Tech Giants Apple and Amazon Report Sales Increase Despite Economic Downturn

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Image Source: Biznews

Increasing prices have proven to be good for the tech and e-commerce giant, Apple and Amazon. Both major companies showed better performance in their quarterly reports even in the troubled market conditions prevailing in the industry. The figures reflected the strong market position of both major players and their ability to withstand the tough market conditions. Amazon increased its sales drastically by capitalizing on its major product, Prime memberships. While Apple had a steady demand for its iPhones that contributed to the company’s overall profits.

The secret to their success recipe is their firm control over their supply chain operations. Both the companies have controlled their running costs despite the soaring prices of raw material. As Amazon and Apple are leaders of their own respective markets, the position gives them a unique control over the situation and puts them in a better position to negotiate better prices from the suppliers. Experts and investors have been watching both the companies very closely to get the right idea of the industry. These numbers also indicate the consumers’ buying behaviors in these hard times.

The US economy have faced recession consecutively in the first two quarters of 2022. But both these companies represent the strong operations and systems they own. Apple’s COO stated that the company has slower growth in sales than expected but still the company is making profits despite unfavorable conditions. Apple’s profits dropped by 11% than the last year’s figures to $ 19.4 billion, mostly due to the lockdowns it faced in China post COVID-19 situation. However, Amazon’s profits witnessed a dip by $2billion when compared with last year’s figures.

Image Source: Bloomberg

Tim Cook, Apple’s CEO stated the company is facing a mixed bag in the on-going business conditions. The company is lagging back in its services areas including Apple Pay, digital advertising and TV services while experiencing a positive growth in its smartphone line.  Apple, in its quarterly statements released an increase of 2% year on year between April and June amounting to a staggering amount of $83 billion. The major contribution to this figure remained of its phone line.

Amazon on the other hand has been able to survive due to its cloud computing division, AWS, which saw an increase of 33%. The company reported a revenue increase of 7% to $121.2 despite reduced e-commerce activities. The company had a more optimistic outlook at that time and continued to invest more in the structure. Despite the increasing pressure from the rising costs of fuel, energy, and transportation, Amazon continued to make progress on the costs it could control compared to the last quarter. Particularly the company focused on increasing its productivity and making its networks more efficient.

 

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