Netflix was the first of the FAANG (Facebook/Meta, Apple, Amazon and Google/Alphabet), companies to release results in 2022, with companies to report this season and it set a low bar for the rest of its merry band of tech giants to follow
A fourth quarter report accompanied by a prediction of a slowdown in new subscribers spooked investors and sent its share price crashing by 26%.
Forecasts stand at 2.5mln new subscribers for the Nasdaq listed company were considerably lower than the 4mln achieved for the same period last year and miles short of market forecasts Can its compadres do better?
Apple
Apple’s first quarter update is next Thursday.
The Silicon Valley company, which became the first company to touch a US$3tln valuation earlier this month, were cautious in setting expectations with its previous results.
First quarter trading has historically been strong for the tech giant, often boosted by the Thanksgiving and festive period sales, which would have been further helped by the new Apple iPhone13 and new Apple Mac products.
Supply chain issues and chip shortages are potential bumps in the road but even with these analysts are predicting sales to rise by 6% like-for-like to US$118bn or simply another eye-watering number.
Alphabet
Alphabet, previously Google, reports final year and fourth quarter results on 1 February.
The company expects hardware to be a driving force behind revenue in the fourth quarter, with products such as the Fitbit (NYSE:FIT) once again benefitting from a seasonal boost.
Like its peers, Google is facing growing regulatory headwinds both in the US and Europe and what it says about these will also be closely monitored.
Meta
Previously Facebook, Meta will for the first time be reporting two statements which cover the two separate branches of the company.
Performance of its “Family of Apps,” such as Facebook and Instagram, will be separated from the virtual and augmented reality branch of the businesses.
Rebranding in name was the first step changing the strategy of the company, and Meta expects that its heavy investment ibn the metaverse have a knock-on impact on profit margins.
In its previous statement, it highlighted that investment in Facebook reality labs would hit profit by US$10bn for 2021.
It remained cautious over the revenue for the fourth quarter, citing uncertainty in the market and changes in the macro-economy meaning earnings are forecasted to fall between US$31.5bn and US$34bn.
Like Google, it is getting plenty of regulatory flak at present How much additional it has spent on controlling what content goes on its platform will be another thing to note.
Amazon
Jeff Bezos’ Amazon will be the final tech giant to release results on 3 February, with investors hopeful the company achieves its forecasted revenue targets between US$130bn-US$140bn, a potentially 12% growth on the same period last year.
Like most of the other FAANG companies, it would have benefitted from the festive period sales, although once it again remains to be seen whether COVID-19 lockdowns that swept across Europe had any impact on performance.
Operating income is also expected to be between less than $3.0 billion, considerably lower compared with $6.9bln in the fourth quarter 2020.