Nasdaq stock futures fell 1.5% in premarket Wednesday after Alphabet missed on earnings and revenue. YouTube’s first-ever drop in ad revenue helped spark worries for 3Q Big Tech financial results this week. Meta and Amazon fell as the worries weighed on techs, while Microsoft slid post-earnings. Loading Something is loading.
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Stocks on the Nasdaq fell in premarket trading Wednesday, after a disappointing financial update from Google parent Alphabet sparked concerns about the lackluster start to a major week of Big Tech earnings.
Futures for the tech-heavy US stock index fell 1.51%, recovering slightly from a deeper slide earlier in the day, dragged on by losses for Alphabet and Microsoft post-results. Meanwhile, S&P 500 futures dropped 0.67%, and Dow Jones Industrial Average futures had edged 0.09% lower at last check Wednesday.
Alphabet shares slipped over 6% after the online search giant reported weaker-than-expected earnings and revenue for the third quarter. It posted earnings per share of $1.06 versus the $1.25 expected by Wall Street.
The Google parent’s quarterly revenue growth came in at 6%, compared with over 41% in the same period a year ago, with subsidiary YouTube suffered its first-ever fall in advertising revenue. The video-streaming service generated under $7.1 billion in revenue in the third quarter, down from $7.2 billion a year ago.
YouTube missing its targets could be a bad sign for other tech giants’ digital ad revenue prospects, according to strategists.
“When Google stumbles, it’s a bad omen for digital advertising at large,” said Evelyn Mitchell, principal analyst at the research firm Insider Intelligence, which is owned by Insider’s parent company.
Other mega-cap tech stocks fell on the digital ad slowdown fears before the opening bell, with Meta Platforms and Amazon both dropping about 3.5%.
Microsoft shares also slipped 5.6% Wednesday to help drag the Nasdaq lower. It hit its third-quarter earnings and revenue targets, but warned of potential slowdowns in its cloud computing business as a slumping economy weighs on consumer spending.
Meta is set to publish its third-quarter earnings report after Wednesday’s closing bell, while fellow tech giants Apple and Amazon will release their reports Thursday.
Read more: Alphabet’s earnings report confirmed a big ad spending slowdown, and that bodes poorly for Meta