And then there were four: Amazon, Microsoft, Alphabet and Apple

"Four mega-cap companies proved they can withstand a global economic slowdown, super-high inflation and a massive rise in interest rates."  -- Futurum Research's Daniel Newman

From Newman's "The FAANMGs have been whittled down to the fantastic four" posted Monday by MarketWatch:

The anticipation of second-quarter Big Tech earnings was palpable...

It was a mixed bag of results that perhaps left as many questions as answers. But in short, this quarter’s big wave of tech earnings made it abundantly clear. Based on a combination of the right products, the right markets and unfettered demand that vastly outstrips any global economic distress, certain companies are too important to be hampered by the slowdown.

The following four companies have the ingredients that will make them too important to fail and, therefore, should remain long-term outperformers — even when the tech trade is unpopular...

Apple
A new iPhone is always a good thing for Apple. And Taiwan Semi’s TSM, -1.66%earnings comments should have been enough to indicate that Apple would do just fine. The weaker iPad and Mac numbers align with a broader consumer and PC market pullback. However, even with the alarm bells raised by Apple due to continued China shutdowns, Apple, once again, delivered. With margins exceeding expectations and services revenue now reaching almost $20 billion this quarter, Apple is also showing its strength isn’t just in its devices. The service portfolio, along with its growing content business, is working. And the guidance provided by CEO Tim Cook was “pedal to the metal” in so many words — which should have given investors something to smile about heading into the next quarter.

My take: FAANG had already outlived its usefulness (Netflix?).  FAANMG was destined to never catch on, and I don't have much hope for the "Fantastic Four."

4 Comments

  1. Steven Philips said:
    Too important to fail?
    No! They just HAVE’NT failed. Lots of reasons.
    Too big/important implies government propping them up.
    Also (not here) any articles “analyzing” companies as “big tech” have my FAANGS out!

    0
    August 2, 2022
  2. Jerry Doyle said:
    One of my main reasons for optimism on my Apple investment going forward is my deep conviction that companies considered unique, innovative and even experimental in burgeoning technology are going to win big in the beginning of the 21st century; and that means technology companies that are on the cutting-edge of technology to meet the thirsty demands of hungry consumers seeking methods for living their lives fully, independently, yet still connected as they so desire.

    Technology drives the world’s economy. Hook your wagon to the company that will be one of those in the forefront driving the new technologies. I believe it will be Apple for the consumers’ daily lifestyle enjoyment and for those folk in the world-of-work.

    Apple is seeking to enhance consumers’ lifestyle in Health/Wellness, transportation, entertainment, finance, networking, socializing, working, communicating, education and this is not just targeted to the American consumer but an American multinational technology company serving the peoples of all countries. Add to that an outstanding skilled & sophisticated leadership team able to produce the world’s needed premium consumer products and you have what seems outsized success going forward. It’s the reason even an old stodgy 20th century codger recognized several years back he needed to get abroad the Apple train.

    Laissez le bon temps rouler!
    Geaux Apple  & LSU!

    7
    August 2, 2022

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