What to expect from Big Tech revenue
Good morning! It’s payout time and you might be thinking, “Oh, I know what it’s going to be like.” But as always, there’s good news and bad news, and some things in particular to watch out for.
It’s only getting more brutal out there
My colleague Joe Williams has compared future tech revenue to Captain Hook lowering a prisoner onto the board. A scary image, I know, but how else would you describe it?
There is good news and bad news with earnings. The good news is that, as bad as technology earnings are, most major vendors have customers locked into longer-term contracts and are protected from any immediate impact from fluctuating IT spending.
- But we’ve seen Big Tech take plenty of cost-cutting measures in recent weeks, between hiring pauses at Google and Uber and deadweight reduction plans at Meta, all in an effort to protect against an uncertain economic future.
- Joe said that was just the beginning. When customers have to determine their own spending priorities at the end of 2022, we’ll find out who’s really struggling.
- “There are so many companies at risk of downgrades,” RBC Capital Markets’ Rishi Jaluria told Joe.
It may be best to look at revenue on a topic-by-subject basis. Here are some of the most important things to watch out for.
- Customer demand: Earnings reports will clarify which companies only received a short-term boost from big pandemic-era spending, and which can weather the storm in the long term.
- Exchange rate: many technology providers do not operate here. If the US dollar does better than other currencies, revenues and cash flow abroad could suffer.
- Consumption-based pricing: Look for AWS, Google, and Microsoft here, as well as emerging giants like Snowflake. IT vendors may not be making as much money this quarter from customers paying for what they use.
- Product-led growth: Driving the growth of end users who purchase products online with a single click, outside of the central IT team, is much more difficult during tough economic times.
- ISV: There will likely be concerns about whether ISVs (think Asana) can stand on their own or need to consolidate to survive.
Read Joe’s full earnings overview here.
When a company buys back its audit
Yesterday Meta released its first human rights check, which assesses the company’s approach to human rights risk management. It was commissioned by Meta from law firm Foley Hoag, but as often happens when companies commission their own audits, it glossed over major controversies.
What the audit did not include was a comprehensive assessment of its impact in India, its biggest market in the world – an omission that sparked criticism of some digital rights defenders.
- Meta instead published a “summary assessment” of Foley Hoag’s findings in India, which noted “the potential for Meta’s platforms to be linked to salient human rights risks caused by third parties, including …incitement to hatred that incites hostility, discrimination or violence”. but disclosed few details and did not publish the company’s recommendations.
- The company was previously accused to ignore online abuse and allow content to fuel violence in India. Human rights groups had demanded publication of the assessment.
- Meta’s human rights director, Miranda Sissons, told Reuters that “the format of the report may be influenced by a variety of factors, including security reasons”.
It’s not uncommon for ugly details to be omitted company audits like this.
- A recent AWS investigation conducted by Oppenheimer Investigations Group and commissioned by Amazon found no evidence to support claims of discrimination and harassment, even though many employees said he was hiding in plain sight. Amazon has also long resisted an independent audit of warehouse working conditions, convincing shareholders to vote against the probe.
- Despite a litany of harassment and discrimination allegations, Activision Blizzard self-investigation found no evidence of systemic misconduct.
“These reports are public relations, not facts, and should be treated as such,” wrote the Real Facebook Oversight Board, a watchdog organization run by The Citizens, in a statement. blog post. While it’s understandable that companies often want to add their own twist to these kinds of issues, tackling the issues head-on can actually play better with the public and employees.
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People are talking
Matthew Ball said people should think of the metaverse as a change to the devices we use:
- “We will continue to use smartphones, keyboards… It’s supplements and supplements, it doesn’t replace everything.”
Jeff Lawson said that Twilio is applying some hard lessons since its debut during the 2008 financial crisis:
- “Frugality is one of our principles.”
OpenSea cut 20% of its staff due to an “unprecedented combination of crypto winter and broad macroeconomic instability.”
Chris Rantamaki is the new SVP of Original Programming for TMB. Rantamaki previously held similar positions at Paramount and Discovery.
Jim Esposito and Akash Garg have joined MoonPay as COO and CTO, respectively. Esposito was Cash App’s CEO and Garg was Block’s VP of Engineering.
Jessica Rivera and Maurice Slade have joined SoundCloud as Global Vice President and Chief Marketing Officer, respectively. Rivera comes from Mass Appeal and Slade last ran marketing at Epic Records.
Shon Manasco is Palantir’s new senior advisor focused on air, space and international government work. Manasco is a former acting undersecretary of the Air Force.
Sam George is Microsoft retirement. George has held a few leadership positions for Azure over the years and was most recently Vice President of the company.
Marty Chavez joined Google’s board of directors. Chavez is a former chief financial officer of Goldman Sachs.
In other news
The SEC asked Elon Musk why he hasn’t updated his file last month to show he wanted to scrap the Twitter deal. Musk never responded.
Here’s everything you need to know about crypto crash, which we will update as the sector takes more turns.
Fridays are no longer for the office. About 30% of workers slipped in that day in June, compared to about half of employees on Tuesday.
The GM is will probably reject Alphabet’s concessions to its antitrust lawsuit, in which the company did not suggest selling its huge advertising unit.
The House passed the Active shooter alert act, which allows law enforcement to send Amber-style notifications when there is an active shooter in the area.
Stripe cut the internal value of its shares 28% off, up to $29.
GM plans to build a network of 2,000 EV fast chargers nationwide at Pilot and Flying J truck stops.
Facebook is testing the ability for users to have up to five profiles both used for different purposes like one for friends and another for coworkers.
We can’t use twitter for an hour yesterday, which was the worst and the best thing ever.
Automate your procedures
Does your workplace still use thick binders for its office manual? It may be time to digitize. Protocol Workplace reporter Lizzy Lawrence wrote about Scribe and Tango, tools that create step-by-step guides from screen recordings of work processes. These tools have become useful in the technology space, where high turnover has made it more likely that workplace guides will be written by people who have since left the company.
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