As the economic crisis caused by coronavirus unfolded, some investors braced for painful first quarter corporate earnings.
But in the tech sector, most companies’ results indicted resilience despite the massive disruption. For many, revenue remained relatively strong. Facebook (), Microsoft ( ), Apple ( ), Amazon ( ) and Google ( ) parent company Alphabet all beat Wall Street analysts’ sales expectations.
Still, it’s unclear if the tech giants will be able to sustain that momentum as the pandemic continues. Some warned of experiencing slowing sales only in the final weeks of the quarter; others seemed to have a lack of visibility into what might come next. Apple and IBM () both declined to provide guidance for results in the upcoming quarter, hinting at just how uncertain the road ahead is.
The second quarter could be even more painful. While the effects of the pandemic were really only felt at the very end of the first quarter, it will likely weigh on the entirety of the current quarter, which ends in June.
Especially for small and medium-sized businesses, digital advertising is “their main channel of marketing,” Nucleus Research analyst Daniel Elman said. “The last thing they’re thinking about right now is digital ad spend. That’s going to take a while to come back.”(CNN)