We’ve been covering how larger US economic issues are affecting tech companies. Some of the biggest private web companies, like widget-maker Slide, have already raised tens of millions of dollars hoping to weather the storm. Others, like Meebo, are still in the process of raising large rounds. Most recently, do-it-yourself social network Ning just raised $63 million Series D round that we just covered today.
Meanwhile, today also showed strong earnings from two leading publicly-traded tech companies, search engine Google and chip manufacturer Intel.
So what is it, O dear readers? Are the good times gone for tech companies? Vote now.
4 Comments
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Allan said:
It’ll be interesting to see how the next wave of reports look. Bellwethers like Intel and Google should do well as they have dominating market positions. But in a recessionary environment like the one we’re in, tech spending gets pared, and only the best companies make it out relatively unscathed.
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Christoph Jaggi said:
Never underestimate the impact of currency exchange fluctuations.
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Jojo said:
I had read on some blog postings that GOOG achieved their numbers only because of currency changes, as Christoph Jaggi mentioned. However, I have not seen any mainstream media dig into this. They all just seem to do be doing the CNBC fawning reporting.
If the consumer is 70% of the economy in the USA and the consumer is cutting back, then this does not bode well for Intel and other the suppliers of tech goodies.
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Jojo said:
I wrote a note to the NY Times on their article on GOOG earnings. Got this reply tonight from the writer confirming my information:
Thanks for your note.
I think we were pretty careful not to describe Google’s earnings as a blockbuster success. We said they were a relief to investors who were bracing for much worse. We quoted two analysts both saying that they remain concerned about growth in Google’s US business.
That said, you are right in noting that earnings were helped by currency.
That, and the fact they were also helped by lower than expected tax rates, were two points that we mentioned in earlier drafts but that were cut out during the editing process for space reasons.
