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> Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended. I mean people who had financial gain on the l
by hbn 4y ago
> Many people predicted this would be a permanent acceleration that would continue even after the pandemic ended.
I mean people who had financial gain on the line (like yourselves) pretended this was the case so you could cash in at the time and then pull the rug once it wasn't working any more (as you're doing now), but everyone with half a brain knew it wasn't sustainable.
Literally how could that acceleration be permanent? With the insane exponential growth inflated by covid in 2020/2021, you'd have a few years before these big tech companies would have to be gaining more users than exist on earth.
- roflyear 4y agoFB is making $30+bn a year profit, and is laying off people to reduce costs by $2b. They could continue to pay these people. Large corporations are insane. Every small and medium company would wait to do layoffs until it threatened the business. Some even until after that point. Layoffs are awful. Large corps, nah. Just lay people off if we get a little nervous! Note, I don't think these corps are entitled to employ you. Absolutely not. I just think the corporate situation we got ourselves in is really nasty.
- 8b16380d 4y agoCompletely agree.
- abstractmath 4y ago> Large corporations are insane. Every small and medium company would wait to do layoffs until it threatened the business. Some even until after that point This is super idealized. How many layoffs have been going on in startup land recently?
- skrebbel 4y agoYou mean teeny tiny cutesy startups like Stripe and Twilio?
- abstractmath 4y agoLook at the companies on http://layoffs.fyi http://layoffs.fyi Lots of small and medium sized companies, and I know for some that it was not their last move before going under. We had a hiring boom driven by cheap money, which is now ending. Now we get the inverse. Has nothing to do with insane large corps and saintly SMBs.
- tomtheelder 4y agoWhile I agree it's very idealized, a lot of those startups probably are legitimately financially threatened in the immediate term in a way that Meta most certainly isn't.
- roflyear 4y agoIt is absolutely idealized.
- martindbp 4y agoThey are laying off people because the value of the company just tanked 70% in a few months. The value of a company contains all the future estimated discounted earnings, the trend of earnings matters more than current earnings. The actions of a company is determined by what its shareholders want, which is to maximize stock price, not be satisfied with X billions in profits when the stock is down 70%. The actions of companies will remain a mystery to people who do not understand this.
- oblio 4y agoThe value of a company contains Lalaland logic, as Tesla, Toyota and GameStop prove. The link between actual business logic and company valuation broke down around 2010.
- roflyear 4y agoWell, yeah. But I think that mechanism is pretty awful.
- martindbp 4y agoYeah it's awful, but that's life. FWIW I have family working at Meta so I'm not just being callous.
- jbverschoor 4y agoSmall companies don't pay over 200k + perks for someone who just graduated
- xyzzyz 4y agoThey lay people off, because companies always want to lay some people off, and doing so in normal times is even less palatable. Employees are not fungible, and some employees are worth to companies less than the company wants. This is not to say that every single person being laid off is of low value, that’s not true. It’s just it is hard to lay off only low performers, some average or even good performer will always be collateral damage. But, overall, if you want well-performing companies to not do mass layoffs on recession, the only way is to make it more palatable to people to see mass firings in good times.
- rajman187 4y ago> FB is making $30+bn a year profit, and is laying off people to reduce costs by $2b. They could continue to pay these people. The quarterly revenue was about $27bn but net profit $4bn, so you're off by a factor of 7 or more on the estimate. R&D expenses alone are $9bn, and the largest operational expense is employee comp, by a LOT, distant second being data centers. For added measure, they also reduced real estate footprint along with the 11k employees. The company has also essentially doubled in size every year since ~2013, and that was certainly encouraged by false positives in terms of future projections when the pandemic hit. So this is really not surprising, and a major cost-saving function for them.
- roflyear 4y agoMmm, I was looking at 2021 profit. Anyway, 16b a year is not a factor of 7 off from 30b.
- riku_iki 4y ago> R&D expenses alone are $9bn Are RSUs included into this number?
- _zoltan_ 4y agowhy would RSU (a comp element) be included in R&D spending?
- disgruntledphd2 4y ago
- gregshap 4y agoIn the last four quarters FB's reported profit went from $10B to $7.5B to $6B to $4B. The business is threatened.
- martius 4y agoI read this as "we expected to stay at the levels we were at at the beginning of 2022, but instead things went back (down) to the levels of 2019".
- hbn 4y agoThey specifically said "acceleration" though, not velocity Meaning they expected to continue picking up speed, not maintain their speed
- sabellito 4y ago> but everyone with half a brain knew it wasn't sustainable. Did you short all these companies and are currently a billionaire? Since it took only half a brain to know.
- enumjorge 4y agoIsn’t part of shorting also predicting when the drop will happen?
- three_seagrass 4y agoYeah, I shorted during the pandemic but missed the drop several times. Everyone knew to short, it's the when that nobody could fathom.
- mattnewton 4y agoHe's also probably not an accredited investor, selling a stock short in any significant volume is not like making a retail purchase. It can be quite hard to make money off knowing a stock will crash, and that's not even accounting for needing to know _when_ precisely since most of the ways involve short dated options. I gave up after investigating ways to bet on interest rate hikes and market corrections, and just went cash heavy at the end of 2021. That doesn't make you a billionaire it makes you just not lose principle.
- andromeduck 4y agoMost people on HN probably are - especially those at FAANG. It's just 2 years with 200k individual or 300k combined income, or 1M NAV.
- mattnewton 4y agoTrue, this was the wrong way to phrase it on my part. What I should have said is "they probably aren't a professional investor who knows what they are doing and has access to lots of capital or leverage, and a Bloomberg terminal or whatever people use these days to locate stock to borrow and sell short".
- dolmen 4y agoMany thought that commerce was switching to online. But in fact stores reopened and people went back to massively buy at stores instead of offline. Parenthesis is closed.
- fullshark 4y agoThat is the premise behind the metaverse, more and more activity going online.