Tech titans pummelled on tepid outlook

Internet titans Google and Amazon came under an investor cloud after posting disappointing sales updates, with the search leader also on the defensive for reportedly hushing up sexual misconduct.

Two of the world’s most valuable companies suffered slides in their share prices after releasing their quarterly earnings, declines that fuelled pessimism in Asian and European stock markets yesterday.

While both reported bumper profits, revenues came up short of expectations at Google and Amazon spooked the markets with a so-so forecast for the allimportant holiday season coming up. “Given the current market backdrop, your earnings report has to be perfect or your stock will get punished,” said Vic Anthony, an analyst at Aegis Capital Corp. Alphabet’s revenues fell short of forecasts, rising 21 per cent to $33.7 billion in the three months ending in September, compared with the same period a year earlier. Shares were down 5.04 per cent.

Amazon stock was down 8.66 per cent, despite seeing its quarterly net profit grow ten-fold from a year earlier to $2.9 billion.

Net sales climbed to $56.6 billion in the third quarter, up 29 per cent year-on-year.

That was less than forecast, and investors were also disappointed at Amazon’s predictions for revenue and profit in the busy period leading up to Christmas.

“Make no mistake, Amazon remains a behemoth in the online market,” GlobalData Retail managing director Neil Saunders said. “However, others are now getting better at nibbling away at its dominance.”