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GlobalData, which helps the world’s largest companies be more innovative, says the pandemic is providing new growth opportunities for technology companies.

The world’s top 25 tech companies, which include software and hardware developers, IT services providers, and electronics manufacturers including semiconductors, mobile devices, etc., all reported quarter-on-quarter growth in market capitalization (MCap) for the second quarter of 2020.

Ranked top by GlobalData, Apple’s revenue in Q2 was driven by the performance of its services and wearables businesses. This enabled the company to leapfrog Microsoft as the world’s most valuable company.

Keshav Jha, business fundamentals analyst at GlobalData, said that the announcement of the new iOS and new iMac during Apple’s annual developer conference (WWDC) in June 2020 seemed to have pleased investors.

Microsoft was the second of the top 25 tech companies by MCap. The company’s business accelerated, mainly driven by growth in its cloud usage, increased Xbox sales, and higher demand for Office commercial and Dynamics business solutions.

In third place was Amazon Web Services (AWS), which recorded a  surge in demand for its cloud services after the COVID-19 outbreak. Additionally, an increase in e-commerce retail demand due to lockdowns imposed by governments in major economies helped Amazon’s stock rise over 40% and its MCap crossed the US$1 trillion mark in Q2 2020.

In the digital advertising space, Alphabet, Facebook and Tencent were the three major players.

“Although suspension of sports events affected Tencent’s media advertising revenue, its online advertisement and games revenues increased over 30% in Q1 2020, which seemed to help the company win over investors’ confidence,” Jha said.

Major semiconductor companies such as Samsung, Taiwan Semiconductor, NVIDIA, ASML, Broadcom, Texas Instruments, and Qualcomm recorded 9%-45% growth in their QoQ MCap.

“The health crisis led to rise in demand for memory chips,” Jha added. “Mainly due to higher demand from cloud applications linked to remote working and online education. The continued investment in AI, 5G infrastructure, data center, autonomous vehicles and gaming also kept market interested in these stocks.”

ServiceNow and Zoom were the two new entrants in GlobalData’s top 25 technology companies on my MCap list.  The rise in usage of Zoom for virtual meetings during the pandemic led to 75.6% QoQ growth in its MCap during April-June 2020.

“The economic downturn caused by COVID-19 has impacted all sectors,” Jha said. “But the performance of tech stocks in Q2 suggests that investors believe they can successfully manage the headwinds from the health crisis. Tech companies are uniquely positioned to provide technology and resources to organizations and partners, which help in securely accessing and sharing data while working remotely. These companies are also playing pivotal role for consumers coping with lockdown measures, and in enabling health institutions and governments to maintain databases, which help in containing the spread of virus.”

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