In addition to the structure, big techs changed the focus – 02/04/2024 – Marcos de Vasconcellos

When you hear a colleague talk about a 12-month investment with a 28% gain, you’ll probably think it was a fund, share or cryptocurrency that almost no one knew about. But the truth is that this has just happened to one of the most popular indices in the world.

It was up to the Nasdaq index — mandatory in all economic news — to achieve the stupendous result. It brings together, as you may know, shares of companies linked to technology, traded on the eponymous exchange in the United States.

In one year, our Ibovespa delivered gains of 15%; the S&P 500, which brings together the 500 largest companies in the world, rose 18%; while the Nasdaq index soared 28%. This, in fact, while the American interest rate reached its highest level since 2001 — draining money from the capital market.

The explanation may seem like an enthusiast’s talk, but it isn’t. We are experiencing a technological revolution with the advancement of artificial intelligence. And the industry giants, supported by this, are finding their way to new efficiency.

The change has its downsides, such as the layoffs that hit the sector last year. The website Layoffs.fyi, which counts the cuts in the technology industry, adds more than 260 thousand jobs lost in 2023 alone. And everything indicates that the movement continues.

The balance sheets of the giants Meta (owner of Facebook and Instagram) and Amazon, released last Thursday (1st), show that the changes in the companies’ structure and focus had an effect.

On Friday, the first trading session after the results were released, shares in Mark Zuckerberg’s Meta rose more than 20%. Amazon, owned by Jeff Bezos, rose by more than 7.5%. Both traded on the Nasdaq, of course.

In the fourth quarter of 2023, the company behind Facebook saw its net profit more than triple, totaling US$14.02 billion. It was US$ 5.33 per share, which easily exceeded the average forecast of market analysts, which was US$ 4.82. And it also announced that it will pay dividends, which has never happened in the company’s history.

In presenting the balance, Zuckerberg said that the company has begun a global effort to develop artificial intelligence “that will be the basis” of many of its future products. The result was a sequence of praise from banks and a rush for shares on the Stock Exchange.

Amazon also surprised analysts. It profited US$10.62 billion in the 4th quarter of 2023, equivalent to US$1 per share, while the projection was US$0.80.

Dancing to the same tune as his Facebook counterpart, Amazon CEO Andy Jassy said the company will continue to work on developing generative AI and that this investment will “generate tens of billions in revenue.”

Amazon, in fact, took advantage of the event to launch a new shopping assistant: an artificial intelligence platform called “Rufus”. It was clear that, far beyond cutting costs, technology giants changed the direction of spending. And the market applauded.

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