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Earnings Remain Key Risk for Tech Stocks After Worst Year Since 2008

  • Analysts now see tech-company profits dropping 2.2% this year
  • Inflation and valuations are additional headwinds for megacaps
Bloomberg business news
Profits Recession Looming, Bernstein's Suzuki Warns
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Relieved to have turned the page on the worst year for stocks in more than a decade, investors are finding that pricey share valuations and shrinking earnings still stand in the way of any swift bounceback for Big Tech.

While price-earnings multiples have come down from their peaks during the pandemic, many of the market’s biggest names continue to look expensive. At the same time, the profit outlook is weakening and the economy could be headed toward a recession as the Federal Reserve aggressively raises interest rates to combat inflation.