Two emerging questions.
1. Just how fragile is our current economic ecosystem?
2. How big is the shock wave?
Consider, Netflix just took a massive beating when its subscriber numbers dropped, leading to a massive stock value drop, followed by a directional shift.
Now, another of the FAANG monsters gets its turn in the ducking chair.
Alphabet reported weaker-than-expected earnings and revenue for the first quarter on Tuesday. The stock slid about 3% in extended trading.
Nowhere near as catastrophic as Netflix… but wait.
YouTube advertising revenue: $6.87 billion vs. $7.51 billion expected, according to StreetAccount
Is streaming video in trouble? YouTube is warning of an even worse next quarter. And Google is trying to blame the whole thing on the Ukraine war. But it’s clearly not about Ukraine or Russia.
Google has already been trying to cut services and transition as many users of free services to paid users as possible. That’s now become the Netflix model.
The signal here is that the free ride that built Big Tech is over as some of the monopolies start getting desperate.
Within a few weeks, Netflix and Google are in trouble, and Twitter has been sold. That’s a hell of a shift. Move fast and break stuff indeed.
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