Farewell, FAANG. With its stock price collapse this week, Netflix became the second member of the iconic group of high-flying big tech stocks—Facebook, Apple, Amazon, Netflix and Google—to get kicked to the curb this year. The other, of course, was Facebook parent Meta Platforms, whose stock was pummeled after its bleak fourth-quarter earnings call in early February and is down 45% for the year so far. The question now, as we await next week’s March quarter reports from a parade of big tech firms, is whether there will be any similar earthquake-like surprises from anyone else.
What we’re talking about is growth slowdowns that fundamentally change investors’ view of a company’s prospects. In a way, we may already have seen such a deceleration from at least one other big tech company, Amazon. Its quarterly growth rate slowed to 9% in the fourth quarter, and analysts expect the first quarter will show an even more tepid rate of expansion of just 7.4%. (See our earnings preview below for details.) This might be a temporary weakening as the market settles down after the pandemic surge in online shopping. But it’s also possible that Amazon’s e-commerce business has peaked, at least for a while. Should investors react more? After all, at a 7% or so growth rate, Amazon is growing more slowly than either Netflix or Meta.
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