Alphabet, Amazon, Apple, Facebook release quarterly 2020 earnings

2020 has proven to be an eventful year for big tech, with not only Covid-19 but allegations from US Congress into their business practices being anti-competition. But as Alphabet, Amazon, Apple and Facebook, added $230 billion to their market value, how did their earnings fare in Q3 2020, and in Apple’s case, Q4?


Alphabet, the parent organisation of Google, surpassed market expectations on revenue in Q3 2020, with a 14% year-on-year jump to $38.01 billion (minus traffic acquisition costs), while its stock rose by 9% after hours.

Revenue for Google Cloud also grew, jumping by 45% to $3.44 billion, driven by its data processing and analytics capabilities, as well as a continued shift to the cloud during the pandemic, and its multi-cloud strategy.

YouTube advertising revenue proved a particular highlight, jumping by 32% to $5.04 billion, while “Search and Other” advertising, an area that was forecasted to see a decline, showed 6% growth from the same quarter in 2019.

“We had a strong quarter, consistent with the broader online environment,” said Sundar Pichai, chief executive officer of Alphabet and Google, in the earnings report.

“It’s also a testament to the deep investments we’ve made in AI and other technologies, to deliver services that people turn to for help, in moments big and small.”

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Martin Garner, COO at CCS Insight, said: “Alphabet showed that the dip it suffered in Q2 was a one-off, and it posted strong growth in Q3 as digital advertising spend recovered well. More and more companies have turned to online advertising and shopping as they try to get their business back to near normal trading. So Google Search and YouTube both had solid quarters, with growth moving back towards pre-Covid-19 levels.”

“Google Cloud had another very good quarter, still the fastest growing part of the company and rising 45% over the year, as larger numbers of companies moved their work to cloud services, enabling their staff to work remotely and helping to lower their computing costs.”


Amazon reported revenue of $96.15 billion, a 37% increase year-on-year, despite expenses for shipping products growing by 57% from last year.

Its workforce has also grown, to over 1.12 million full-time employees, a 50% year-on-year increase, contrary to trends seen during the pandemic.

AWS reported revenue of $11.6 billion, a surge of 29% in line with predictions from analysts, as demand from partners such as Slack and Zoom continued to rise.

Jeff Bezos said in Amazon’s earnings report: “Two years ago, we increased Amazon’s minimum wage to $15 for all full-time, part-time, temporary, and seasonal employees across the U.S., and challenged other large employers to do the same. Best Buy and Target have stepped up, and we hope other large employers will also make the jump to $15.

“Offering jobs with industry-leading pay and great healthcare, including to entry-level and front-line employees, is even more meaningful in a time like this, and we’re proud to have created over 400,000 jobs this year alone.

“We’re seeing more customers than ever shopping early for their holiday gifts, which is just one of the signs that this is going to be an unprecedented holiday season.”

Garner commented: “Amazon had another huge quarter, as consumers continued to do more of their shopping online, as more companies advertise on and sell through Amazon, and as more companies moved their work to cloud services. The company is expanding its capacity at very high speed, betting that this behaviour will continue through the holiday season and onwards – unfortunately boosted by further Covid-19 lockdowns and uncertainty.

“The speed of Amazon’s expansion is illustrated by the fact that it hired 250,000 new staff during the last three months, and now has more than one million employees worldwide. It has hired a further 100,000 already in October.

“Despite the frantic pace of investment, Amazon still fitted in Prime Day. It reported that Prime membership, renewals and engagement with the various benefits all continue to climb nicely. This is really important because Amazon Prime has a flywheel effect – the more people use it, the more time and money they tend to spend on Amazon.

“Amazon Web Services had a strong quarter, as the largest of the cloud players, maintaining its healthy growth rate from Q2. While overall demand for cloud services is increasing and more companies are moving their work to the cloud, some existing customer sectors – such as travel – are experiencing dire conditions and are having to cut their cloud spending.”

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For its fiscal Q4 2020 earnings, Apple announced revenue of $64.7 billion, a decline of 21%, as iPhone sales saw a dip of over 20% year-on-year. However, sales for the iPhone 12 aren’t being counted in this quarter.

Sales in China, Hong Kong and Taiwan proved particularly weak for Apple, dropping by 28% to $7.95 billion. Additionally, its stock dropped by 4% in extended trading.

It wasn’t all bad for Apple though, as Mac and iPad revenues grew by 28% and 46% respectively, likely driven by remote working during the pandemic.

In the earnings report, Apple CEO Tim Cook remained positive: “Apple capped off a fiscal year defined by innovation in the face of adversity with a September quarter record, led by all-time records for Mac and Services.

“Despite the ongoing impacts of Covid-19, Apple is in the midst of our most prolific product introduction period ever, and the early response to all our new products, led by our first 5G-enabled iPhone lineup, has been tremendously positive.

“From remote learning to the home office, Apple products have been a window to the world for users as the pandemic continues, and our teams have met the needs of this moment with creativity, passion, and the kinds of big ideas that only Apple can deliver.”

Geoff Blaber, vice-president research, Americas at CCS Insight, said: “iPhone aside, this was a strong quarter for Apple with other product categories continuing to perform robustly. We are inclined to view iPhone weakness in the quarter as validation of strong demand for iPhone 12 in fiscal Q1.

“The fact that total company revenue grew year-on-year despite a big fall in iPhone revenue underlines the increased diversification of Apple’s product lines. iPhone remains the anchor product but 2020 has shown that Apple’s broader business is resilient and can weather shifts in demand to its core product.

“Consumers’ familiarity with and trust in Apple’s hardware, software and services are a big part of its ability to retain customers and convince them to spend more money with the company. This was evident in the earnings. With Covid-19 transforming the way people spend and shop, predictability and familiarity have never been more valuable.”

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Facebook revealed revenue of $21.47 billion, an increase of 22%, but the amount of users in the US and Canada saw a decline of 2 million quarter-on-quarter.

Advertisers were also reported to be up, from 9 million in July to 10 million, despite the StopHateForProfit ad boycott.

The corporation’s ‘Other’ revenue, which includes sales of Oculus virtual reality headsets and Portal devices, totalled $249 million, a year-on-year decline of 7%.

In Facebook’s earnings report, CEO Mark Zuckerberg said: “We had a strong quarter as people and businesses continue to rely on our services to stay connected and create economic opportunity during these tough times.

“We continue to make significant investments in our products and hiring in order to deliver new and meaningful experiences for our community around the world.”

Garner commented: “Facebook had a strong quarter as digital advertising came roaring back. More and more companies stepped up their online activities as they tried to get back towards normal trading, and online advertising growth picked up almost to pre-Covid levels. The platform continues to attract people at an increasing rate, too, with a record number of new users using one of the company’s apps each day.

“Facebook is still upbeat about its opportunities for the next few years such as integrating its messaging systems, shopping services, and virtual reality. Its investment in new product areas is running ahead of its sales growth so, although its margins have recovered well from Q2, they are running lower than levels that investors enjoyed last year.

“Facebook has put many measures in place over the last two years to combat social network problems with elections. But the biggest test of all will be next week as the US Presidential election takes place. The company will face enormous scrutiny for all the election activity it handles and there is bound to be a large and public post mortem, whoever wins.”

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Aaron Hurst

Aaron Hurst is Information Age's senior reporter, providing news and features around the hottest trends across the tech industry.