2022 was a tough year for Silicon Valley. After solid growth for over a decade and a pandemic-induced boom, Big Tech behemoths such as Meta, Alphabet and Apple shed a combined market value of around $2.5 trillion due to macroeconomic headwinds, global supply chain issues and plummeting revenues. In November 2022, the Internet companies covered by Doug Anmuth, Head of the U.S. Internet team at J.P. Morgan, were down by 53% on average year-to-date, and by over 40% weighted by market capitalization — well below the performance of the S&P 500, which was down by 16% year-to-date.
Today, rampant inflation, rising interest rates, sluggish growth and a potential recession are forcing these companies to rethink their business models and reposition for the future. What is the 2023 outlook for Big Tech? Can the sector weather the storm?
