Earnings reports from Apple and Facebook

I would like to talk about COVID-19 effects on economy. And what would happen in post COVID-19 world?

High Tech Companies with small speed bump

Even in Covid-19 pandemic, big tech companies increase sales Apple, Microsoft, Amazon, Google and Facebook increased sales in COVID-19 in 1Q 2020. Apple shut down hundreds of stores globally, but still sales grow.

Facebook still has 3 billion people user base. All these big tech companies show nice profitability but doesn’t seem to have any big challenge in their business model All these companies provide user dependent service.

This corona virus is a sort of speed bump. After this bump, it will go on again with high speed.

The weak business basement of Uber and Lyft

Uber and Lyft are doing its business not showing positive signals to market. At the beggning of this business, there were lots of high valuation and expectation on this business model and company. The value is highlighted so much at the beginning.

It seemed to be very excellent business model without any huge fixed cost. It was just a matchmaker that do not have cars or drivers.

But at the early of May, Lyft announced that it will lay off 17% of workforce that is around 1,000 employees. And Uber will lay off 5,400 employees including 3,000 precious engineers. This is the very classical cases that companies utilize this crisis as the chance to dramatically restructure its business and improve its efficiency.

Regardless of corona virus, if the business model or organization efficiency are not enough to survive, it should be hard to survive in COVID-19 or post corona world.

Inspired by Harvard Business School Business Review

Posted Using LeoFinance