Big Tech added to contraction forecast, but maybe Bob Iger can lift the mood

Wall Street’s expectations for 2023 have dropped as forecasts for the new year come out, and the news could turn worse when they take into account disappointing results from Big Tech. But at least Bob Iger will be back for the sequel.

Google, Facebook, Amazon and Apple are all disappointed with this week’s holiday earnings. Their forecasts range from non-existent to partial to meh, and the fallout will only add to the biggest drop in Wall Street expectations throughout the year since 2016.

Average analyst forecast for 2023 earnings from the S&P 500

According to John Butters, senior earnings analyst at FactSet, the drop was 2.5% in January, the worst rate in seven years. Those predictions started going lower last yearand the decline is only getting stronger — analysts are now predicting 3% earnings growth in 2023, and that depends on a major holiday rebound from results released this quarter.


The news was even worse in the first quarter, whereby predictions fell 3.3% in January as companies sniffed their forecasts at breakneck speed: 86% of 43 companies guidance on first-quarter earnings missed forecasts, Butters reported. Earnings are now expected to drop 4.2%, which would be the first annual drop in earnings since Q3 2020, when the COVID-19 pandemic debt forgiveness started rolling in.

Big Tech has only added to its downward trajectory in recent days. Inc.
missed the holiday earnings as well as the forecast for the first quarterand that company can determine for themselves whether S&P 500 returns will increase in 2023. Amazon’s worst holiday earnings since 2014 may also have contributed to the first drop in consumer discretionary income since the start of the pandemic, with holiday earnings now is expected to fall more than 5%.

Google’s parent company, Alphabet Inc.

And The parent company of Facebook Meta Platforms Inc.

also missed their respective earnings targets amid problems with the digital advertising industry, leading to the media services industry having its worst earnings season in the S&P 500. has so far fallen 25.2%, the worst of the 11 S&P 500 Butters reported, but would have fallen only 6.5% without the impact of Meta and Alphabet.

Apple Inc.

nor do predict any favors, reports biggest revenue drop since 2016 and missed earnings Thursday afternoon. In a partial forecast, Executives predicted a similar drop in sales in the first quarter, though unofficially.

Earnings this week

Afterward busiest week in earnings season In the end, don’t expect much relief — 95 S&P 500 companies are expected to report next week, the third consecutive week that at least 90 companies have reported. There will be many conspiracies among non-S&P 500 companies, including Robinhood Markets Inc.

and Affirm Holdings Inc.

report together on Wednesday afternoon.

There is only one Dow Jones Industrial Average

Stocks will report, but it’s the Wednesday call you’ll want to watch: Bob Iger returns to Walt Disney Co.

display income.

Calls to include in your calendar
Numbers to see
  • Food prices: Groceries, prepared foods and even snacks have seen higher prices during bouts of inflation, and executives will give clues about their pricing plans almost every day of the week: Tyson Foods Inc.

    on Monday, Chipotle Mexican Grill Inc.

    on Tuesday, Yum Brands Inc.

    on Wednesday and ending with PepsiCo Inc.

    Kellogg Co

    and Flowers Foods Inc.

    on Thursday. Listen to some of the phrases they use to suggest that they can still bullish if they want last season: “pricing power”, “strong pricing” or “price realization”.

  • Car rental price and demand: In their most recent results, Lyft Inc.

    disappointed with the number of rides, but showed much higher revenue per ride, while Uber Technologies Inc.

    trips increased 19% as total bookings increased 45% on a constant currency basis. Both of these point to rising prices, which could affect demand, which is steadily increasing in the third year of the COVID-19 pandemic. Compare bookings and revenue growth with ridership and ride growth as Uber reports Wednesday morning and Lyft Thursday afternoon. Read more: Food prices continue to rise. Food company executives are betting that Americans will keep paying.


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