consumers being attracted to a number of its products. First Microsoft’s Azure cloud computing services had captured the scene as many other businesses needed its abilities to overcome obstacles created by the virus. For example, in March 2020 when the virus had reached the US, the Washington State Department of Health approached Microsoft for creating a cloud-based Hospital Emergency Response plan ran by Azure. These hospitals benefited from the platform by tracking COVID-19 cases and matching them to available hospital beds or equipment and supplies. This is just a fracture of the capabilities that Azure keeps, while other businesses use its data storage capabilities. Microsoft has also seen demand over its Xbox videogames as more people spend more time indoor, with government measures imposed. Furthermore, Microsoft’s Teams software has gained both great attention and success as people need to have business meetings on a daily basis, with the communication platform bringing them together at ease. Microsoft’s shares are up more than 30% over the past year and its sales reached $43.1B in Q4 of 2020 compared to $36.9B in Q4 of 2019.

The king of online retail selling, Amazon Inc. (#AMZN) managed to thrive during the pandemic with its sales recently increasing to over $100 billion in the last quarter of 2020. Consumers found its platform extremely useful during lockdowns, as online shopping could have not been so convenient if it wasn’t for Amazon. Earnings per share were $14.09 vs $7.23 per share forecasted by Refinitiv, while revenues were $125.56 billion vs $119.7 billion forecasted by Refinitiv for the 4th quarter of 2020. This is the first time that Amazon’s quarterly sales surpassed $100 billion. The figures confirm that Amazon customers have increased, while existing customers may have increased their purchases in the latest quarter of 2020. Yet with all the transactions taking place globally, Amazon was bound to need further help to support and even enhance its operations. According to various sources Amazon has employed almost half a million people in 2020.

On the other hand, with so many businesses feeling the adverse effects of the pandemic and not being able to properly respond to circumstances seen for the first time, they were forced to pour more money into advertising as a strategy to keep their operations flowing. The most obvious ways to place advertisements while most of the world stayed indoor was through the internet and specifically Google (#GOOG). Alphabet, Google’s mother company posted revenues of $56.9B supported by strong performance from Google search and YouTube in the latest quarter of 2020. Advertising contributed to the revenues rebounding from a drop earlier in 2020. As the pandemic is ongoing we could suggest that more advertisement through the Google search engine 그리고 YouTube could continue in the first half of 2021. Moreover, another crowded platform that can be used for advertising can be found through Social Media. Facebook (#FB) is a very accurate choice as it entertains over 2 billion users daily. Even though the company had come under immense pressure from the governments around the world in the past years over its policies, the social network remains in the epicenter of the tech companies group that grew during the pandemic. Facebook owns a chain of social networks like Instagram, WhatsApp and Messenger which continued to attract new users world-wide making it also an excellent choice for advertising. In addition, Facebook is now using Instagram as a shopping tool with new features for users as it attempts to make small steps into the e-commerce world. Facebook’s net income reached at $28.1B in the 4th quarter of 2020 compared to $21.1B in the last quarter of 2019.

Overall we have confirmation that the pre mentioned companies have managed to use the adverse conditions of the pandemic to their advantage and turn expectations of a negative outlook for the general economy around. They have not managed only to make large profits and increase their revenues on a yearly basis, they have managed to cement their place as some of the most resourceful companies and platforms globally, offering their services to anybody in need. The most important part is that other people can benefit also from these services by using them as tools for sales, advertisement, business structure, communication, and entertainment. The US high tech companies are the international leaders when it comes to new trends, doing business, high technology and creating high quality products. Is this a monopoly or a temporary increase of net worth and influence?