I think the better explanation is the quest for a return on spending. In a low interest rate environment, the bar to generating a return is low because the alte

I think the better explanation is the quest for a return on spending. In a low interest rate environment, the bar to generating a return is low because the alternative is close to a 0% return. So any projects that anticipate a 1% or greater return justify the investment. In a higher interest rate environment (say 3%), the minimum threshold for return on spending suddenly made projects unviable. Big tech companies might be axing projects that no longer clear the new return hurdle, or they might be cutting heads that they anticipated would be needed for future projects that are no longer viable, or they might be inducing higher returns on existing projects by continuing with fewer people / less costs. Also something to keep in mind is that other things in the environment are changing. Facebook was hurt by Apple privacy tightening. Consumer decisions and behavior may change as a result of widespread job cuts and higher borrowing costs. And politicians are ramping up pressure on the sector. Lastly, for better or worse, investing in headcount is more forgiving than investing in heavy capital equipment because companies can make large scale job cuts relatively easily. It's easy to be upset about the downside, but the upside is that some large proportion of the time between economic cycles, large profitable tech companies might be willing to add headcount that isn't absolutely required.